Article 422. Amounts not subject to insurance contributions

Payments to volunteers: what amounts are not subject to contributions under Art. 420 Tax Code of the Russian Federation

Cases when the object subject to insurance premiums does not appear are described in Part 2 of Art. 420 of the Tax Code of the Russian Federation (paragraphs 4–7). The following payments are not subject to insurance premiums:

• produced by firms and individual entrepreneurs for the benefit of foreigners and stateless persons working in separate divisions of Russian companies located abroad;
• volunteers as part of the execution of contracts concluded in accordance with Art. 7.1 of the Law of August 11, 1995 No. 135-FZ on charitable activities;
• produced by the organizing committee "Russia-2018" and FIFA (as well as their subsidiaries) in favor of foreign citizens, stateless persons and volunteers (in situations listed in paragraph 7 of Article 420 of the Tax Code of the Russian Federation).

Some benefits may soon be reduced if the State Duma approves draft law No. 204728-7 (on the adjustment of Article 420 of the Tax Code of the Russian Federation). It is proposed to reduce the list of non-contributory amounts by excluding from it payments to foreign citizens and stateless persons under employment contracts and civil service agreements concluded:

• with FIFA subsidiaries;
• organizing committee "Russia-2018" or its subsidiaries.

Find out in a timely manner about important and useful news from the materials and messages of our website:

• “Changes in currency legislation since 2017”;
• “A new fiscal data operator has been registered”;
• “The list of preferential regions for individual entrepreneurs on the simplified tax system and PSN has been updated.”

We will consider further what other payments are not subject to insurance premiums.

Amounts not subject to insurance premiums

Amounts not subject to insurance contributions can be divided into two groups: those excluded from the taxable base and those not subject to insurance contributions.

Income excluded from the tax base

As an example of income excluded from the tax base, one can consider remuneration under a civil partnership agreement, in which the subject is the transfer of ownership and other property rights, and, in addition, the transfer of property for use. Such agreements include lease, loan or borrowing agreements, as well as purchase and sale or gift agreements.

In addition, remuneration payments to foreign citizens and stateless persons are not subject to insurance premiums if they work in a separate unit not on the territory of the Russian Federation. This is stated in the Letter of the Ministry of Finance of the Russian Federation dated March 3, 2017 No. 03-15-06/12031. This point is connected with the fact that insurance applies only to those foreigners who live (permanently or temporarily) and work in the territory of the Russian Federation.

Income not subject to insurance premiums

The list of specific payments not subject to insurance premiums is established at the legislative level - in Art. 422 of the Tax Code of the Russian Federation and Art. 20.2 of Law No. 125-FZ. We will talk about some of them in more detail, and below is a complete list of such payments.

State benefits

In particular, these include the following types of benefits established at the federal and regional levels:

• due to illness;
• in connection with an accident;
• for pregnancy and childbirth;
• child care;
• when registering in the early stages of pregnancy;
• at the birth of a child, etc.

Let's note an important point! If an employer pays additional sick leave benefits up to average earnings, then this additional payment is not a state benefit. Accordingly, the Social Insurance Fund does not compensate for it, and the policyholder is obliged to charge insurance premiums for it.

Daily allowance

In this case, such payments must be taxed according to the following rule:

• For pension, medical and social insurance, daily allowances are taxed on amounts paid in excess of the legal limit - 700 rubles. for business trips in Russia and 2,500 rubles. for business trips abroad (clause 2 of Article 422 of the Tax Code of the Russian Federation);
• for injury insurance, daily allowances are not taxed in full (Clause 2, Article 20.2 of Law No. 125-FZ).

When traveling abroad, it is necessary to recalculate the entire amount of daily allowance into rubles on the date when the director approves the expense report. This is indicated in the Letter of the Ministry of Finance of the Russian Federation dated May 29, 2017 No. 03-15-06/32796.

Severance benefit

When an employee is dismissed, in some cases he is paid severance pay, for which insurance premiums are not charged (within 3 average earnings for ordinary regions and within 6 for regions of the Far North and other equivalent regions). This point does not depend on the exact grounds for which the employee was dismissed (Letter of the Ministry of Finance of the Russian Federation dated 03/07/2017 No. 03-04-06/12796).

This point also applies to the dismissal of a manager, his deputy or chief accountant.

Below is a table of payments that are not subject to insurance premiums. It can also be downloaded from this link.

