How to return (offset) an overpayment of personal income tax to an organization - a tax agent?
According to paragraph 7 of Art. 78 of the Tax Code of the Russian Federation, an application for offset or refund of overpaid personal income tax can be submitted within three years from the date of payment of the specified amount, unless otherwise provided by the legislation of the Russian Federation on taxes and fees. Please note that the procedure for the tax agent organization depends on the reason for the overpayment:
- Personal income tax was excessively withheld from the income of an individual and transferred to the budget;
- overpayment of personal income tax arose for other reasons, for example, due to an error in the payment order or transfer of tax earlier than the date of payment of personal income tax to the budget (thereby it is not recognized as a tax).
Let us consider in detail the procedure for returning personal income tax in each of the above cases.
We return personal income tax paid by mistake
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If you decide to offset the erroneously paid personal income tax against future taxes? If yes, then this is a violation of the norms of Ch. 23 of the Tax Code of the Russian Federation, for which you face a fine and penalties. To return the overpayment of personal income tax, submit a refund application to the tax office . At the same time, personal income tax withheld from current payments to individuals should be transferred to the budget in full.
No one is immune from mistakes, and a situation is possible when, when filling out a payment order, an accountant mistakenly indicated the wrong amount of personal income tax that was actually withheld from employees. And in the end, he transferred more to the budget than he should. What to do in such a situation? Some accountants may think that by excessively transferring personal income tax to the budget, there is no need to pay it in subsequent periods. Let's say right away that this is a mistaken opinion. The presence of an overpayment does not in any way relieve the tax agent from the obligation to transfer to the budget in full the amount of tax actually withheld from the income of individuals at a later date.
Essence of the question. Incorrectly paid personal income tax amounts are not considered as tax payments and therefore cannot be offset against subsequent personal income tax payments.
On this occasion, there is a Letter from the Federal Tax Service of Russia dated October 19, 2011 N ED-3-3/ [email protected] In it, tax officials reminded that the Tax Code does not allow the payment of personal income tax at the expense of tax agents (clause 1, clause 3, article 24 and Clause 9 of Article 226 of the Tax Code of the Russian Federation). And money paid by mistake is considered not as personal income tax, but as employer funds. And the tax authorities noted that the amount of tax paid should be equal to the amount that was withheld from the income of an individual. Therefore, if, having transferred money excessively, you do not pay additional personal income tax next month, you may be held liable as a tax agent under Art. 123 Tax Code of the Russian Federation. And charge a fine of 20% of the amount to be transferred.
In addition, you will also have to pay penalties for late payment of personal income tax (Article 75 of the Tax Code of the Russian Federation). Let us remind you that penalties are accrued for each calendar day of delay in fulfilling the obligation to pay tax and are determined as a percentage of the unpaid tax amount. The interest rate of the penalty is assumed to be equal to 1/300 of the Bank of Russia refinancing rate in force at that time. That is, despite the “overpayment”, upon subsequent payments of income to individuals, the tax must be withheld and transferred to the budget in full.
As for the erroneously transferred personal income tax amount, it can be returned. To do this, submit a refund application to the tax office. Moreover, you have three years from the moment the overpayment was discovered. Such rules are established in paragraph 7 of Art. 78 of the Tax Code of the Russian Federation.
Having received the application, tax authorities must inform you in writing within five working days from the date of the decision of their decision to return the money or refuse the return (clause 9 of Article 78 of the Tax Code of the Russian Federation). The inspectorate makes this decision based on the results of a joint reconciliation of tax calculations (Letter of the Federal Tax Service of Russia dated July 4, 2011 N ED-4-3/10764).
Let us remind you that the inspectorate is obliged to return the overpayment for personal income tax to the tax agent within a month after receiving an application from him (clause 6 of article 78 of the Tax Code of the Russian Federation).
If the inspection violates this deadline, then interest is charged on the amount to be returned for each calendar day of delay. This is stated in paragraph 10 of Art. 78 Tax Code of the Russian Federation.
