Losses of previous years identified in the reporting period

From this article you will learn:

What does retained earnings mean?
How is retained earnings formed?
What can retained earnings be used for?
What to do with retained earnings when liquidating an LLC

Retained earnings of an LLC represent income received from business activities after taxes - it must be distributed among the participants of the company, taking into account the size of their shares and contributed capital. This concept can mean both additional income and losses incurred by the enterprise. Next we will talk about the intricacies of distributing funds in accordance with the law.

What does “retained earnings of an LLC” mean?

Retained (or accumulated) profit is the funds remaining after the enterprise has paid taxes, dividends, fines, and other obligatory payments.

Speaking about this concept, one cannot fail to mention net profit, because they are closely related. So, if a company does not have deferred tax liabilities and there were no dividends accrued during the year, these indicators turn out to be the same in annual reporting. The difference is that net profit is taken into account only in documents for the reporting period, and undistributed profit is also taken into account for the entire period of the LLC’s operation on the market.

Let’s say right away that in accounting and economics, the concepts of retained earnings of an LLC have different uses. For the accountant, we are talking about the result of the work, indicated in the reporting on account 84. In this case, the amount is not actually distributed, since the business owners must decide where the retained profits of the LLC can be sent from March 1 to June 30 of the next year. From an economic point of view, these funds are considered for the past year after the date we named, that is, after all deductions have been made.

There is an opinion that retained and net profit are identical concepts. Indeed, retained earnings are net profits that (as the name suggests) are not divided among the members/shareholders of the LLC. Net profit is that portion of income from sales and non-sales operations that remains in the company after taxes have been paid.

Let us remind you that only the owners have the right to decide where to spend the retained profits of the LLC. This issue is traditionally discussed at the annual meeting of the company's owners, after which the decision is formalized in the form of minutes drawn up based on the results of the general meeting of shareholders.

Typically, these funds are directed to:

payment of dividends to participants/shareholders;
repayment of losses;
replenishment (creation) of reserve capital;
other goals formulated by shareholders.

Retained earnings on the balance sheet are its liabilities. This indicator represents the actual debt of the company to its owners, because ideally there should be a distribution of retained earnings in the LLC, that is, between the participants of the company, and its investment in the development of the enterprise.

Let us repeat that the company is deprived of the right to dispose of these funds without a corresponding decision of the owners. If we are talking about a loss reflected in line 1370, it also refers to the liability side of the balance sheet. However, it has a negative value, so it is formatted with parentheses.

Federal Law on loss transfer

Tax loss is the excess of tax expenses over tax revenues.
It is allowed to be taken into account when calculating income tax (clause 8 of Article 274 of the Tax Code of the Russian Federation). How? The loss can be carried forward, that is, the taxable profit of the following reporting (tax) periods can be reduced by it. The main condition is to transfer it to the future, that is, you can only reduce profits taxed at a rate of 20% (paragraph 1, clause 1, article 283 of the Tax Code of the Russian Federation).

There is also a requirement for the amount of loss. The transferred loss must be such that the tax base for the profit of the period of transfer is not reduced by more than 50% (Federal Law of November 30, 2021 No. 401-FZ). This restriction is valid until December 31, 2021 (Federal Law of September 29, 2021 No. 325-FZ).

How is the retained profit of an LLC formed?

Regardless of whether the result from the sale of products or the provision of services is positive or negative, it is reflected in the active-passive account 90 “Sales”. The debit of the account shows the full cost, VAT and other costs, while the credit shows revenue. The final balance is transferred to account 99 “Profits and losses”.

The following entries must be made in the ledger:

Dt90Kt99 – profit made;
Dt99Kt90 – loss received.

The enterprise's operations, including operating and non-operating ones, must be displayed on account 91 “Other income and expenses”. These include:

Sale and rental of company assets.
Depreciation and revaluation of non-current assets.
Transactions with foreign currency.
Investments in shares of the business of other companies.
Liquidation and donation of property.
Income and expenses from transactions with securities.