Non-taxable payments under Article 422 of the Tax Code of the Russian Federation

Amounts not subject to insurance premiums are listed not only in Art. 420 of the Tax Code of the Russian Federation, but also in Art. 422. These are payments:

• not within the framework of labor relations and civil process agreements (for example, financial assistance to relatives of a deceased employee, etc.);
• citizens under contracts related to the sale or transfer of property for temporary use (under lease agreements, transfer of money in debt, etc.);
• in the form of compensation provided for by federal and local legislation (for payment for special clothing, training, etc.)
• other specified in Art. 422 of the Tax Code of the Russian Federation.

Certain types of payments are not subject to insurance premiums if certain requirements are met and only for limited periods of time - we will discuss this in the following sections.

Find out what to do with contributions if an employee dies here.

See also: “ERSV: how to show payments that are not included in the contribution object or not subject to them” and “ERSV line by line: reflecting payments that are not subject to contributions.”

Some features regarding the taxation of insurance premiums

In some situations, companies and regulatory authorities may have different interpretations of the law regarding the imposition of insurance premiums on specific payments.

Payments under a collective agreement that are not related to direct wages

These may include payments that do not depend on the qualifications of employees and the conditions of production activities, and are not an incentive to improve labor efficiency. Some accountants believe that they do not need to be subject to insurance premiums, but employees of regulatory authorities are of the opposite opinion, even if information about them is not contained in the employment contract with the employee.

Payment of financial assistance

The following are not subject to insurance premiums:

• payment of financial assistance in any case up to 4 thousand rubles. (in year);
• at the birth of a child up to 50 thousand rubles. (for each);
• in connection with an emergency or natural disaster (compensation for material damage or harm to health);
• as a result of a terrorist act on the territory of the Russian Federation;
• upon the death of a family member.

You need to be extremely careful, since some types of financial assistance must be subject to insurance premiums, even if they were paid within the framework of an employment relationship.

Example 1

Employee Petrov I.P. financial assistance was paid within the framework of the collective agreement in the amount of:

• 30 thousand rubles. at the birth of a child;
• 10 thousand rubles. in connection with the anniversary.

Insurance premiums must not be calculated on the entire amount, since there are restrictions: for the birth of a child - 50 thousand rubles, for an anniversary - 4 thousand rubles. Accordingly, from the amount of 30 thousand rubles. There is no need to calculate insurance premiums, since it falls within the limit, and for financial assistance for an anniversary, you need to calculate insurance premiums from 6 thousand rubles:

6,000 * 22% = 1,320 rub. (for pension insurance);

6,000 * 5.1% = 306 rub. (for health insurance);

6,000 * 2.9% = 174 rubles. (for social insurance);

6,000 * 0.2% = 12 rubles. (for “injuries” at the lowest level of occupational risk).

Lump sum payment upon retirement

Such payment, according to the regulatory authorities, must be subject to insurance premiums, even if it is included in the Collective Agreement.

Financial assistance in paying for the cost of treatment and medicines

This assistance does not relate to payment for professional activities and does not depend on working conditions and qualifications of employees. In such a situation, the payment must be subject to insurance premiums, even if it is regulated by the Collective Agreement.

Payments for donation and conscription for military training

Insurance premiums must be calculated on payments based on the average earnings of donor employees, on amounts during preparation and completion of military training, as well as during pre-conscription training. This position of the regulatory authorities is indicated in the following regulations:

• Letter of the FSS dated November 17, 2011 No. 14-03-11/08-13985;
• Letter of the Ministry of Health and Social Development of the Russian Federation dated March 15, 2011 No. 784-19;
• Letter of the Ministry of Labor of the Russian Federation dated February 17, 2014 No. 17-4/B-54;
• Resolution of the Presidium of the Supreme Arbitration Court of the Russian Federation dated September 13, 2011 No. 4922/11.

Travel expenses

When on a business trip, employees sometimes use paid services at bus stations, airports and railway stations, and these costs can be reimbursed by the employer. Whether these payments are subject to insurance premiums depends on whether they are mandatory or additional expenses and what type of expenses they relate to.

Travel costs (ticket costs, mandatory fees and charges) are included in the group of mandatory expenses necessary for the normal performance of work duties, and therefore they are not subject to insurance premiums.

