The legislation provides for the need to conduct preliminary (before hiring), periodic and extraordinary medical examinations, paid for from the employer’s funds. But if for any reason the employee underwent such a medical examination at his own expense, the enterprise must pay him appropriate compensation to reimburse the expenses incurred. This article discusses how insurance premiums are calculated from compensation for a medical examination, whether such compensation is subject to taxes, and other related issues.
Procedure for conducting a medical examination
The legislation establishes the need for the following types of medical examinations:
- preliminary - carried out with the aim of checking the health of the future employee during the process of his registration at the enterprise, for compliance with the expected job duties;
- periodic – carried out at various intervals (from a year or more), depending on the harmfulness of production and the characteristics of the employee’s workplace;
- extraordinary - the need for such a medical examination may be due to a change in health status; it can be carried out at the initiative of the employee or the enterprise.
Any of the listed medical examinations must be carried out at the expense of the enterprise where the employee is employed. For certain categories of personnel, a pre-trip medical examination is provided. This applies to vehicle drivers, representatives of the catering system and other employees on whose physical condition the lives of other people directly depend.
Medical examinations are carried out by an accredited medical organization with which the company has entered into a corresponding agreement. The company must pay the employee for the time spent undergoing a medical examination.
simplified tax system
The tax base of simplified organizations that pay tax on income, expenses associated with mandatory medical examinations will not be reduced (clause 1 of Article 346.18 of the Tax Code of the Russian Federation).
If an organization pays a single tax on the difference between income and expenses, then the reflection of the costs of medical examinations when calculating the single tax depends on the sources from which they were paid:
- at the expense of the organization;
- at the expense of contributions for insurance against accidents and occupational diseases (if such a possibility is provided for by the rules for spending insurance premiums approved by the Ministry of Health and Social Development of Russia for the current year).
When calculating the single tax, include the costs of mandatory medical examinations at the expense of the organization as part of material expenses (subclause 5, clause 1, clause 2, article 346.16, subclause 6, clause 1, article 254 of the Tax Code of the Russian Federation). Similar conclusions follow from the letter of the Ministry of Finance of Russia dated February 24, 2014 No. 03-11-11/7618.
Situation: can an organization providing catering services take into account the costs of medical examinations of employees as part of its expenses? The organization applies a simplified tax system and pays a single tax on the difference between income and expenses.
Answer: yes, it can.
Simplified organizations that pay a single tax on the difference between income and expenses have the right to reduce the tax base by the amount of material costs (subclause 5 of clause 1 346.16 of the Tax Code of the Russian Federation). These expenses are taken into account in accordance with Article 254 of the Tax Code of the Russian Federation (clause 2 of Article 346.16 of the Tax Code of the Russian Federation).
Material costs include expenses for payment for services of third-party organizations, including monitoring compliance with established technological processes and maintenance of fixed assets (subclause 6, clause 1, article 254 of the Tax Code of the Russian Federation). Production control includes, among other things, the organization of medical examinations of officials and employees of organizations whose activities are related to the production, storage, transportation and sale of food products and drinking water (clause 2.4 of the Sanitary Rules approved by the Chief State Sanitary Doctor of the Russian Federation on July 10, 2001 of the year).
Thus, for organizations that provide public catering services, medical examinations of employees are mandatory (Article 213 of the Labor Code of the Russian Federation). The costs of carrying them out should be taken into account when calculating the single tax as part of material costs.
Insurance premiums for medical examinations of employees
If an enterprise pays for the services of a medical organization under a direct contract, these deductions should not be subject to insurance premiums. Such clarifications were provided by the leadership of the tax department of the Russian Federation.
Article on the topic: Features of calculating insurance premiums
Is compensation for a medical examination subject to insurance premiums?
If an employer pays compensation to an employee for a self-paid medical examination (such situations often arise when applying for a job), the Ministry of Finance and the Tax Service believe that this compensation should be subject to insurance premiums.
This is explained by the fact that the list of exceptions for the imposition of insurance premiums is compiled with an exhaustive indication of the positions, but this compensation is not included in it.
But the position taken by these government agencies regarding whether the said compensation should be subject to contributions is quite controversial.
Before the repeal of Law No. 212-FZ, when insurance contributions were the prerogative of the Pension Fund of Russia, courts often agreed with the claims of employers who demanded that these payments not be subject to deductions.
But representatives of the tax service now do not take into account the results of judicial practice of past years. Therefore, if such an issue is not disputed in court, there is no point in taking risks and not taking compensation into account when calculating insurance premiums.
An organization has the right to file a lawsuit to defend its own interests. But you should not count on a positive result of the consideration of the case, since after changes in legislation, such issues are usually considered not in favor of employers.
Additional difficulties during judicial review are also associated with the complexity of the procedure, which can drag on for quite a long time. Therefore, it is easier to pay insurance premiums, and only after that decide on the advisability of going to court.
Example of taxation of compensation for medical examination by insurance premiums
Whether compensation for a medical examination should be subject to insurance premiums can be considered using several specific examples.
In the first of these situations, the administration of the enterprise directly paid for the medical examination with the relevant healthcare organization.
