Income not taken into account for calculating income tax

Income tax payers

The following must pay income tax:

Russian organizations;

foreign organizations that operate in Russia through permanent representative offices and (or) receive income from sources in Russia;

foreign organizations that are recognized as tax residents of Russia are treated as equal to Russian organizations. The conditions under which a foreign organization is recognized as a tax resident are defined in Article 246.2 of the Tax Code of the Russian Federation.

This is stated in paragraphs 1 and 5 of Article 246 of the Tax Code of the Russian Federation.

What income is subject to income tax

The following income is subject to income tax:

income from the sale of goods (works, services) and property rights;

non-operating income.

This classification of income is provided for in paragraph 1 of Article 248 of the Tax Code of the Russian Federation.

Situation: should a Russian organization pay income tax on income received under an outstaffing agreement, under which it provides personnel to a Kazakh organization? The agreement was concluded on behalf of the head office, but payment may also be received by the branch in the Republic of Kazakhstan.

Yes, I should. And independently on the territory of Russia. And that's why.

Services for the provision of personnel are provided directly by the head office of the organization - it is with them that the contract is concluded. And the branch only participates (may participate) in the calculations. Therefore, the head office of the organization is obliged to include revenue from the sale of services in the calculation of the general tax base and independently transfer the profit tax on such income to the Russian budget.

This must be done, despite the fact that the source of payment of income, that is, the Kazakh organization - the customer of the services, is located outside of Russia. Although a Russian organization receives profit from business activities in the Republic of Kazakhstan, it does not have to pay tax on it in the territory of this state. After all, this is required to be done only when at least one of the conditions is met:

the profit is received by a branch of a Russian organization registered in the Republic of Kazakhstan;

profit comes from the sale of the same type of product that is sold through such a branch;

the profit is received from business activities, which by their nature coincide with the business activities of the branch.

This procedure follows from the provisions of paragraph 1 of Article 5 and paragraph 1 of Article 7 of the Convention for the Elimination of Double Taxation between Russia and Kazakhstan of October 18, 1996.

However, in the situation under consideration, none of the above conditions are met. This means that income tax must be paid on Russian territory.

Income of foreigners exempt from personal income tax

This issue is regulated by Article 215 of the current tax legislation. It lists all the income of foreign citizens who are exempt from paying the mandatory duty.

Income of foreigners not subject to taxation:

All income of consuls and members of diplomatic missions, as well as members of their families.
Income of technical services employees and diplomatic service personnel.
Income of employees of international enterprises and organizations.

This applies only to citizens of those states with which Russia has signed relevant agreements and agreements. These relaxations do not apply to other foreigners living in Russia. Tax will be withheld from their income on a general basis.

Refunds of taxes, fines, penalties

Situation: when calculating income tax, is it necessary to include in income the amounts of overpaid (collected) taxes, fines, penalties that were returned from the budget?

The answer to this question depends on the type of tax for which the overpayment arose.

Excessively paid (collected) may be:

taxes that are included in expenses on the basis of paragraph 1 of Article 264 of the Tax Code of the Russian Federation (property tax, transport tax, land tax);

taxes that do not reduce taxable profit (VAT, income tax).

In the first case, the tax base for income tax needs to be adjusted (increased). After all, previously an inflated amount of tax was reflected in expenses. The overpayment returned from the budget must be included in non-operating income (Article 250 of the Tax Code of the Russian Federation). In this case, you do not need to submit an updated income tax return. Make the adjustment in the reporting period in which the overpayment was received by the organization.

Similar clarifications are contained in the letter of the Ministry of Finance of Russia dated January 23, 2014 No. 03-03-10/2274 (brought to the attention of the tax inspectorates by letter of the Federal Tax Service of Russia dated February 12, 2014 No. GD-4-3/2216). The legality of this approach is confirmed by Resolution of the Presidium of the Supreme Arbitration Court of the Russian Federation dated January 17, 2012 No. 10077/11.