Additional travel costs associated with an increased level of comfort are not considered mandatory expenses necessary for the implementation of the company’s business process. Accordingly, insurance premiums must be charged on such compensation payments, regardless of whether they are reflected in the company’s local regulatory documentation or not.

It should be noted that for some categories of civil servants, paid expenses for an increased level of comfort are not subject to insurance contributions. Information about this point is contained in Decree of the President of the Russian Federation dated July 18, 2005 No. 813.

In some cases, courts do not agree with regulatory authorities that additional costs for the services of VIP rooms should be subject to insurance premiums. The judges believe that if such expenses are documented, are economically justified, are directly related to the activities of the organization and relate to travel expenses in accordance with local documentation, then they do not need to be subject to insurance premiums. This point is indicated in the Resolutions of the FAS of the Volga District dated January 27, 2014 in case No. A65-10641/2013 and the FAS of the North-Western District dated November 29, 2013 in case No. A05 960/2013.

Travel expenses for renting accommodation (without supporting documents) , according to regulatory authorities, should be subject to insurance contributions. However, the company can fix in local regulatory documentation the amount of compensation payment for the rental of residential premises in the absence of supporting documents. In this case, the courts believe that such payments do not need to be subject to insurance premiums (Resolution of the Federal Antimonopoly Service of the North-Western District of December 6, 2013 No. A26-10709/2012).

Let us remind you that if you have supporting documents for renting residential premises, such compensation payments do not need to be subject to insurance premiums.

Payments for business trips for one day do not need to be subject to insurance premiums if they have documentary evidence. In addition, for one-day business trips there is no provision for payment of daily allowances, but if the company provides them, it must charge insurance premiums.

Payments compensating for moral damage in connection with an accident

Such payments are not subject to insurance premiums if the fact of harm to the employee’s health due to an unlawful action or inaction of the employer is established and confirmed during the investigation of the accident.

As for the amount of moral damage due to an accident, it is established by the court regardless of the amount of material damage subject to compensation. In this case, the degree of guilt of the employer and other particularly important points and circumstances are taken into account. In addition, the degree of physical and moral suffering of the individual who was harmed is taken into account.

Scholarship upon conclusion of a student agreement

Sometimes an employer enters into an apprenticeship agreement with an employee to obtain education with or without time away from work. In this case, the company pays a stipend, the amount of which is determined in the student agreement.

Such a payment does not relate to the employee’s work activity, and therefore should not be subject to insurance contributions, as stated in Letter of the Ministry of Finance of the Russian Federation dated July 3, 2017 No. 03-15-06/41745.

Payment for travel packages and gifts for employees

The calculation of insurance premiums depends on what type of voucher or gift is paid by the employer:

• a travel voucher for an employee is subject to insurance contributions, since this payment is not indicated in the list of exempt payments;
• a trip to members of his family is not subject to insurance premiums, since these citizens do not have an employment relationship with the company;
• a voucher as a gift is not subject to insurance premiums if a gift agreement is concluded. This point is due to the fact that the gift agreement refers to contracts with the transfer of ownership or other real rights to property, payments for which are not subject to insurance premiums;
• a gift to an employee (not related to work activity) is not subject to insurance premiums if a gift agreement is concluded;
• a gift to an employee (related to work activity) is subject to insurance premiums, since it is considered a bonus related to wages;
• a gift to an employee’s children is not subject to insurance premiums if the order or other local act indicates that it is given directly to the child, and not to the employee for the child.

The video material provides information on complex issues of calculating insurance premiums in 2021:

Private lessons and cleaning services: when fees are not paid

Law No. 401-FZ dated November 30, 2016 added clause 3 of Art. 422 of the Tax Code of the Russian Federation, a subparagraph that specifies payments that are not subject to insurance contributions.

This rule applies only to payments received by individuals in 2017–2018 and meeting the following conditions:

• income was received as a result of settlements between individuals (not individual entrepreneurs) for the provision of services for personal needs;
• the recipient of the income notified the tax authorities (the notification scheme is described in clause 7.3 of Article 83 of the Tax Code of the Russian Federation);
• the individual completed the work independently (without hiring hired labor).

The list of services for personal needs includes:

• cleaning of residential premises;
• housekeeping;
• tutoring;
• supervision of persons in need of constant outside care (children, elderly people, the sick - according to the conclusion of the medical institution).

This list may be expanded if regional authorities consider it necessary to include additional services of this kind (for personal, household and other needs) and adopt a corresponding law.

