Individual entrepreneurs usually choose preferential tax regimes. This allows them to optimize costs and submit fewer reporting forms. The general taxation system for individual entrepreneurs is not the best option. As a rule, her choice is dictated by necessity. And in some cases it is not there at all, because you can end up on OSNO not of your own free will.
This will happen if you go beyond the restrictions established within the tax regime for the income of individual entrepreneurs, the number of employees or types of activities. Or if you don’t switch to a simplified tax system in time. The general taxation system for individual entrepreneurs is relevant if he works with large buyers who pay VAT. Let's figure out what the OSNO regime is and what kind of reporting needs to be submitted here.
Personal income tax on entrepreneur income
An individual entrepreneur pays personal income tax on the amount of income he receives from business activities. He has the right to reduce them by professional deductions in the amount of costs that he can confirm with documents. If there are no documents, an individual entrepreneur on OSNO has the right to deduct 20% from his income. The result is a tax base to which a personal income tax rate of 13% is applied.
The procedure for paying tax is described in Article 227 of the Tax Code of the Russian Federation. During the year, the entrepreneur makes 3 advance payments at the following times:
- for the 1st quarter - no later than April 25:
- for the 3rd quarter - no later than July 25;
- for the 4th quarter - no later than October 25.
At the end of the year, the individual entrepreneur must recalculate personal income tax based on how much income he actually received and paid in advances. Additional tax payment must be made before July 15 of the following year. And by April 30, an individual entrepreneur on OSNO is required to submit a 3-NDFL declaration to the Federal Tax Service.
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How to organize accounting
In accordance with paragraphs. 1 item 2 art. 6 402-FZ, individual entrepreneurs have the right not to keep accounting records. In this regard, the accounting policy of individual entrepreneurs on OSNO is not mandatory. To take advantage of this opportunity, accounting for income and expenses should be carried out in the Individual Entrepreneur’s Income and Expense Accounting Book. You can read more about this here.
Refusal to do accounting is a right, not an obligation, of an individual entrepreneur. Therefore, if desired, an entrepreneur can conduct accounting in the usual manner: using double entry and ordinary accounting registers.
Legal documents
- Chapter 21 of the Tax Code of the Russian Federation
- By Order of the Federal Tax Service dated October 29, 2014 No. ММВ-7-3/ [email protected]
- Government Decree No. 1137 dated December 26, 2011
- Art. 145 Tax Code of the Russian Federation
- Art. 221 Tax Code of the Russian Federation
- Chapter 25 of the Tax Code of the Russian Federation
- Chapter 34 of the Tax Code of the Russian Federation
- Law 125-FZ of July 24, 1998
- 402-FZ
VAT
OSNO is one of two taxation systems that requires payment of VAT. Tax is calculated on the cost of goods, works and services sold. The standard rate from 2021 is 20%. There are a number of preferential goods that are taxed at a rate of 10%. These are food, goods for children, printed periodicals, and some medical products. The full list is presented in paragraph 2 of Article 164 of the Tax Code of the Russian Federation.
In addition, in some cases there is a zero VAT rate. It is used for export, international transport and cargo transportation. There are also a number of transactions that are not subject to VAT (Article 149 of the Tax Code of the Russian Federation). Among them are the sale of certain medical goods and services, care for the disabled, activities with children in clubs and others.
The VAT allocated in the incoming invoice can be deducted by the buyer. It is because of this opportunity that entrepreneurs often choose the main tax regime. This allows their counterparties to reduce the tax payable. The individual entrepreneur himself can also take advantage of the deduction and reduce VAT by the amount of the “input” tax charged to him by suppliers.
VAT is calculated at the end of each quarter. The amount received is divided into 3 equal parts and paid before the 25th day of each month of the next quarter.
VAT returns are submitted 4 times a year - before April 25, July 25, October 25 and January 25. The peculiarity is that this report is submitted only in electronic form. You cannot fill out a paper form and bring it to the Federal Tax Service or send it by mail. In this case, it is considered that the declaration has not been filed. This rule also applies to “zero” VAT returns.
Required deadlines
An individual entrepreneur working on the main taxation system must pay the taxes imposed on him within the time limits established by law. When completing quarterly reporting, please note that the deadline for filing it depends on the reasons for choosing and filling out the form used.
When submitting quarterly VAT reports, reports must be submitted within 5 days after the end of the last month.
Important! The deadlines for preparing such reports are established only for the first month of profit.
For other cases, the Tax Code provides for the following deadlines this year during which VAT must be paid quarterly:
- 4 for the past year until 01/25/2019;
- 1 until 04/25/2019;
- 2 until July 25, 2019;
- 3 to 10/25/2019.
