Position of official departments
The ambiguity in the accruals was due to the fact that the regulatory documents do not have the concept of “non-working days”. Accordingly, it was not specified whether payments for this period should be taken into account in calculating average earnings or not. Before the official letter of the Ministry of Labor No. 14-1/B-585, issued on May 18, 2020, it was explained on the Rostrud website that non-working days are not excluded from the calculation period, and payments made are taken into account when calculating vacation pay. However, later officials came to a unanimous opposite opinion:
- wages for non-working paid days should not be included in the calculation of average earnings;
- the billing period is reduced by non-working paid days.
The Ministry of Labor explains this decision by the fact that payment for non-working periods is other cases of release from work with retention of salary, excluded from the calculation, according to paragraphs. “e” clause 5 “Regulations on the procedure for calculating the average salary” (approved by Government Decree No. 922 of December 24, 2007). Thus, employers who previously used the Rostrud methodology will be faced with the need to recalculate vacation pay for 2021.
Cheat sheet for calculating salaries, vacation pay and sick leave
The general procedure for calculating payment for annual leave provides that the average salary for vacation pay is calculated for the last twelve months by dividing the total income for this period by the amount of days worked. There are cases when it is necessary to recalculate payments for various reasons, which sometimes do not depend on the employer.
As a rule, the issue of recalculation arises in the following cases:
- payment of annual bonus next month;
- salary changes;
- recall from annual paid leave;
- illness of an employee while on vacation;
- dismissal of an employee;
- counting error.
This is important to know: Leave for irregular working hours in the police (MVD)
If the employee himself finds out that vacation pay was accrued incorrectly, or the accountant noticed a mistake, then a recalculation must be made without the employee’s application.
Recommended calculation procedure
The calculation algorithm itself has not changed. The calculation stages consist of the following steps:
- the number of calendar days in the billing period (RP) is determined, that is, for the 12 calendar months preceding the month the vacation began. In this case, excluded days are deducted (for example, vacation at your own expense, business trip, downtime, temporary disability, etc.). If the month is fully worked, the average monthly number of calendar days is used in the calculation - 29.3 (Article 139 of the Labor Code of the Russian Federation), for months not fully worked, paid days are calculated proportionally;
- the income taken into account is summed up (amounts not related to remuneration for labor or calculated based on average earnings are not included);
- The average daily earnings are determined by dividing the amount of income by the number of days in the RP;
- the number of vacation days is multiplied by the average daily earnings - the amount of vacation pay is obtained.
When paying, the accounting department withholds personal income tax from vacation payments.
The only new rule that needs to be taken into account if the employer decides to be guided by the opinion of the Ministry of Labor is to exclude from the calculation of average earnings days and payments falling during the non-working period from March 30 to May 8, 2021.
An example of vacation pay recalculation for April 2021.
The salary of mechanic Smirnov is 18,000 rubles. On March 30 and 31, Smirnov, like all company employees, did not work. For the entire period from April 1, 2021 to March 31, 2021, earnings were accrued to him in full (including for non-working days on March 30 and 31). In April 2021, Smirnov goes on vacation for 28 days.
How the company initially accrued vacation pay to the employee (according to Rostrud’s methodology):
- salary for RP: 18,000 x 12 months. =216,000 rub.;
- average daily earnings: 216,000 / 12 months. / 29.3 = 614.33 rubles;
- vacation pay: 614.33 x 28 days. = 17,201.24 rubles;
- personal income tax withheld 13%: 17201.24 x 13% = 2236 rubles;
- Smirnov was given the amount of vacation pay in hand: 17,201.24 – 2236 = 14,965.24 rubles.
In May, the accounting department had to recalculate vacation pay for April after the Ministry of Labor issued clarifications:
- Non-working days are excluded from the RP - March 30 and 31; accordingly, the number of calendar days for calculating the average salary will change:
29.3 x 11 months. + 29.3 /31 days (calendar days in March) x 29 days. (worked by Smirnov in March 2021) = 349.7 days;
- The salary taken into account will decrease by the amount for 2 non-working days:
18,000 x 11 months + 18,000 / 21 work. days March x 19 working hours days in March = 214,285.71 rubles;
- Smirnov’s average daily earnings will be:
214 285, 71 rub. / 349.7 = 612.77 rub.
- employee's vacation pay: 612.77 x 28 = 17,157.56 rubles;
- Personal income tax on recalculated vacation pay will decrease: RUB 17,157.56. x 13% = 2230 rub. (i.e. 6 rubles were withheld excessively);
- The employee should have received: 17,157.56 – 2230 = 14,927.56 rubles.
Thus, Smirnov’s vacation pay became less: instead of 14,927.56 rubles. he received 14,965.24 rubles. The overpayment amounted to: 14,965.24 – 14,927.56 = 37.68 rubles.
As a result of recalculation of vacation pay for April, May, June 2021, the amount may not only decrease, but also increase. This will happen if accruals for March, April, May (specifically for the non-working period) have become smaller, for example, due to the lack of bonuses. Therefore, it is impossible to say for sure who will win in the end - the employee or the company. The amount of charges depends on each specific case. We described earlier in our article how to correct errors in the case of incorrectly accrued vacation pay.
Order for recalculation of wages
There is no unified form for an order for an upward recalculation, but such a document typically contains:
- name of the organization, if the order is not issued on letterhead;
- date and order number;
- a brief statement of the situation, the basis for issuing the order;
- Instructing an accountant or other responsible person to make a recalculation;
- Full name of the general director, his signature.