How regional legislation can influence the tax burden and the possibility of not using online cash registers is stated in the articles:

• “List of settlements exempt from online cash registers”;
• “List of property taxed at cadastral value”.

Changes

Art. 422 of the Tax Code of the Russian Federation did not change in 2021 due to the pandemic, although some relaxations in terms of payment of insurance premiums are still provided for by the state for some payers. In general, this norm provides a closed list of payments that are not subject to contributions, which, according to the code, is not subject to broad interpretation. However, disputes regularly arise regarding the income included in the item, and the tax office provides clarifications on them.

At the same time, amendments to Art. 422 of the Tax Code of the Russian Federation are not yet planned. Separate changes were provided in connection with the popular vote on amendments to the Constitution (payments to members of election commissions were included in non-taxable payments). These rules apply to legal relations that arose after 03/01/2020. and become invalid as of 01/01/2021.

A new law has not yet been planned, especially since the chapter on insurance premiums was only recently moved to the Tax Code of the Russian Federation.

Tax on the sale of an apartment in 2021 for individuals - what has changed?

How to fulfill the obligation to notify tax authorities in order not to pay contributions

To obtain an exemption from paying insurance premiums, an individual performing services (clause 7.3 of Article 83 of the Tax Code of the Russian Federation):

• fills out the notification in the form specified in Appendix No. 1 to the order of the Federal Tax Service of Russia dated March 31, 2017 No. ММВ-7-14/ [email protected] ;

• transfers it to the tax authorities before the start of the specified types of services and after the termination of such activities.

The notification is submitted to any tax office - the tax authorities will register the individual at his place of residence (place of stay in the Russian Federation).

Appendix No. 3 to Order No. MMV-7-14/ [email protected] describes the procedure for filling out the notification. With its help, an individual informs tax authorities:

• information about yourself (full name, tax identification number, telephone number, gender, details of an identity document, etc.);
• coded sign of the beginning (“1”) or end (“2”) of the activity;
• type of activity from the proposed options.

If an individual provides other services, the type of which is prescribed by regional authorities, the last sheet of the notification is additionally filled out, which reflects:

• details of the law and code of the region that installed the service;
• Name of service.

The following materials will tell you about the powers of regional authorities in tax rulemaking:

• “What is the procedure for calculating corporate property tax?”;
• “Basic profitability under the patent tax system in 2017”.

Saving on fees for an entrepreneur using a simplified approach

A simplified individual entrepreneur who pays mandatory pension contributions for himself determines his expenses for paying contributions according to the algorithm (subclause 1, clause 1, article 430 of the Tax Code of the Russian Federation):

if D ≤ 300,000 rub. → ∑SV = 12 × minimum wage × TSV.

if D > 300,000 rub. → ∑SV = 12 × minimum wage × TSV + 1% × (D – 300,000 rub.),

Where:

D - income for the billing period;

∑СВ — the amount of insurance contributions for compulsory pension insurance;

Minimum wage - the minimum wage established by federal law at the beginning of the year for which insurance premiums are paid;

TSV - the tariff of insurance premiums established by clause 2 of Art. 425 Tax Code of the Russian Federation.

After calculating the amount of insurance premiums in a situation where the income exceeds the border of 300,000 rubles, it is necessary to check whether the conditions are met:

If ∑SV > 8 × 12 × minimum wage × TSV → ∑SV = 8 × 12 × minimum wage × TSV

Thus, the amount of insurance premiums cannot exceed the product of 8 times the minimum wage (increased by 12 times) and the insurance premium rate.

Wherein:

• The income of an individual entrepreneur is determined according to the rules of Art. 346.15 Tax Code of the Russian Federation;
• expenses under Art. 346.16 of the Tax Code of the Russian Federation are not taken into account.

For the nuances of calculating simplified income, see the article “The procedure for calculating tax under the simplified tax system “income” in 2016–2017 (6%) .

This calculation algorithm is described in the letter of the Ministry of Finance of Russia dated 06/09/2017 No. 03-15-05/36277.

What payments are not subject to insurance premiums by law in 2019?

An important task of the accountant of each enterprise, especially in the situation of transition from 2021 to tax administration of insurance premiums, is to clearly define the tax base from which mandatory payments are deducted to the state budget.