The following wiring can be used:

Dt91Kt99 – profit made;
Dt99Kt91 – loss received.

The procedure for writing off the totals for accounts 90 and 91 is called balance sheet reformation. Let us say right away that by this term many economists understand the direct distribution of accumulated profit from account 84.

Similarly, the balance from accounts 76 “Extraordinary income and expenses” (for example, insurance compensation or losses from natural disasters) and 10 “Materials” (the cost of accepted inventory items unsuitable for use in production) is transferred to account 99.

An LLC's retained earnings may increase if accounting errors are discovered that cause expenses to be overstated. This also happens when dividends are not claimed by shareholders, provided that more than three years have passed from the date of their accrual. And, conversely, if errors were made in the reporting that caused the profit to be overstated, they reduce the accumulated income.

When conducting an economic analysis, we must not forget that retained earnings do not always consist of financial assets represented in cash or stored in a current account, because the markdown of principal amounts increases profit, but does not add money.

At the end of the reporting year, the chief accountant writes off the final balance (profit or loss) from account 99 to account 84 “Retained earnings”.

To do this, the following postings are made:

Dt99Kt84 – upon receipt of profit;
Dt84Kt99 – upon receipt of a loss.

Next, account 99 is reset to zero, and no transactions are carried out on it until the onset of the new year. Whereas the score 84 is considered active-passive. Before entering the total of the accumulated profit of an LLC into the report, the amount of income tax is subtracted from it; the latter may subsequently undergo changes.

Income of previous years identified in the reporting period, postings in 1c

The main goal of any commercial organization is to make a profit. But it often happens when the expenses incurred by an enterprise exceed the income received, and the financial result of the organization is a loss. You will learn from our article how to reflect losses in transactions and how losses of the reporting and previous periods should be recorded. Content

1 How to determine a loss at the end of the year
2 Reflection of losses in accounting

2.1 Current year losses
2.2 Postings for losses from previous years
2.3 Covering losses using reserve capital

How to determine a loss at the end of the year Its financial result—profit or loss—depends on the production and economic activity of an enterprise. To obtain the final result, the main and other activities of the company should be taken into account.

Retained earnings of previous years in accounting

Retained earnings from previous years.

In this case, there are two possible accounting methods:

cumulative;
weather

The first option involves dividing the amount into the reporting and previous years without opening separate sub-accounts for account 84. That is, funds are accumulated on an accrual basis from the start of the LLC’s operation on the market. If a loss occurs, it is automatically covered by the profit of previous years. This approach is usually used in small businesses.

The second accounting option is distinguished by the use of separate sub-accounts for synthetic accounting of funds in different periods.

Various options for second-order accounts are allowed:

account 84.1 – retained earnings of the reporting year;
account 84.3 – retained earnings from previous years.

The amount received for previous years is, in any case, taken into account when calculating the results for the reporting year.

To obtain detailed information, information is required from sources such as:

an explanatory note that may be attached to the balance sheet (does not apply to small enterprises);
accounting entries for account 84;
reporting for previous years.

If errors are found in the calculation of profit or loss for previous years, they must be taken into account in the financial result for the reporting year.

For the current year.

An LLC can open sub-accounts to account 84 if it is necessary to reflect funds for the current year in accounting:

1 – profit received;
2 – retained earnings;
3 – profit used.

To reflect the positive result obtained for the current year, use the posting Dt84.1Kt84.2. Postings involving account 84.3 mean that the retained earnings of the LLC participants were used for various purposes.

Regardless of the chosen accounting option, the last entry for the reporting year in the General Ledger will be a write-off from account 99 to account 84. Profit tax and interim dividends or payments (if any for the reporting period) have already been calculated from this amount.

The following wiring is done:

Dt99Kt68 – tax calculation;
Dt84Kt75 (or Kt70) - calculation of dividends (account 70 - bonuses for employees).