In the second case, there is no need to adjust taxable profit by the amount of the returned overpayment. These amounts were not reflected in expenses, which means that their return will not affect the amount of income tax. The same applies to penalties and fines (clause 2 of Article 270 of the Tax Code of the Russian Federation).

Similar clarifications are contained in the letter of the Ministry of Finance of Russia dated August 31, 2012 No. 03-03-06/1/453.

In addition, taxable profit is not increased by interest accrued by the tax inspectorate for late return of overpaid (collected) taxes, penalties, and fines (subclause 12, clause 1, article 251 of the Tax Code of the Russian Federation).

Adjustment of the list of non-taxable income

Legislators adjust the list of non-taxable income from time to time. Let's talk about two such innovations and the clarifications that appeared in connection with this from the Federal Tax Service and the Ministry of Finance.

Subclause 11.1 clause 1 art. 251 Tax Code of the Russian Federation

With the advent of this subclause, money returned to the shareholder that he previously contributed to the organization’s property is not subject to income tax. This refers to funds received by an organization free of charge (within the limits of its initial contribution) from a business company or partnership of which such an organization is a shareholder (participant).

In this case, two conditions must be met simultaneously:

the refund is made within the amount of the previously made cash contribution to the property;
the taxpayer has documentary evidence of the size of the contribution made by the shareholder and the amount of funds returned to him free of charge.

In these circumstances, a transaction occurs that is the opposite of receiving money as a contribution to the organization’s property, the income from which under sub. 3.7 clause 1 art. 251 of the Tax Code of the Russian Federation is not taken into account when calculating income tax (letter of the Ministry of Finance of Russia dated February 14, 2019 No. 030-03-06/1/9345).

Subclause 11.2 clause 1 art. 251 Tax Code of the Russian Federation

Based on this subparagraph, it is legal not to impose income tax on income in the form of the results of work on the reconstruction and (or) transfer of fixed assets carried out by third-party organizations if:

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these works were carried out in connection with the creation of another capital construction facility that is in state or municipal ownership;
These works are financed from the budget.

According to the explanations of the tax authorities, the specified income is included in the group of non-taxable income, regardless of the date of state registration of ownership of capital construction projects being created (letter of the Federal Tax Service of Russia dated March 27, 2019 No. SD-4-3 / [email protected] ).

Officials from the financial department added one clarification: if work is financed by private individuals on another capital construction project, the income is subject to income tax in the generally established manner (letter of the Ministry of Finance of Russia dated March 27, 2019 No. 03-03-06/1/20674). It is recognized on the date of signing by the parties of the property acceptance and transfer act as non-operating income for income tax.

Income from interest-free loans

Situation: when calculating income tax, is it necessary to take into account non-operating income from saving on interest when receiving an interest-free loan?

No no need.

The unpaid interest amount is not recognized as the borrower's income. The amount of the interest-free loan received is also not taken into account when calculating income tax (Article 41 and subparagraph 10, paragraph 1, Article 251 of the Tax Code of the Russian Federation). Therefore, when using an interest-free loan, it is not necessary to increase the tax base by the amount of unpaid interest.

The legitimacy of this approach is confirmed by regulatory agencies (letters of the Ministry of Finance of Russia dated May 11, 2012 No. 03-03-06/1/239, dated April 18, 2012 No. 03-03-10/38, dated April 2, 2010 No. 03 -03-06/1/224) and arbitration practice (see, for example, resolutions of the Presidium of the Supreme Arbitration Court of the Russian Federation dated August 3, 2004 No. 3009/04, FAS Volga District dated November 25, 2009 No. A55-6151/2009, North -Caucasian District dated March 28, 2008 No. F08-870/08-529A).

Is it necessary to determine income if the borrower and lender are related persons? As a general rule, taxation must take into account any income that could be received in comparable transactions between non-related parties (clause 1 of Article 105.3 of the Tax Code of the Russian Federation, letter of the Ministry of Finance of Russia dated February 24, 2012 No. 03-01-11/1-15 ). To determine the amount of this income, you need to compare the conditions for obtaining interest-bearing and interest-free loans. However, for the borrower such a comparison does not make sense: he cannot receive any income from receiving, using and repaying both interest-bearing and interest-free loans. As for the lender who provided a loan to a related party, for tax purposes he has income in the form of unearned interest.