The tax office will transfer the refunded money to your current account, which you indicate in the refund application.
Memo. The procedure for returning overpayments is prescribed in Art. 78 Tax Code of the Russian Federation. It applies not only to taxpayers, but also to tax agents.
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The procedure for returning personal income tax, which is excessively withheld from the income of an individual and transferred to the budget.
A situation where a tax agent organization excessively withheld personal income tax from an individual’s income and transferred it to the budget may arise, for example, when providing an employee with a property or social deduction not from the beginning of the year. In this case, according to paragraph 1 of Art. 231 of the Tax Code of the Russian Federation, the amount of tax excessively withheld by a tax agent from the taxpayer’s income is subject to refund by the tax agent on the basis of a written application from the taxpayer. In this case, the organization is obliged to inform the taxpayer about each fact of excessive tax withholding and the amount of excessive tax withheld within 10 days from the date of discovery of such a fact.
Note:
The return of the tax amount to the taxpayer in the absence of a tax agent (for example, in the event of liquidation of an organization) or in connection with recalculation at the end of the tax period in accordance with the status of a tax resident of the Russian Federation acquired by him is carried out by the tax authority with which he was registered at the place of residence (place stay), and not an organization - a tax agent (clauses 1 and 1.1 of Article 231 of the Tax Code of the Russian Federation). The refund to the employee-taxpayer of the excessively withheld amount of tax is made by the tax agent organization at the expense of the amounts of this tax subject to transfer to the budget system of the Russian Federation on account of upcoming payments both for the specified taxpayer and for other taxpayers from whose income the tax agent withholds tax, within three months from the date the tax agent receives the relevant application from the taxpayer. Such a refund can only be made by transferring funds to the taxpayer’s bank account specified in his application (Article 231 of the Tax Code of the Russian Federation, letter of the Federal Tax Service of the Russian Federation dated July 18, 2016 No. BS-4-11 / [email protected] , Ministry of Finance of the Russian Federation dated May 16. 2011 No. 03 04 06/6-112 (clause 2)). Here are examples of the return of excessively withheld personal income tax and transferred to the budget.
If the amount of upcoming personal income tax payments is greater than the amount that must be returned to the employee.
Example 1 . On 02/20/2017, the employee submitted an application for the return of the excessively withheld personal income tax amount in the amount of 23,000 rubles. The amount of tax to be transferred to the budget on all income paid by the organization to individuals was: – as of March 10, 2017 – 18,000 rubles; – as of April 10, 2017 – 18,000 rubles.
How to offset personal income tax in this case? As already mentioned, you first need to transfer the amount of over-withheld personal income tax to the employee’s account specified in the refund application. Then, by the amount of the returned tax, you need to reduce the amount of current personal income tax payments, calculated from payments to all individuals who received income from the organization, until the returned amount is fully credited. The entire amount of tax excessively withheld from the employee’s income in the amount of 23,000 rubles. transferred to his card on the day of salary payment - 03/10/2017. Part of the refunded tax in the amount of RUB 18,000. the organization will count towards the reduction of personal income tax due on March 10, 2017. Thus, the organization will not transfer personal income tax to the budget on March 10, 2017.
For the remainder of the personal income tax returned to the employee in the amount of 5,000 rubles. (24,000 - 18,000) the organization will reduce the personal income tax due to be transferred on 04/10/2017. As a result, the organization will pay a tax in the amount of 13,000 rubles to the budget. (18,000 - 5,000).
Example 2. On February 20, 2017, an employee submitted an application for the return of the excessively withheld amount of personal income tax in the amount of 63,000 rubles. The amount of tax to be transferred to the budget on all income paid by the organization to individuals is equal to: – as of March 10, 2017 – 18,000 rubles; – as of April 10, 2017 – 18,000 rubles; – as of May 10, 2017 – 18,000 rubles. How to offset personal income tax in this case?