In this case, the costs are classified as production costs, since they are caused by the need to ensure the technological process. Taking into account this circumstance and the requirements of the law, the employer is obliged to pay these expenses, and during the process of going through this procedure, the staff retain their positions and assigned earnings.
Article on the topic: Is it necessary to pay insurance premiums if the activities of an individual entrepreneur were not carried out?
In the following example, the employee underwent a medical examination on his own, and the company subsequently compensated him for the expenses incurred for this.
In this situation, the compensation payment should be subject to insurance contributions for deduction to the state budget. This is explained by the fact that compensation payments are not included in the list of exceptions for withholding insurance premiums.
Personal income tax on the amount of compensation to the employee for medical examination expenses
Employer compensation for employee expenses for medical examination: personal income tax
According to the Labor Code of the Russian Federation, mandatory and periodic medical examinations of employees must be carried out at the expense of the employer. Data on such examinations are entered into the employee’s Personal Medical Record.
The following categories of workers are required to undergo a medical examination:
- food industry, public catering and trade organizations;
- water supply workers;
- medical organizations;
- children's institutions and some other organizations.
In practice, there are 2 situations:
- The employer, at his own expense, pays non-cash for medical examinations of his employees to medical institutions, or issues funds directly to the employee (in cash or transfers to his account) for these purposes.
- The employee pays for the medical examination at his own expense, and the employer later compensates the employee for these expenses.
According to the letter of the Ministry of Finance of Russia dated February 8, 2021 N 03-15-06/7527, in the first case, expenses are exempt from personal income tax, in the second case, the employer is obliged to withhold personal income tax from the amount of compensation to the budget:
the specified income is exempt from taxation in the case of non-cash payment by employers to medical organizations of expenses for the provision of medical services to taxpayers, as well as in the case of issuing cash intended for these purposes directly to the taxpayer (members of his family, parents, legal representatives) or crediting funds intended for these purposes, to taxpayers' bank accounts.
The letter above deals with the first situation, and not with compensation for the expenses actually incurred by the employee for a medical examination.
But at the same time, according to the letter of the Ministry of Finance of Russia dated July 26, 2018 N 03-04-06/52404, the employer in the second case has the right not to withhold personal income tax to the budget:
the amount of reimbursement by the employer for the cost of conducting mandatory medical examinations of employees, the completion of which is determined by the requirements of Article 213 of the Labor Code, cannot be recognized as the economic benefit (income) of the employees; accordingly, income subject to personal income tax does not arise in this case.
The following should be noted: there is a decision of the Oktyabrsky District Court of Samara, Samara Region dated May 13, 2015 No. 12‑232/2015, according to which the employer can be held administratively liable for violating labor protection legislation if he himself does not pay medical examinations to medical institutions, but only compensates these costs to its employees.
Also, according to the letter of the Ministry of Finance of Russia dated September 8, 2014 No. 03-03-06/1/44840, since the costs of medical examinations of employees are mandatory, the employer has the right to take them into account as part of other expenses, thereby reducing the tax base for the tax on profit and not pay personal income tax to the budget on these amounts.
There are also court decisions confirming this position (previously the Ministry of Finance thought differently, such expenses are not subject to personal income tax only if they are carried out by the employer at the expense of net profit, letter of the Ministry of Finance of the Russian Federation dated March 31, 2011 N 03-03-06/1/196 ).
Thus, at the moment: if the employer only compensates the costs of a medical examination to the employee, then if personal income tax is not withheld into the budget, disputes with the tax authorities and administrative liability are possible. If he himself pays for medical examinations of his employees, then personal income tax does not need to be paid in any case.
Medical examination and personal income tax
Regarding whether compensation for a medical examination is subject to personal income tax, the following must be taken into account:
- Only those receipts that are associated with the receipt of income by citizens or organizations can be taxed;
- if the employee received compensation for previously incurred expenses for undergoing a medical examination, such receipts cannot be considered income, since they compensate for losses that were previously present.
When analyzing the above, it becomes clear that compensation payments cannot be subject to personal income tax, since they are not income, but compensate for losses incurred by the citizen.
But it should be understood that a situation in which a future employee is forced to pay for the services of a medical organization himself upon entering work is a direct violation of legal norms. Indeed, in this case, the estimated tax base will be less by the specified amount.
From the analysis discussed in the material, it becomes clear that compensation paid to an employee for independently undergoing a medical examination should be subject to insurance contributions, but is not included in the number of payments from which personal income tax is withheld.
At whose expense are medical examinations performed?
First of all, the Ministry of Finance pays attention to the provisions of Article 213 of the Labor Code of the Russian Federation.
It states, in particular, that workers engaged in heavy work and work with harmful and (or) dangerous working conditions undergo mandatory preliminary (upon entry to work) medical examinations. Moreover, such medical examinations are carried out at the expense of the employer. As you can see, the Labor Code of the Russian Federation does not provide for payment of preliminary medical examinations at the expense of employees’ own funds with subsequent reimbursement of such expenses by the employer. Therefore, we can talk about personal income tax and contributions from the amounts paid for medical examinations in the case when the employer himself transfers the money directly to the medical institution or issues (transfers) money for these purposes to the employee himself.