Reporting for the 4th quarter of the current period will be required at the beginning of 2021. The declaration must be submitted no later than January 27 of the following year.
Additional Information! If the last day for submitting reports falls on a holiday or weekend, the due date is postponed to the first working day after them.
Not only reports on receipt of income and profits must be submitted, but also zero reporting, on the basis of which one can legally avoid paying taxes.
Property tax for individuals
Property tax is levied on real estate that an individual entrepreneur on OSNO uses in his business. This could be an apartment, a room, a residential building, including an unfinished construction project, an outbuilding or structure, a garage, or a parking space. The tax rate varies from 0.1% to 2%.
Property tax is calculated by inspection specialists. The entrepreneur receives a notification and makes payment no later than December 1 of the following year. This tax is not reported.
Taxes OSNO
The general taxation system for individual entrepreneurs involves the following list of mandatory taxes:
- personal income tax (NDFL) - is made on all payments to employees (individuals) and is 13%;
- personal income tax for individual entrepreneurs - 13%;
- value added tax (VAT) - from January 1, 2019, 20% (in general) and 10% (for sales of a certain category of goods). Let us remind you that until January 1, 2021, the VAT rate in general was 18%;
- contributions to the pension fund (22%);
- contributions to the social insurance fund in case of temporary disability (2.9%);
- contributions for compulsory social insurance against industrial accidents and occupational diseases (from 0.2% to 8.5%);
- contributions to the compulsory health insurance fund (5.1%);
- transport tax - depends on the power of the car engine;
- land tax - (from 0.3 to 1.5%);
- corporate property tax - average annual value of property (2.2%).
Depending on the type of business activity, individual entrepreneurs and organizations on OSNO may additionally pay:
- excise taxes;
- mineral extraction tax;
- water tax;
- fee for the use of aquatic biological resources.
- fee for the use of fauna objects.
Personal income tax for employees
If an individual entrepreneur is an employer or hires individuals under civil contracts, he must transfer personal income tax to the budget from the payments he makes to them.
The tax is paid from the amounts accrued to the individual. The order is:
- income subject to personal income tax is calculated;
- the amount of tax is calculated taking into account the deductions due to the employee (Articles 218-220 of the Tax Code of the Russian Federation);
- the amount received is withheld from income and transferred to the budget no later than the next day.
Certain types of income have their own tax payment deadlines. For example, personal income tax on sick pay or vacation pay must be transferred by the end of the month in which they were paid. Personal income tax reporting for employees is submitted in the form of calculation 6-NDFL - at the end of each reporting quarter, no later than the last day of the next month.
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Unified simplified declaration of individual entrepreneurs on OSNO
It can be submitted only in cases where the individual entrepreneur did not conduct business on OSNO and there were no turnovers .
A single simplified declaration cannot replace a zero 3-NDFL, so it can only be submitted instead of a VAT report. This is convenient if, for example, the individual entrepreneur does not have an electronic signature. Unlike the VAT return, a single simplified return can be submitted in paper form.
The deadline for submission is 20 days after the reporting quarter.
The form was approved by the Order of the Ministry of Finance of the Russian Federation dated July 10, 2007. No. 52n.
single simplified declaration doc xls pdf
Read more about filling out a single simplified declaration.
Insurance premiums for individual entrepreneurs for themselves
Every entrepreneur, regardless of the tax regime he has chosen, pays the following contributions for his insurance:
- Medical. In 2021 - 8,426 rubles.
- Pension. The contribution amount consists of two parts. The first part is fixed - 32,448 rubles for the full year 2021. If an entrepreneur’s income does not exceed 300,000 rubles, he pays only this part. If his income is greater, then he pays 1% on the excess amount. Individual entrepreneur on OSNO to calculate this amount reduces the income received for professional deductions.
Medical contributions and the first part of pensions are paid during the calendar year. The estimated portion of pension contributions must be transferred no later than July 1 of the following year. Reporting on individual entrepreneurs' own contributions is not submitted.
Declaration 4-NDFL for individual entrepreneurs
The activities of any individual entrepreneur on the OSN usually begin with this declaration.
The fact is that during the year an entrepreneur on OSNO must pay advances on personal income tax. Tax inspectors calculate them from last year's income of the entrepreneur and send him a notification. But if the individual entrepreneur has just started working for OSNO, there is no income data yet. Therefore, in order for advance payments to be calculated, after receiving his first income, he must submit a 4-NDFL tax return with his estimated income for the current year.
The form is very simple, you only need to enter the details of the individual entrepreneur and the amount of expected income.
Since 2021, a new form of the form has been in force, approved by Order of the Federal Tax Service of Russia dated December 27, 2010 No. ММВ-7-3/ [email protected] .