From the conditions of the example it follows that the amount to be returned to the personal income tax officer is greater than the upcoming payments for this tax, since the excessively withheld personal income tax must be returned within three months from the date the tax agent receives the corresponding application from the taxpayer. In this case, the organization must contact its tax office for a refund of excess personal income tax. To do this, within 10 working days from the date of receipt from the employee of an application for the return of excess personal income tax, the organization must be submitted to the tax office (clause 1 of Article 231 of the Tax Code of the Russian Federation, Letter of the Federal Tax Service of the Russian Federation dated September 20, 2013 No. BS-4-11/17025): 1) an application for the return of excess tax withheld; 2) an extract from the tax register for personal income tax for the period when the tax was excessively withheld; 3) certificate 2-NDFL for this person for the period when the tax was excessively withheld. If an organization applies for a refund of personal income tax that was excessively withheld in previous years, it is necessary to submit two certificates: an initial one and a corrected one; 4) documents confirming the excessive transfer of tax (for example, payment order, extract). Within a month from the date of submission of these documents, the controlling authority must return the overpayment of personal income tax to the organization’s current account (Clause 6, Article 78 of the Tax Code of the Russian Federation).
Offset against future personal income tax payments?
The Tax Code has established a ban on paying personal income tax at the expense of a tax agent (clause 9 of Article 226 of the Tax Code of the Russian Federation). The tax must be preliminarily (before payment) withheld from income. This can only be done on the day when the organization issued money from the cash register or transferred it to employees’ bank accounts.
According to tax authorities, it is possible to offset the overpayment of personal income tax against future income tax payments only on the condition that the tax was not paid from the tax agent’s own funds (letter of the Federal Tax Service of Russia dated February 6, 2021 No. GD-4-8/2085). But the Supreme Court thinks differently. In Determination No. 305-KG17-15396 of December 21, 2021, the Supreme Court of the Russian Federation ruled that such early transfer of income tax at the expense of the agent’s funds is not a violation and its further offset against future personal income tax payments is possible.
But be careful when counting personal income tax overpayments against future payments. The Federal Tax Service may not consider such a credit a tax.
If the tax agent did not transfer the over-withheld personal income tax to the employee on time.
So, if the refund of the overly withheld tax amount is carried out by the tax agent in violation of the deadline established by Art. 231 of the Tax Code of the Russian Federation (within three months from the date the tax agent receives the corresponding application from the taxpayer), the tax agent for the amount of over-withheld tax that is not returned to the taxpayer within the prescribed period is obliged to accrue interest, which is also payable to the taxpayer, for each calendar day of violation of the deadline return.
Please note: The interest rate is assumed to be equal to the refinancing rate of the Central Bank of the Russian Federation, which was in effect on the days the repayment deadline was violated.
The procedure for returning personal income tax overpayments that arose for other reasons.
According to paragraphs 1 and 2 of Art. 78 of the Tax Code of the Russian Federation, the offset of amounts of overpaid federal taxes and fees, regional and local taxes is carried out according to the corresponding types of taxes and fees, as well as accrued penalties. The offset or refund of the amount of overpaid tax is carried out by the tax authority at the place of registration of the taxpayer. Clause 5 of Art. 78 of the Tax Code of the Russian Federation provides that the offset of the amount of overpaid personal income tax to repay arrears on other taxes, arrears of penalties and (or) fines subject to payment or collection in cases provided for by the Tax Code of the Russian Federation is carried out by the tax authorities independently. By virtue of paragraph 14 of Art. 78 of the Tax Code of the Russian Federation, the rules established by this article apply to tax agents, payers of fees and the responsible participant in a consolidated group of taxpayers. Tax department employees, as already mentioned, believe that transferring to the budget an amount exceeding the amount of personal income tax actually withheld from the income of individuals does not constitute payment of tax. They consider this amount as funds mistakenly transferred to the budget. In this regard, controllers can return the tax to the tax agent in the manner established by Art. 78 of the Tax Code of the Russian Federation, provided that such a tax agent should not have debts on other federal taxes. In this case, the tax agent has the right to contact the tax authority with an application for the return to the current account of an amount that is not personal income tax and was mistakenly transferred to the budget system of the Russian Federation. Please note that the fact of erroneous transfer of amounts using personal income tax payment details, as well as the fact of excessive withholding and transfer of tax, is confirmed on the basis of an extract from the tax accounting register for the corresponding tax period and payment documents in accordance with paragraph. 8 clause 1 art. 231 Tax Code of the Russian Federation.