If recalculation is made downwards, you need to pay attention to the following points:
- Reducing your salary is possible only in situations strictly defined by law.
- The salary reduction is made by deductions for unearned advance payments, travel allowances, vacation days, due to a calculation error (Part 2 of Article 137 of the Labor Code of the Russian Federation).
- The employee's written consent to deductions from wages must be obtained.
- If, due to the fault of the employee, there was a failure to comply with labor standards or downtime, the conclusion of the labor dispute commission must first be obtained, which confirms these facts.
- If the enterprise is planning organizational events, as a result of which the salary will be reduced, then 2 months before their start, all employees must be notified and their signatures must be collected.
We offer for your reference a sample order for deduction from salary, since this situation is most often encountered in the work of an enterprise: Sample order for deduction from salary.
Who does not need recalculation of vacation pay for April, May, June
Recalculation will not be required for companies and individual entrepreneurs that continued to work during the period of self-isolation from March 30 to May 8, 2021. After all, employees received wages, these days were actually fully worked, and accordingly, vacation pay was accrued correctly.
Employees who worked remotely during the self-isolation period will also have vacation without recalculation of vacation pay.
The employer may not make a recalculation if the interests of the employees are not affected - that is, in the case when the vacation pay turned out to be more than if the non-working period was excluded. However, in this case, there may be risks of illegally accounting for expenses in the taxable base for income tax or under the simplified tax system “income minus expenses.”
General rules for correcting errors in vacation pay
The rules for correcting errors and the procedure for disclosing information about them in accounting and reporting are established in PBU 22/2010 (approved by order of the Ministry of Finance dated June 28, 2010 No. 63n).
According to paragraph 2 of this standard, inaccuracies in calculations are qualified as an incorrect reflection (non-reflection) of the facts of economic activity, that is, as an error.
Errors may be significant or insignificant. This is determined by how the error affected the overall indicators of the reports in which it was included.
Skewed indicators associated with an error in accruing vacation pay to 1 or 2 employees should hardly be considered a significant error.
For minor errors, PBU 22/2010 provides the following correction procedure:
- The error must be corrected (correct accounting entries must be made) in the month in which it was discovered.
- Profit or loss resulting from correction of an error must be reflected as part of other income or expenses of the same period (in which it was corrected).
How will recalculation of vacation pay affect personal income tax?
Additional payment for vacation pay is subject to personal income tax in accordance with the general procedure. The tax is charged on the difference between the previously accrued amount and the recalculated amount.
Example
From May 12 to May 31, 2021, the company has extended paid non-working days for all employees, because... In the region of operation, the self-isolation regime was extended until the end of May. According to the vacation schedule, engineer Mikhailov’s annual vacation begins on June 1, 2021. Vacation pay was accrued to him in advance in the amount of 25,260 rubles. When transferring, personal income tax was withheld at 13% - 3284 rubles. Mikhailov received 21,976 rubles in his hands.
Based on clarifications from the Ministry of Labor, the company recalculated vacation pay for June 2021, excluding the paid non-working period. As a result, the amount of the engineer’s vacation pay increased and amounted to 26,120 rubles.
Amount to be paid additionally: 26,120 – 25,260 = 860 rubles. It was decided to transfer it to the employee’s card. When paying, the company withheld personal income tax of 13%, taking into account the previously withheld tax:
26,120 x 13% - 3284 = 112 rubles.
As a result of the recalculation of vacation pay for June, Mikhailov received an additional 748 rubles. (860 -112). The company transferred the tax on May 29, 2020 in the total amount: 3284 + 112 = 3396 rubles.
The deadline for transferring personal income tax on vacation pay is the last day of the month in which they are paid to the employee (clause 6 of Article 226 of the Tax Code of the Russian Federation). Therefore, when transferring tax, the payment document indicates the month when the company pays the surcharge. For example, if, when recalculating vacation pay for May, the company paid the difference to an employee in June, the tax on this difference must be transferred by the end of June.
It is more difficult to reduce the amount of vacation pay. In this case, an overpayment occurs - both for vacation pay and personal income tax. It can be taken into account when withholding overpaid funds from the employee, which can only be done with the written consent (application) of the employee. Overpayment of personal income tax can either be returned to the employee upon his application, or offset against future periods.
How to write?
You must write an application for payment or recalculation of vacation pay, as well as in case of delay in benefits, on a blank A4 sheet of paper.
This can be done manually or by typing text on a computer. In this case, the color of the paste does not matter much, so both blue and black are allowed. It is also not clearly defined whether the document should be filled out in capital letters or block letters. The font and size of the printed version are also not important.
At the end of the application there must be a date and signature of the employee.
Sample
The application for vacation pay, a sample of which you can see below, is filled out quite simply. It is written in the name of the head of the company, whose name and position are indicated in the header of the application. After this, write the name of the employee planning to go on vacation.
The text of the application itself must include the terms of paid vacation.
In cases where there is a delay in vacation pay, the employee must also first write an application addressed to the employer before contacting the labor inspectorate.
In it, he must notify of the violation of his right to paid leave, and also indicate the possible consequences, that is, appeal to higher authorities if the problem is not eliminated in the near future.
A sample vacation application is here.
A sample application to the Labor Inspectorate regarding violation of rights is here.