Some accountants highlight separate lines 1372 and 1372 in the balance sheet to separate the indicators of retained earnings for the reporting period and previous years.

Since the exclusive right to use the accumulated funds belongs to the owners of the company, it is convenient for them to highlight this financial indicator in the balance sheet for different years. We emphasize that it is impossible to fully distribute the accumulated profit of the past year without taking into account the previous results of the LLC’s work.

Important!

The value of the company's net assets after the transfer of retained earnings of the reporting year for the payment of dividends cannot become less than the size of the company's authorized capital even if there is a reserve fund. The caution applies to situations in which uncovered losses were recorded in the financial statements for previous years. Only the owners of the company can decide to cover last year’s losses from the accumulated funds of the reporting year.

The amounts remaining for previous years can be distributed by the owners both at the end of the year and at any other time. To do this, you need to hold a thematic meeting and approve the appropriate decision.

How to take into account the profits of previous years identified in the reporting year

Info

Let us assume that at the end of 2009 the organization received a profit from the sale of goods (works, services) in the amount of 300,000 rubles. both in accounting and tax accounting. The organization did not have any other income or expenses (besides the identified expenses of previous years).

In such a situation, the amount of income tax for 2009 will be 60,000 rubles. (RUB 300,000 x 0.20), the amount of overpayment of income tax for 2007 is RUB 2,160. (9000 rub. x 0.24). In the accounting records for 2009, we have the following final entries: D-t of account 90 - K-t of account 99 - 300,000 rubles. — profit from sales of the current year is reflected; D-t of account 99 - K-t of account 91 - 9000 rub. — reflects the total amount of other expenses of the current year.

What can you spend the retained earnings of an LLC on?

The procedure for distribution of profits is established by the Laws on JSC and LLC. Thus, for accounting purposes, expense items of undistributed funds are specified only in an annotation to account 84 in the Chart of Accounts. There are no other references in accounting to possible ways of using this financial indicator. This means that unallocated funds can be used in such areas as:

Reserve fund.

By law, JSCs are required to invest net profits in the formation of a reserve fund. Moreover, the size of the latter cannot be less than 5% of the authorized capital of the company. These funds are used to cover losses, repurchase public shares, and repay own bonds.

Unlike joint stock companies, LLCs have the opportunity to create a reserve fund on a voluntary basis. The size of the reserve, the amount of contributions made to it each year and the purposes for which this money can be directed are established by the Charter of the company.

The reserve fund is created by posting:

Debit 84 “Retained earnings (uncovered loss)” Credit 82 “Reserve capital”.

It is reflected in the balance sheet in section II “Capital and reserves” on page. As a result, part of the net profit is actually transferred to another item of capital. At the same time, the structure of the balance sheet improves, because the owners are deprived of the right to withdraw funds from the turnover of the enterprise in the amount of the formed fund. In other words, the reserve fund is a kind of financial safety net for the company.

Dividends.

The amount not spent on the formation of the reserve fund can be used to pay dividends. Let us note that this is the most typical and frequently used method of spending such funds. Retained earnings are reduced when dividends are paid, and when dividends are paid, the company's assets are reduced.

When calculating dividends in accounting, the following entry is used:

Debit 84 “Retained earnings (uncovered loss)” Credit 75 “Settlements with founders.”

This entry allows you to reflect the payment of dividends in cash:

Debit 75 “Settlements with founders” Credit 51 “Current accounts”.

If cash issuance is preceded by withdrawal of funds from the current account, the following entry is used:

Debit 75 “Settlements with founders” Credit 50 “Cash”.

Let us note that the law does not prohibit the payment of dividends in both money and property. According to the norms of the Federal Tax Service of Russia, in the second case, VAT must be charged. However, judicial practice knows examples when arbitrators do not recognize the transfer of property through the payment of dividends as a sale, which means that this procedure is not subject to VAT.

