Tax Authorities Can Freeze Individuals' Bank Accounts Without Court OrderâBut Only Up to the Debt Amount, Clarifies Federal Tax Service
Russia's Tax Agency Can Now Freeze Accounts for Unpaid Taxes Without Court Approval
The Federal Tax Service (FNS) may freeze funds in an individual's bank account if they have unpaid tax debtsâbut only up to the amount owed, the agency told RIA Novosti.
Account transactions can be suspended without a court ruling if taxes remain unpaid after the voluntary repayment deadline. However, this does not mean a full blockade: funds exceeding the debt amount will remain accessible, the FNS emphasized.
"The Federal Tax Service of Russia does not block accounts but suspends transactions only for the amount of the outstanding debtâthat is, up to the negative balance of the taxpayer's unified tax account," the agency explained. Any funds above the debt sum remain available to the account holder. It is important to note that the debt recovery procedure from individuals' bank accounts is initiated only if taxes are not paid on time.
How the Extra-Judicial Debt Collection Mechanism Works
First, the debtor receives a tax payment demand specifying a deadline for voluntary repayment. The notice is sent either to their personal account on the FNS website or the Gosuslugi public services portal, or by mail. If the demand is ignored, the FNS issues a debt collection order, notifying the taxpayer againâeither electronically or by post. The debtor then has seven business days to settle the debt or file an objection. If no objections are raised, the FNS instructs the bank to deduct the owed amount from the account.
The FNS stressed that transaction restrictions are lifted once the debtâincluding any overdue amountsâis fully repaid. For self-employed individuals, debt collection is applied without separating accounts, meaning funds can be deducted from any account, including personal ones.
The FNS gained the authority to deduct unpaid taxes and fees from citizens' accounts without a court order as of November 1, following a law signed by Russian President Vladimir Putin on July 31.
