An offshore company instructs an English company, acting as an agent, to conduct a transaction for the purchase and sale of goods and finances the transaction. An onshore company acts on its own behalf, but on behalf of and for the money of an offshore company. Payments are made through the account of an English company, but its income is only the amount of agent (commission) remuneration.
Features of the agent scheme
The agency scheme in tax planning allows you to avoid direct contacts of Ukrainian enterprises with offshore companies. This scheme allows you to conduct activities without violating the requirements of Art. 18.3 of the Law of Ukraine “On Taxation of Enterprise Profits”. This construction of the scheme leads to the fact that the agency company, under an agency agreement, for the money of the offshore principal, on his instructions, in his interests, but on its own behalf, enters into contracts and conducts all business transactions. For this work, the agency company receives an agency fee in the form of commissions (0.5-5%), which will be subject to taxation at the place of registration of the agent.
What is an agency agreement with an individual entrepreneur?
It’s worth starting with the fact that this agreement regulates the relationship between the customer and the contractor. Based on this, it is a type of civil contract. Upon its conclusion, the executor may have the right to enter into transactions or perform a number of other legal actions prescribed in the contract.
At its core, an agency agreement is a replacement for a commission agreement (this will be correct if the agent acts on his own behalf, for example, participates in negotiations or concluding a contract (it may not be indicated that he is an agent)) or a commission agreement (this will be correct if the performer justifies his actions in accordance with the power of attorney issued to him). Based on this, if the contractor acts on behalf of the customer, then all rights and obligations recorded in contracts with a third party will be imposed on the customer.
But, if the agent acts on his own behalf on behalf of the customer, then all rights and obligations will be imposed on him (even if, according to the concluded contract, the customer enters into direct relations with a third party). After the agency agreement is concluded, the contractor assumes the obligation to perform the actions specified in it (if the provisions of the agreement require the performance of legal actions, then this must be supported by an issued power of attorney). The customer, for his part, is obliged to pay for the agent’s services.
contracts with individual entrepreneurs can be found here.
Sample agency agreement with individual entrepreneur
Is it possible to make a deal with him?
In accordance with the provisions of the Civil Code of the Russian Federation (Article 1005), an agreement with an individual entrepreneur can be concluded.
Kinds
There are the following types of blood pressure:
- for the purchase of real estate (usually concluded for the provision of real estate services in a certain region);
- for the purchase of goods (if the agent has connections in the market and can get the goods at a favorable price);
- for the purchase of services (if the agent provides certain services (for example, transport or legal));
- to search for potential clients;
- to sell certain services;
- for the sale of real estate;
- for selling goods.
Accounting
For the performer (agent)
The property received by the contractor from the customer, necessary to fulfill the obligations assumed, does not belong to the agent’s income. All payments for principal amounts can be carried out with the participation of an agent. In this case, the payment procedure itself is prescribed in the contract.
- Accounting for the agent's transactions will take place on account No. 76. Sub-accounts may additionally be opened to it.
- If the agent, under the terms of the contract, must take into account transactions related to material assets, then account 002 “Inventory and materials accepted for safekeeping” is used. At the same time, all valuables received by the contractor do not become his property, and still belong to the customer. Also, the receipt of inventory items for storage may be accompanied by the registration of insurance.
For the customer
It is worth noting that the accounting of the customer’s operations depends on the data displayed in the report by the contractor. So the customer’s income can be all the income received from the transaction. And the expenses will consist of payment for the goods and the remuneration issued to the agent. Companies also use account No. 76, with additional subaccounts assigned to it.
- At the same time, when calculating VAT, since the customer is the owner of the transaction, he uses the amount of tax from the supplier and the performer (agent) for deduction.
- Unlike an agent, in accounting, all receipts from the contractor to the customer are revenue (from the usual type of activity). In this case, the accounts used for accounting will depend on the type of intermediary agreement and the participation of the agent in the calculation.
Requirement for an agency scheme
The onshore company must meet a number of requirements that ultimately determine the “workability” of the scheme. The essence of these is as follows:
- firstly, the jurisdiction from which the agency company originates must, in any case, be absent from the official list of offshore zones approved by Decree of the Cabinet of Ministers of Ukraine No. 106-r dated March 1, 2000;
- secondly, it is desirable to have a double taxation avoidance agreement concluded between the agent’s country and Ukraine;
- thirdly, the country’s legislation should allow the conclusion of direct contracts with offshore companies without compromising the tax status of the agency company (for example, in Estonia an offshore list similar to the Ukrainian one was adopted, which put an end to the active use of local companies as intermediaries in “agency schemes”) .
A number of European jurisdictions meet these criteria, but two of them are the most popular among Ukrainian entrepreneurs - Great Britain, the Czech Republic, and Cyprus.
What needs to be taken into account when creating agency schemes?
It is necessary to take into account the requirements put forward by the tax service to companies involved in agency schemes and the agency scheme as a whole. Failure to comply with these requirements may lead to the recognition of the principal’s income as income of the company (agent) and corresponding taxation.