Therefore, if a company does not include in the VAT base the value of property transferred as dividend payment, there is a high probability that such a position will have to be defended in court. But is it worth it?

The organization decides to pay dividends in cash, but to do this it will have to sell the property, subject to VAT on its sale, after which funds can be transferred to shareholders. Thus, in the absence of funds, in any case, you will have to pay VAT before making payments to the owners.

Another situation is possible when dividends are goods or fixed assets that are not subject to VAT. In this case, no tax is charged.

The transfer of property to pay off debt on dividend payments is reflected in accounting in accordance with the following standards:

When transferring goods or finished products:

When transferring a fixed asset:

Where else can you direct the retained profits of an LLC?

Often, answering the question of where to spend the retained profits of an LLC, the owners of the enterprise use these amounts to pay bonuses to staff, purchase fixed assets, provide financial assistance, and create consumption and savings funds. Are all of the above approaches correct?

Let's start by discussing the features of expenses at the expense of profit. The current laws on joint-stock companies and LLCs call the only possible payments from profits payments to the owners. We also note that the Ministry of Finance of the Russian Federation has repeatedly expressed this position: account 84 cannot be used to reflect various types of charitable and social expenses, including payments of material assistance and bonuses.

Costs for holding sports, entertainment, cultural and educational events, organizing recreation, etc., as well as transferring funds to charity from the position of the financial department, are considered other expenses and are recorded in account 91 “Other income and expenses.” In other words, the organization’s expenses do not include only the payment of dividends, while any other investment of assets is considered an expense of the current period.

Therefore, financial assistance, bonuses, and charity expenses can affect the company’s net profit, but only during the period when these expenses are incurred. Please note that they in no way relate to last year's net profit.

Let's summarize: all kinds of payments from net profit are illegal - the only exception is dividends.

Separately, it is worth mentioning the investment of net profit in the formation of a consumption fund. This approach is an echo of Soviet accounting rules, when it was customary to transfer money held in the bank separately from company funds into production development funds. These amounts were spent on the purchase of fixed assets. Today, this answer to the question of where to spend the retained profits of an LLC has lost its relevance.

Nowadays, a company's fixed assets are purchased from a current account by changing one asset to another (fixed asset). We emphasize that account 84 is not used in the postings. This means that the decision of business owners to direct funds to the development of production with the accountant’s entry in the account Debit 84, subaccount “Profit for distribution”, Credit 84 “Reserved profit” does not affect the final balance on the credit account 84.

This entry indicates that this year the owners refused to receive dividends without withdrawing money from circulation. As a result, the company was able to modernize its balance sheet structures, while simultaneously ensuring a more stable financial position. Since the final balance on the credit of account 84 does not change, there are no difficulties in the future distribution of profits by the owners when they are reflected in the company’s balance sheet as undistributed.

Accounting for retained earnings from previous years

Who decides on how to use net profit? How to correctly reflect it on the balance sheet? What explanations does the Ministry of Finance of the Russian Federation give on this matter? Experts from the Legal Consulting Service GARANT auditor, professional accountant Liliya Fedorova and professional accountant Svetlana Myagkova will help you understand these and other issues.

Unused net profit from previous years can be used only for purposes specified by the company's charter or by decision of the general meeting of LLC participants.

The organization does not have the right to reflect other expenses, including those not taken into account for tax purposes, on account 84, but must be reflected on account 91. This also applies to losses from previous years identified in the reporting year.

Justification of the conclusion. Distribution of profits falls within the exclusive competence of the general meeting of participants in a limited liability company (clause 3, clause 3, article 91 of the Civil Code of the Russian Federation, clause 7, clause 2, article 33 of the Federal Law of 02/08/1998 No. 14-FZ “On Limited Companies responsibility" (hereinafter referred to as Law No. 14-FZ)).