Situation: when calculating income tax, is it necessary to take into account non-operating income in the form of unearned interest on an interest-free loan? The organization provided an interest-free loan to a related party.

Yes, it is necessary if the transaction is recognized as controlled.

Issuing an interest-free loan to a related party may be a controlled transaction. For example, if in 2015 an organization issues an interest-free loan to a subsidiary on a simplified basis and the total annual income from transactions between them exceeds 60 million rubles.

In such a situation, the lender's taxable income must be increased by the amount of unearned interest. This amount should be determined based on the terms on which the loan would be provided to an unrelated party in a comparable transaction. That is, based on the amount of interest that the lender would receive if the loan he provided was interest-bearing. This procedure follows from the provisions of paragraph 6 of Article 250, paragraph 1 of Article 105.3 of the Tax Code of the Russian Federation and is confirmed by letters of the Ministry of Finance of Russia dated October 5, 2012 No. 03-0118/7-137, dated July 18, 2012 No. 03-01-18/ 5-97, dated February 24, 2012 No. 03-01-11/1-15.

If the issuance of an interest-free loan is not recognized as a controlled transaction, then the lender does not need to determine the amount of uncollected interest.

What is not recognized as income of a “simplified person”

The income of an enterprise is the economic benefit resulting from the receipt of cash or other assets, as well as capital gains due to the repayment of liabilities. But not all receipts are income.

Income from ordinary activities includes revenue from the sale of inventory items and services; other income from the main activities of the enterprise. Other income includes proceeds from the sale of fixed assets, bank interest for the use of the organization’s funds, income from joint activities, for the use of intellectual property, rent (provided that this is not the main activity). Other income includes assets received free of charge, penalties and fines for non-compliance with contractual obligations, and other income.

For accounting purposes, the breakdown of income is reflected in paragraphs. 5, 7, 8 PBU 9/99. In tax accounting, the division of income differs from the accepted division in accounting.

For “simplified” people, the procedure for determining income is enshrined in Art. 346.15 of the Tax Code of the Russian Federation, which refers to paragraphs. 1 and 2 tbsp. 248 of the Tax Code of the Russian Federation, from these articles it follows that tax accounting provides for:

income from sales reflected in Art. 249 Tax Code of the Russian Federation;
non-operating income listed in Art. 250 Tax Code of the Russian Federation;
income not taken into account under the simplified tax system specified in Art. 251 Tax Code of the Russian Federation.

Income from sales is revenue for goods (work, services), proceeds from the sale of rights to property, expressed in cash and (or) in kind. Income that is not taken into account for taxation is indicated in Art. 251 Tax Code of the Russian Federation.

GOOD TO KNOW
Non-operating income is income not reflected in Art. 249 of the Tax Code of the Russian Federation. These include income from securities, in the form of interest under agreements on bank deposits and loans; from equity participation in other organizations; from the results of intellectual property, from rental payments (if this is not the main activity); in the form of exchange rate differences; assets received free of charge (except for the cases specified in Article 251 of the Tax Code of the Russian Federation); in the form of fines and penalties for violation of the terms of the contract; in the form of surpluses identified during the inventory; other income.

Also, when determining an object according to the simplified tax system, the income of individual entrepreneurs, subject to personal income tax at rates of 9% and 35%, is not taken into account; income in respect of which an organization pays income tax on the simplified tax system for foreign companies, for dividends received, for income from transactions with securities (clauses 1.6, 3 and 4 of Article 284 of the Tax Code of the Russian Federation).

Conditions for revenue recognition

Correct recognition of income is necessary for enterprises that have chosen the object of taxation “income” and for those who apply “income minus expenses”.