4-NDFL doc xls pdf
Read more about how to fill out the 4-NDFL declaration.
The period for provision is 5 days after the expiration of a month from the date of receipt of the first income.
2019 was the last year when OSNO entrepreneurs had to fill out 4-NDFL. Since 2021, the algorithm for calculating advance payments has changed - now they will no longer be calculated by the tax office, but by the entrepreneur himself on OSNO based on actual indicators for 3, 6 and 9 months of the year. Therefore, there is no need for a 4-NDFL report .
Thus, you will have to submit this form if only by the end of 2021 you manage to receive your first income as an entrepreneur on OSNO.
Individual entrepreneur reporting forms
In conclusion, we list what kind of reporting an individual entrepreneur submits with his employees. It does not depend on whether the entrepreneur chose the main tax system, simplified tax system, UTII, unified agricultural tax or patent. If there is at least one hired employee, the individual entrepreneur is required to take:
- Calculation of insurance premiums. Submitted to the tax office at the end of the quarter by the 30th of the next month.
- Forms of personalized accounting. SZV-M is submitted to the Pension Fund every month, the submission deadline is the 15th of the next month. At the end of the year, before March 1, the SZV-STAZH is submitted along with the EDV-1 form.
- 4-FSS. Submitted to the Social Insurance Fund every quarter. Deadlines: in paper form - until the 20th day of the month following the end of the quarter, in electronic form - until the 25th day.
What reports need to be submitted to individual entrepreneurs in the general mode?
The general taxation regime involves the payment of the following taxes:
- for added value;
- profit - for organizations,
- income of individuals - for individual entrepreneurs, lawyers, notaries and other individuals who have undergone appropriate registration with the tax authority.
Declarations regarding the calculation of these taxes must be submitted to the tax authorities. Thus, the main reporting of individual entrepreneurs on OSNO includes a VAT declaration and a declaration in form 3-NDFL. Let's look at each of them in more detail.
Reports on the main tax - personal income tax
Declaration 3-NDFL is submitted once a year. For reporting for 2021, this form has undergone minor changes (approved by order of the Federal Tax Service dated 10/03/2018 No. ММВ-7-11/ [email protected] as amended on 10/07/2019). Read more about changes to the form here.
The deadline set for sending the declaration to the tax office is April 30 of the year following the reporting year.
Due to the coronavirus, tax authorities have extended the acceptance of returns for 2021 until July 30, 2020.
Regardless of whether the entrepreneur received any income during the reporting year or not, he will have to report on personal income tax. That is, 3-NDFL is submitted with zero indicators.
Until the end of 2021, entrepreneurs in the general regime were assigned the obligation to submit another form to the tax authorities - 4-NDFL. It was handed over to:
- entrepreneurs who have just started their activities;
- former special regime officers who were “dismissed” from the simplified tax system, UTII, PSN due to exceeding certain indicators;
- Individual entrepreneurs whose income from their core activities has changed by more than 50%.
Starting from 2021, there is no need to submit 4-NDFL, since entrepreneurs now calculate advances based on actual income received rather than estimated income.
Attention! Recommendation from ConsultantPlus: Calculate and pay advance payments throughout the year (clauses 7, 8, Article 227 of the Tax Code of the Russian Federation). The calculation of the advance payment must be made based on the results of the first quarter, half a year and nine months using the following formula... (for detailed information on the new procedure for calculating advances, see K+).
VAT declaration
The VAT declaration form is the same for organizations and entrepreneurs. It was approved by order of the Federal Tax Service of Russia dated October 29, 2014 No. ММВ-7-3 / [email protected] (as amended on November 20, 2019).
The declaration includes a title page and 12 sections. However, you do not need to fill them all out and submit them all at once. Only those for which there is data to fill out are subject to submission to the tax authorities. The material VAT Declaration for Individual Entrepreneurs on OSNO will help you fill out the form correctly.
In the case of submitting a zero report, the entrepreneur will only have to fill out the title page and section 1. For the procedure for filling out the zero report, see here.
The declaration is submitted quarterly, since the tax period for VAT is a quarter. The report must be sent to the tax authorities by the 25th day of the month following the reporting quarter.
IMPORTANT! Sending a VAT return by general regime employees to the inspectorate is carried out exclusively in electronic form. A paper return for such taxpayers is considered unsubmitted.
Individual entrepreneur reports on property taxes
Individual entrepreneurs on OSNO pay taxes on property, land and transport like ordinary individuals. But entrepreneurs do not submit reports on these taxes.
The tax office itself calculates taxes based on the data they have and sends notifications to individual entrepreneurs with the amounts and deadlines for payment.
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