The direction of use of the net profit of the reporting year and previous years is determined by the decision of the general meeting, which, in turn, is reflected in the minutes of the general meeting. This is the document defining the procedure for using net profit (clause 6, article 37 of Law No. 14-FZ).

In some cases, net profit may be distributed without an additional decision of the general meeting of the organization’s participants. Thus, the charter of the company may determine for what purposes the company has the right to use the net profit, and may also provide for the procedure for directing the net profit to create reserve and other funds (Clause 1, Article 30 of Law No. 14-FZ), to repay past losses years. The amount of profit allocated for these purposes may also be determined by the charter. However, the decision to allocate net profit for these purposes can also be made by company participants at a general meeting.

The net profit received as a result of the financial and economic activities of a limited liability company may be directed, by decision of the general meeting of participants, to:

— increase in the authorized capital (Articles 17, 18 of Law No. 14-FZ);

— repayment of losses from previous years;

— payment of dividends (Articles 28, 29 of Law No. 14-FZ);

— formation of the organization’s reserve capital (Article 30 of Law No. 14-FZ);

— production development of the organization (for example, expenses for payment of fixed assets);

— creation of special-purpose funds (Article 30 of Law No. 14-FZ):

— social sector fund;

— consumption fund (bonuses for employees, provision of financial assistance), etc.

Retained earnings are an integral part of the organization's equity capital. An organization's capital is the most important characteristic of its economic reporting.

The definition of an organization’s capital is given in clause 7.4 of the Concept of Accounting in the Market Economy of Russia (approved by the Methodological Council on Accounting under the Ministry of Finance of the Russian Federation, the Presidential Council of the IPB RF on December 29, 1997): “Capital represents the investments of the owners and the profit accumulated over the entire period of the organization’s activities "

In other words, the capital of the organization consists of:

— investment capital (authorized capital and additional capital);

- accumulated capital (capital created in excess of what was originally invested by the owners in the organization: retained earnings and reserve capital).

Thus, along with the authorized capital, the profit accumulated over the entire period of the organization’s activities must be reflected in the balance sheet in full for the entire period of its activities, despite the fact that these funds, while in circulation, can be used by the organization in the course of its activities .

In accordance with clause 83 of the Regulations on accounting and financial reporting in the Russian Federation, approved by order of the Ministry of Finance of Russia dated July 29, 1998 No. 34n (hereinafter referred to as Regulation No. 34n), retained earnings (uncovered loss) is the final financial result identified for the reporting period. period, minus taxes and other similar obligatory payments due at the expense of profits established in accordance with the legislation of the Russian Federation, including sanctions for non-compliance with tax rules.

So, retained net profit of previous years represents the remainder of the profit remaining at the disposal of the organization based on the results of work for past reporting years after taxation.

In accordance with the letter of the Ministry of Finance of Russia dated August 23, 2002 No. 04-02-06/3/60, retained earnings from previous years represent that part of the profit that remained at the disposal of the organization based on the results of work for the last reporting year and decisions made on its use (direction to reserves formed in accordance with legislation or constituent documents, to cover losses, to pay dividends, etc.).

Accounting for retained earnings (uncovered loss) is kept on account 84 of the same name “Retained earnings (uncovered loss)” (Chart of accounts for financial and economic activities of organizations and instructions for its use, approved by Order of the Ministry of Finance of Russia dated October 31, 2000 No. 94n).

Analytical accounting for account 84 should provide information on the directions of use of funds. At the same time, in analytical accounting, funds of retained earnings used as financial support for the production development of the organization and other similar activities for the acquisition (construction) of new property and funds of profit that have not yet been used can be divided. In this regard, the organization has the right to open the necessary sub-accounts to this account.

Thus, by decision of the general meeting of LLC participants, documented in the minutes, retained earnings on account 84 can be directed to the purposes specified in the document and reflected by postings to sub-accounts:

Debit 84, subaccount “Retained earnings” Credit 84, subaccount “Direction of funds to…”

- part of retained earnings aimed at financing..., payment..., etc.;

and after use based on the documents:

Debit 84, subaccount “Direction of funds for...” Credit 84 “Use of funds for...”