In both cases, one main condition for recognizing income is that the simplified tax system uses the cash method. Revenue is recognized as of:

receiving funds;
receiving property (work, services);
repaying debt in another way (Article 346.17 of the Tax Code of the Russian Federation).

When taxing, the following conditions must be met to recognize income:

the principle of continuity - the receipt of funds is taken into account on a continuously accruing basis for the reporting (tax) period (clause 5 of Article 346.18 of the Tax Code of the Russian Federation);
principle of validity of income recognition - income must be documented;
The principle of time certainty is to take into account income by the date of implementation.

It is not enough to understand what income is included in the tax base; you also need to know when income can be recognized and what supporting documents must be provided. Let's consider some nuances:

1. Receipt of funds to the account or cash register for products (work, services) - on the date of receipt. It does not matter whether the shipment was made or whether the work (services) was performed.

2. When paying with bills of exchange - on the date of repayment of the bill. When submitting a bill of exchange to a bank of the Russian Federation - on the date of receipt of money in the current account. If a bill of exchange is settled with a counterparty, a transfer signature is filled out, indicating the transfer of ownership. The day of receipt of income in this case is the day of transfer of the bill of exchange by endorsement to another person (Clause 1 of Article 346.17 of the Tax Code of the Russian Federation).

3. When calculating in foreign currency - on the date of receipt of the currency, income is recalculated into rubles at the official exchange rate of the Central Bank of the Russian Federation (clause 3 of Article 346.18 of the Tax Code of the Russian Federation). Foreign currency earnings are recalculated into rubles on the date of receipt in the transit currency account (letter of the Ministry of Finance of Russia dated January 22, 2015 No. 03-11-06/2/16452/1645).

4. When writing off accounts payable after the expiration of the limitation period - on the end date of the period when the limitation period expired (if the debt does not relate to clause 21, clause 1, article 251 of the Tax Code of the Russian Federation). It is necessary to correctly calculate the statute of limitations; taking into account the discontinuity, the period cannot be more than 10 years from the moment of occurrence (Clause 2 of Article 200 of the Civil Code of the Russian Federation). It is important to remember that failure to write off such debt will not exempt you from liability in the absence of accounting documents - a reconciliation report with the creditor, an inventory report, a certificate of write-off (letter of the Ministry of Finance of the Russian Federation dated January 28, 2013 No. 03-03-06/1/38).

5. Fines for violation of the terms of concluded agreements are recognized not on the date of the additional agreement or court decision, but on the date the penalties are credited to the account or cash desk (letter of the Ministry of Finance dated July 1, 2013 No. 03-11-06/2/24984).

6. When paying in kind (also gratuitous receipt) - on the date of receipt at market prices (clause 4 of Article 346.18 of the Tax Code of the Russian Federation). The cost must be confirmed documented or through an independent examination on the date of receipt of income.

7. When offsetting debts - on the date of signing the act of offset, signed by both parties for the amount of the repaid obligation (letter of the Ministry of Finance dated September 23, 2013 No. 03-11-06/2/39230).

8. Upon receipt of an advance - on the date of receipt of the advance to the account or cash desk of the organization. The advance payment is taken into account in the period in which the money was returned, with a minus sign for the amount of the returned amount. In this case, the return must be confirmed with primary documents: a bank statement, a payment order with the inscription - return of the advance under a specific agreement, a letter or additional agreement on changing the payment (conditions).

9. Upon receipt of a check for payment, the date of receipt of income is the date specified in the act of transfer of the check. When submitting a check to a Russian bank - the date the funds are credited to the account.

POSITION OF THE MINISTRY OF FINANCE
The maximum amount of income at which a company can remain on the simplified tax system in 2021 is 150 million rubles. Moreover, this value will be constant, i.e. it will not be subject to increase by the deflator coefficient until 01/01/2020. Enterprises that plan to switch to the simplified tax system from 01/01/2018 must have income for 9 months of 2021 of no more than 112.5 million rubles.
— Letter dated January 24, 2017 No. 3-11-06/2/3269.

