The British Council has always said its operations were entirely legal
A Russian court has thrown out most of the tax claims made against the British Council, some of whose Russian offices were closed amid a diplomatic row.
The Moscow court ruled that most of the tax claims filed against the British government's cultural arm were invalid.
Tax inspectors accused the body of evading taxes from 2004 to 2006.
The action against the British Council was ordered at the height of the Russia-UK row over the murder of ex-spy Alexander Litvinenko in London in 2006.
Litvinenko was killed with a dose of radiation poisoning. He had been a fierce critic of former Russian President Vladimir Putin, but the Kremlin denied any involvement in the murder.
When Russia refused to extradite the main suspect to Britain last year, the UK expelled four Russian diplomats.
Russia responded by expelling four British staff, and its Foreign Minister Sergei Lavrov told the BBC that British Council regional offices were also being shut in "retaliation".
Tax charges were also filed. But on Friday the Moscow Arbitration Court "recognised as invalid a decision from a tax inspection in the part where it filed income tax and value added tax claims," a spokeswoman said.
The UK has indicated it wants to improve strained ties with Moscow, and hopes to have the British Council offices reopened.
Britain sent a new ambassador to Moscow this month.