— reflects the use of funds for... (specify purposes).

According to clause 4 of PBU 10/99 “Expenses of the organization”, the expenses of the organization, depending on their nature, conditions of implementation and areas of activity of the organization, are divided into:

— expenses for ordinary activities;

- other expenses.

Expenses other than expenses for ordinary activities are considered other expenses.

Other expenses are listed in clauses 11-13 of PBU 10/99, which, in particular, include losses from previous years recognized in the reporting year.

Based on clause 80 of Regulation No. 34n, profit or loss identified in the reporting year, but relating to operations of previous years, are included in the financial results of the organization for the reporting year.

In accordance with the instructions for using the Chart of Accounts, other expenses are reflected in the debit of account 91, subaccount “Other expenses”. This instruction does not provide for recording the organization’s expenses on account 84.

Thus, the organization does not have the right to reflect other expenses, including those not taken into account for taxation, on account 84. This conclusion also applies to losses of previous years identified in the reporting year.

This conclusion is confirmed by letters from the Ministry of Finance of Russia dated December 19, 2008 No. 07-05-06/260, dated June 19, 2008 No. 07-05-06/138, dated January 12, 2006 No. 07-05-06/2, dated December 19, 2006 No. 07-05-06/302. We have not found any later letters from the Russian Ministry of Finance with clarifications on this issue.

Increasing the authorized capital of an LLC using retained earnings

If the authorized capital is increased at the expense of the company’s property, its participant does not actually receive funds, goods (work, services) or any other property. Thus, this method of increasing the authorized capital of an LLC does not entail the emergence of income that should be subject to personal income tax.

Let us turn again to judicial practice: there are cases where courts have come to the conclusion that the participants of the company have no income associated with the increase in the nominal value of their shares. This conclusion was considered the only correct one until a company participant exercised any of his property rights, certified by the corresponding share in the authorized capital.

But it is worth noting that this is not the only possible conclusion. According to the position of the Ministry of Finance of the Russian Federation, when the authorized capital increases due to retained earnings, an individual receives income at the time of his state registration. These funds should be subject to personal income tax on a general basis (see, for example, Letter of the Ministry of Finance of the Russian Federation dated May 22, 2017 N 03-04-06/31351).

This position is supported by clause 19 of Art. 217 of the Tax Code of the Russian Federation, which provides for non-taxable income representing the difference between the new and original nominal value of a share in the authorized capital, obtained as a result of the revaluation of fixed assets. At the same time, in Art. 217 of the Tax Code of the Russian Federation, which defines the list of non-taxable personal income tax income, there is no income resulting from an increase in the nominal value of the participant’s share due to retained earnings of previous years.

If an LLC decides to follow the clarifications of the Ministry of Finance of the Russian Federation, it is considered a tax agent for personal income tax, whose responsibilities include: calculating the amount of personal income tax, withholding it from its income upon actual payment, transferring the corresponding amount to the budget (clauses 1, 2, 4 of Art. 226 of the Tax Code of the Russian Federation).

Since in this case the company does not pay the company member any money in the current year, withholding the calculated amount of personal income tax is impossible. Then, according to paragraph 5 of Art. 226 of the Tax Code of the Russian Federation, the enterprise must inform the taxpayer and the tax authority at the place of registration in writing about the impossibility of withholding the tax, the amount of the tax itself and the funds from which it was not withheld. This is given until March 1 of the year following the expired tax period in which the corresponding obligations arose. More detailed information on this topic can be obtained in the “Practical manual on personal income tax”.

When increasing the authorized capital of an LLC using funds from retained earnings, an entry is made in accounting to the debit of account 84 “Retained earnings (uncovered loss)” and the credit of account 80 “Authorized capital” after state registration of changes made to the organization’s Charter. This is required by the instructions for using the Chart of Accounts for accounting the financial and economic activities of organizations, approved by Order of the Ministry of Finance of the Russian Federation dated October 31, 2000 N 94n.