Not named in the list

Controversial issues regarding taxation are most often interpreted taking into account the fact that non-taxable income specified in Art. 251 of the Tax Code of the Russian Federation, this is a closed list of income, therefore, if the income is not named in this article, then the income must be taxed, since the list of income in Art. 250 of the Tax Code of the Russian Federation is open.

But, however, there are such receipts that are not named in Art. 251 of the Tax Code of the Russian Federation, but under the simplified tax system they are not taken into account in income.

Such income includes:

refund of overpaid taxes, fines, penalties, contributions;
receipts from the Social Insurance Fund for disability benefits;
return of funds erroneously transferred to the counterparty;
advances returned;
dividends received, if tax agents withheld taxes from them.

Despite the fact that in Art. 251 of the Tax Code of the Russian Federation indicates non-taxable income; many points require clarification.

The following incomes are not taken into account (let's look at some of them):

in the form of property received under targeted financing (clause 14, clause 1, article 251 of the Tax Code of the Russian Federation);
in the form of property, property rights received in the form of a deposit or pledge (clause 2, clause 1, article 251 of the Tax Code of the Russian Federation);
in the form of property (including cash) received by the commission agent in connection with the fulfillment of obligations under the commission agreement (clause 9, clause 1, article 251 of the Tax Code of the Russian Federation).

“Problematic” targeted financing

Organizations using the simplified tax system do not include targeted financing in their income (clause 1, clause 1.1, article 346.15 of the Tax Code of the Russian Federation) in accordance with the list given in clauses. 14 clause 1 art. 251 of the Tax Code of the Russian Federation, aimed at conducting statutory activities. Expenses paid using targeted funding cannot be taken into account as expenses when calculating the simplified tax system.

The list of targeted funding is closed; the funds are intended mainly for non-profit organizations.

Organizations of any form of ownership can receive grants for activities in the field of culture, medicine, sports, education, scientific research, environmental protection, etc. The use of funds must be reported to the grantor.

For accounting, you can develop special registers and consolidate them in your accounting policies.

GOOD TO KNOW
Targeted financing is funds that require:
• availability of appointment, compliance with the terms of provision; • use strictly for its intended purpose; • keep separate records of income and expenses; • they must not entail any benefit to the recipient.

If the listed conditions are violated, then these funds must be included in income (as of the date of their receipt), and the tax base can be reduced by the amount of expenses for this purpose.

Features for the deposit

The deposit is a sum of money transferred upon concluding an agreement in writing, to secure the execution of the agreement against the payments due under it (clauses 1, 2 of Article 380 of the Civil Code of the Russian Federation).

Conditions and principles of the deposit:

must be in writing, which confirms the existence of obligations. To do this, it is necessary to draw up a separate document, agreement or add a clause to the main contract, indicating the size, purpose of the deposit and responsibility for failure to fulfill the conditions. If the established procedure is not followed, the payment will look like an advance or prepayment, which may affect the taxation procedure;
guarantees fulfillment of the terms of the contract. By providing a deposit, the company confirms its solvency;
issued against upcoming payments under the contract;
the counterparty guilty of non-fulfillment of obligations must compensate for losses with the amount of the deposit offset;
the size is determined by agreement of the parties;
Payment is made only in monetary terms. The transfer of checks and bills of exchange is not a deposit;
The deposit is paid simultaneously with the conclusion of the contract or after.

If a security payment is made without concluding the main contract, this payment will be an advance payment, and it will not be possible to legally recover it in double amount. This often occurs when selling apartments, when a deposit is taken without concluding a real estate purchase and sale agreement. In this case, it is best to provide for a penalty when registering a deposit.

This method of securing obligations is often used when concluding supply contracts, leases, selling real estate, and holding auctions.

GOOD TO KNOW
The received deposit must be returned if the parties terminate the contractual relationship or cannot fulfill their obligations for reasons beyond the control of the parties to the contract.