Overpayment of personal income tax due to a mechanical error
Good afternoon An expert from the Reference and Legal Service Normativ https://normativ.kontur.ru/ answers you The fact is that personal income tax is a special tax. It is paid only from the income of taxpayers - individuals. An organization acting as a tax agent does not have the right to pay this tax at its own expense. Therefore, in the event of an overpayment for personal income tax, offset of the tax amount against future payments also for personal income tax is not allowed - these amounts cannot be considered amounts of tax withheld from specific individuals. The Ministry of Finance of Russia also indicates that the overpaid amount cannot be offset against future personal income tax payments in its Letters dated September 16, 2014 No. 03-04-06/46268, dated November 12, 2014 No. 03-04-06/57158).
In other words, personal income tax is not a tax that can be paid “in advance” a year in advance. It is transferred to the budget every time income is paid to an individual.
An overpayment of personal income tax to the budget may arise for the following reasons: - the tax agent excessively withheld and transferred personal income tax to the budget from the amounts of income paid to an individual. When an error in the calculation of personal income tax is identified and the taxpayer’s income is adjusted, the excessively withheld and transferred amount of personal income tax must be returned to the individual. And since the tax agent has already transferred this amount to the budget, then, accordingly, the organization must apply to the tax authority for a refund of the overpaid personal income tax amounts.
— the organization mistakenly transferred more personal income tax than it withheld from employees’ income. That is, everything in accounting was calculated correctly, but for some reason, when transferring the tax to the budget, an error was made in the amount of tax.
Based on the terms of your question, it follows that the amount of personal income tax was withheld correctly, that is, the resulting overpayment is not excessively withheld.
In such a situation, this amount is erroneously transferred and, according to the explanations of the regulatory authorities, must be returned to the organization upon its application as erroneously transferred (Letters of the Ministry of Finance of Russia dated 04/29/2014 No. 03-04-05/20252, Federal Tax Service of Russia dated 07/04/2011 No. ED-4 -3/10764, dated 10/19/2011 No. ED-3-3/ [email protected] ).
The procedure for returning such amounts is regulated by Art. 78 of the Tax Code of the Russian Federation, since nothing else is established in the Tax Code of the Russian Federation and tax agents also have the right to timely offset or refund of amounts of overpaid tax and the rules specified in Art. 78 of the Tax Code of the Russian Federation, also apply to tax agents (clause 1 of article 21 of the Tax Code of the Russian Federation, clause 2 of article 24 of the Tax Code of the Russian Federation, clause 14 of article 78 of the Tax Code of the Russian Federation).
Thus, the amount of overpayment for personal income tax can be offset against the arrears of income tax, since these are taxes of the same level - federal. But in order to prove that the overpayment of personal income tax is not tax amounts withheld from the income of taxpayers - individuals, but is your money, as erroneously transferred, you need to carry out a reconciliation report with the tax office and provide supporting documents. For example, certificates in form 2-NDFL, a register of information on the income of individuals, payment documents confirming the fact of excessively transferred tax (Letter of the Ministry of Finance of Russia dated 04/03/2009 N 03-04-06-01/76).
After the tax authority confirms the presence of an overpayment for personal income tax, you can write an application to offset this overpayment against the arrears of income tax.
Sincerely, Pyatovol Svetlana