The occurrence of a loss while working in 1C

So, let's consider the first option: the loss in the period arose in the process of working with the 1C: Enterprise Accounting 3.0 program (note that this scheme also works for the previous edition of the 1C 8.3 Enterprise Accounting 2.0 program).

Based on the results of the activities of Moneta LLC in the fourth quarter of 2015, a loss was recorded in the amount of 235,593.27 rubles. In January 2021, a profit was made in the amount of 211,864.41 rubles.

Let's look at the results of document posting for December 2015:

As you know, we obtain the results of an organization’s financial activities as a result of automatic calculations using the Month Closing processing, which includes a list of necessary routine operations (menu Operations – Period Closing – Month Closing ).

As we can see, the resulting loss for December is recognized as a deferred tax asset. The financial result in postings for the month amounted to 245,762.71 rubles:

To see the financial result for the entire tax period, we will generate a reference calculation Calculation of income tax (menu Operations - Reference calculations - Accounting and tax accounting - Calculation of income tax ):

As can be seen from column 10 of the calculation certificate, the loss for the past 2015 amounted to 235,593.27 rubles.

What to do with retained earnings when liquidating an LLC

If a company closes, its profits include all funds reflected in the liquidation or zero balance sheet - this document must be submitted to the Federal Tax Service.

The bulk of the funds should be used to fully/partially repay debts to creditors and pay salaries and all severance benefits to staff that they are entitled to, in accordance with labor legislation.

When closing an LLC, the remaining funds from retained earnings are paid as follows:

payment of retained earnings is made to the founder of the LLC if he is the only participant in the liquidation process;
in the absence of money and the company retains property, the latter, in accordance with the norms of the current legislation and after all priority procedures, goes to the only participant in the process;
the residual funds of the LLC are distributed in equal shares among the participants in the process, if there are more than one.

According to the company's charter, assets are considered property assets, while liabilities include the authorized capital. The LLC structure includes non-current and current assets.

Profit is considered undistributed only after the completion of payments determined by a court decision. If you decide to liquidate an LLC, you need to know the sequence for dividing profits:

First of all.
Paid to the founders if they were accrued their share, but no payment was made.
Second stage.
LLC funds are distributed among the remaining owners in accordance with their shares in the authorized capital.

Actions of the second stage cannot precede the actions of the first, as this will be equivalent to a violation of the law. Please note that the issuance of shares to participants is permitted in any form: in kind, in cash or in the form of another equivalent.

If a legal entity has one owner, all funds of the LLC are transferred to him - this requires a decision of the liquidation commission created to liquidate the company.

The legislation establishes certain time frames for receiving dividends upon liquidation of an enterprise:

standard – after 60 days;
by agreement.

If funds cannot be received on time, the right to payments continues for another three years.

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Retained earnings upon liquidation of an LLC with a single participant

When all payments to creditors are completed, there may be undistributed funds on the balance sheet of the closing company. Therefore, the question immediately arises as to whether it is possible to close an LLC with retained earnings. These amounts must be paid to a single participant.

However, it is necessary to begin with the payment of distributed profits, if any remain. After this, the undistributed amount is paid - if possible, it is done in cash. If for some reason this option turns out to be unacceptable, the sole participant of the company is given the property of the LLC.

That is, the property of the liquidated organization is listed as an asset on the balance sheet, and retained earnings and authorized capital are listed as liabilities.

In order to terminate its activities, the enterprise submits a zero liquidation balance sheet to the Federal Tax Service. This will not be possible without issuing retained earnings to the sole participant in the form of LLC property.

If the value of the property received by the participant turns out to be less than that specified in the authorized capital, these funds are not subject to VAT, and an 18% fee is charged on the balance.