- Companies must have completely independent business structures. There must be no connection between the agency company and the principal that could compromise the independence of the agent. That is, the principal cannot be a shareholder of the company, the director of the principal and the director cannot be the same person, the principal and the shareholder of the company must not have the same address, etc.
- The provision of agency services must be the main and “ordinary” activity of the company and the agency services must be provided on an ongoing and independent basis. Those. a company cannot provide agency services to only one principal, as this may be considered a violation of the conditions of “ordinary” activities on an ongoing and independent basis and as evidence of the company’s dependence on the principal. Therefore, we recommend using several principals instead of one principal and dividing the agency scheme into several schemes, where different principals participate, to whom agency services are provided by one English company.
- Agency agreements must be concluded and signed between the principals and the onshore company, which clearly states to whom and for the sales of which goods agency services will be provided. Transactions can be carried out only with those companies and for such goods that are specified in agency agreements.
When choosing the country of registration of an agency company, in addition to the main criteria described at the beginning of the article, you should also take into account factors such as the cost of registering and maintaining a company, reporting and auditing, and the possibility of obtaining nominee service.
Work under an agency agreement
While the attorney assumes the obligation to perform certain legal actions, agency activity by virtue of paragraph. 1 clause 1 art.
1005 of the Civil Code of the Russian Federation may be associated with the commission of not only legal, but also actual actions (for example, with the development of a strategy for an advertising campaign for the principal), although “the latter are of an auxiliary nature and never exhaust the subject of the agency agreement” [1].
Otherwise, there will be not an agency agreement, but an agreement for the provision of services for a fee (Articles 779 - 783 of the Civil Code of the Russian Federation).
The importance of correctly distinguishing between these types of actions is also explained by the fact that only legal actions can be performed on someone’s behalf (one’s own, that is, an agent or a principal). Actual actions cannot be performed “on behalf of”, therefore, with regard to such actions, the only important thing is that they are always performed at the expense of the principal.
975 of the Civil Code of the Russian Federation). Remuneration or wages? Under an agency agreement, the agent receives an agency fee for completing the instructions of the principal. It is established in the amount and manner established in the agency agreement.
If there are no conditions in the agreement on the procedure for paying the agent's remuneration, the principal is obliged to pay the remuneration within a week from the moment the agent submits to him a report for the past period, unless a different procedure for paying the remuneration follows from the essence of the agreement or business customs (Article 1006 of the Civil Code of the Russian Federation).
Business ideas from scratch
This allows us to identify the rights of the subjects of such relations, transfer them into the formal legal sphere and thus avoid possible conflicts in the future, or at least define them within a legal framework. Citizens and legal entities are free to enter into a civil contract.
However, this does not mean that in the labor sphere, instead of employment contracts, civil law contracts can be concluded.
The principle of freedom in this case means that coercion to conclude a civil contract is not allowed, except in cases where the obligation to conclude such an agreement is provided for by the Civil Code of the Russian Federation, federal law or a voluntarily accepted obligation (subject to certain conditions).
You can only save on social insurance: insurance against accidents at work and occupational diseases, as well as in case of temporary disability, is not accrued unless this is mentioned in the contract.
The choice depends on the details. To summarize, it should be noted that the preference for one or another scheme involving an agency agreement, as well as the choice in favor of the latter when refusing an employment agreement, depends primarily on the mutual consent of the parties.
Do not forget that any civil contract deprives the performing party of all rights and guarantees that he could claim as a full-time employee of the customer. On the other hand, he is not burdened with requirements for compliance with labor discipline or the need to obey the staffing schedule.
Agency agreement: simple about complex things
Attention
As a rule, agency fees are set as a percentage of transactions concluded (for example, from 2 to 10% of the cost of goods sold).
Under an employment contract, the employee is paid wages at least once every half month in the amount established in the employment contract (Article 136 of the Labor Code of the Russian Federation).
Let us note that if an employer enters into agency contracts instead of employment contracts, he often establishes a percentage form of payment.
However, if this form is combined with a minimum salary that is paid regularly, then in this case the risk of recognizing the contract as an employment contract is more likely, although such a combination in itself generally complies with Art. 1006 of the Civil Code of the Russian Federation. Material liability The next criterion for delimiting these contracts is that only between the parties to the labor relationship questions arise about material liability on the basis of Chapter. 37 - 39 Labor Code of the Russian Federation.
Features and characteristics of the agency agreement
Based on the above definition, at first glance, the similarity of employment and agency contracts may be manifested in the fact that under an agency agreement, the employee undertakes to perform legal and other actions on behalf, including on behalf and at the expense of the principal. At the same time, according to Art. 1011 of the Civil Code of the Russian Federation, the provisions relating to the agency agreement (Chapter 49 of the Civil Code of the Russian Federation) apply to these relations in the part not regulated by the chapter on agency. In particular, we are talking about the execution by the agent of the principal’s instructions.
Art. 973 Civil Code of the Russian Federation. The agent will be obliged to carry out the assignment given to him in accordance with the instructions of the principal. The principal's instructions must be legal, feasible and specific.
- Important
- Legal Resources
- Collections of materials
- Work under an agency agreement
Source: https://law-uradres.ru/rabota-po-agentskomu-dogovoru/