The deposit amount is not included in the taxable base for the single tax, but some features should be taken into account. For example:

1. When receiving a deposit to secure the conclusion of an agreement, this amount does not increase income under the simplified tax system, provided that it is returned after the expiration of the agreement. If the security payment is not returned, it will be included in income (letter of the Ministry of Finance of Russia dated June 22, 2015 No. 03-11-06/2/36071).

2. The amount of a deposit drawn up in writing is not recognized as a sale of goods and is not included in the tax base. If the deposit is subsequently counted towards payment for the goods, then on the date of offset the security payment will increase the taxable base under the simplified tax system (letter of the Federal Tax Service of Russia dated December 30, 2014 No. GD-4-3 / [email protected] ).

3. The deposit does not bring economic benefit to the counterparty. If it is returned after fulfilling the terms of the contract, it is not income (letter of the Ministry of Finance of Russia dated March 24, 2017 No. 03-03-07/17197). Contents of paragraphs. 2 p. 1 art. 251 of the Tax Code of the Russian Federation is applicable to the simplified tax system and income tax.

GOOD TO KNOW
For organizations using the simplified tax system “income minus expenses”, the list of expenses is determined in accordance with Art. 346.16 of the Tax Code of the Russian Federation, a deposit is not provided for in this list. Therefore, the amount of the deposit cannot increase the expenditure portion under the simplified tax system.

Determining the amount of income

Determine the amount of income in monetary form (clause 3 of Article 274 of the Tax Code of the Russian Federation). When receiving income in kind, determine its size based on the transaction price, taking into account the provisions of Article 105.3 of the Tax Code of the Russian Federation (clauses 4 and 5 of Article 274 of the Tax Code of the Russian Federation). For tax purposes, exclude from the income received the amounts of VAT and excise taxes charged to buyers (customers) (paragraph 2, subparagraph 2, paragraph 1, Article 248, paragraph 19, Article 270, Articles 168 and 198 of the Tax Code of the Russian Federation).

Confirm the amount of income with primary documents, tax accounting documents and other documents indicating the receipt of income (paragraph 3, subparagraph 2, paragraph 1, article 248 of the Tax Code of the Russian Federation).

Accounting for income in foreign currency

Income that is expressed in foreign currency should be taken into account in conjunction with income, the value of which is expressed in rubles. Their amounts must be converted into rubles at the official exchange rate established by the Bank of Russia on the date of recognition of the corresponding income. This is provided for in paragraph 3 of Article 248 of the Tax Code of the Russian Federation. As a result, exchange rate differences (positive, negative) may arise (clause 11 of Article 250, subclause 5 of clause 1 of Article 265 of the Tax Code of the Russian Federation).

In a similar manner, determine income expressed in conventional units (clause 3 of Article 248 of the Tax Code of the Russian Federation). In this case, use the rate established by the Bank of Russia on the date of sale (paragraph 4 of Article 316 of the Tax Code of the Russian Federation).

Income from sales

Sales income on which you need to pay income tax includes sales proceeds:

products (works, services) of own production;

previously purchased goods (including land plots, depreciable property, materials, etc.);

property rights.

This is stated in paragraph 1 of Article 249 of the Tax Code of the Russian Federation.

Organizations that calculate income tax on a cash basis must include advances received against the upcoming supply of goods (work, services) as part of sales revenue. This requirement follows from the provisions of paragraph 2 of Article 249 and subparagraph 1 of paragraph 1 of Article 251 of the Tax Code of the Russian Federation. Organizations that maintain tax accounting using the accrual method do not take into account advances received as income (subclause 1, clause 1, article 251, clause 1, article 271 of the Tax Code of the Russian Federation).

Legal regulation

A closed (i.e. complete) list of income that is not taken into account when determining the corporate income tax base is given in Art. 251 Tax Code of the Russian Federation. From January 1, 2021, amendments introduced by the said Law No. 424-FZ expanded the composition of non-taxable income tax.

Now we’ll look at each of the three categories of new income exceptions for tax accounting of taxable profits.