There are rules defined by law according to which these contributions are calculated and paid to insurance and extra-budgetary funds. In the standard case, if the taxpayer does not have any benefits, he must transfer 2.9 percent to the Social Insurance Fund, 5.1 percent to the Mandatory Medical Insurance Fund, and 22 percent to the Pension Fund.

At the same time, Article 422 of the Tax Code also establishes which payments are not subject to insurance premiums in 2021. This list is important to consider when determining the tax base.

Article 422. Amounts not subject to insurance contributions

General standards

In accordance with Article 420 of the Tax Code, for companies, entrepreneurs and individuals who do not have the status of individual entrepreneurs, the object of calculation of insurance premiums is the payments they make in favor of employees, provided for by the labor relations established between them and the terms of civil law agreements.

For taxpayers who do not pay any remuneration to other individuals, a fixed base for payment of contributions is provided, associated with the minimum wage.

Article 420. Object of taxation of insurance premiums

If certain payments are made in favor of employees that are not directly provided for by the terms of the contract, deductions of insurance contributions from them must still be made, since they take place within the framework of existing labor relations.

What reports need to be submitted?

Changes in legislation have made it necessary for payers of contributions to submit reports not only to various funds, but also to the tax office. For this purpose, a single calculation was introduced, providing for quarterly payment, which replaced several previously used forms.

Submission of a single calculation to the Federal Tax Service must be carried out within the first thirty days of the month following the reporting period. If an organization has more than 25 employees, the calculation must be submitted in electronic format; for everyone else, a standard paper submission is sufficient.

Despite the elimination of forms RSV-1 and 2, 4-FSS and RV-3, the obligation to report to funds still remains.

At the same time, a number of innovations are being introduced from 2021:

• The deadline for submitting the CMEA-M form is increased by five days, and now the first fifteen days after the end of the previous reporting month are allotted for its submission.
• A new report is being introduced that requires information about length of service and must be submitted no later than the beginning of March following the reporting year.
• Reporting to the Social Insurance Fund is maintained only for contributions paid in the event of injuries and occupational illnesses of employees. These reports are submitted in the first twenty or twenty-five days of the reporting month, depending on the method of submission (in paper or electronic format).

Nuances on objects and income

Insurance premiums are not calculated in the absence of a taxable object. The domestic Tax Code provides for direct cases where there is no need to charge contributions.

In particular, contributions are not accrued on income received by an individual in the form of payment in accordance with GPC agreements, the subject of which is the transfer of property rights or directly property for use. However, this category should not include those contracts that are subject to taxation, for example, those providing for an author's order, the acquisition of a license, and others.

As for regular salaries, insurance premiums are not paid on them only if they are received by citizens of foreign countries or persons without citizenship at all, if they have concluded labor agreements with them, and they work in separate departments of Russian companies abroad. This also applies to cases of concluding contracts for the implementation of work or certain services outside the Russian Federation.

There is no object for taxation of insurance premiums in a situation where compensation is provided for expenses incurred by volunteers if civil contracts have been concluded with them in accordance with the law on charitable activities.

Verification and refund of contributions

Conducting desk and field audits relating to the calculation and payment of contributions, with the exception of those related to injuries, has become the responsibility of the tax service since 2021. The rules for such audits are similar to those used for audits in the tax field.

The Social Insurance Fund will continue to check the costs incurred by the enterprise in connection with mandatory social insurance.

Only personalized reporting in the CMEA-M form remains under the control of the Pension Fund, as well as data relating to length of service that requires annual submission. Policyholders retain the right to receive refunds on overpaid premiums, but responsibility for this now falls on the tax authorities, and not on the funds.

The refund procedure will generally coincide with that which takes place for tax refunds, while a new condition is introduced, enshrined in Article 78 of the Tax Code: the refund of overpaid pension contributions will be impossible if they are reflected in personalized reporting and posted by the Pension Fund to personal accounts .

Refunds of excess amounts paid for injury contributions will be carried out by the Social Insurance Fund. The procedure is the same as that used for other contributions.

Special cases

Travel compensation and other details

Reimbursable travel expenses include:

• funds for the purchase of tickets and fuel;
• housing rent;
• other expenses of the employee, permission for which is received from the employer.

The law also establishes which payments are not subject to insurance premiums in 2021 in connection with business trips:

• travel costs to and from your destination;
• commissions provided by airports for using their services;
• rent for a room or other housing during a business trip;
• costs associated with obtaining a passport or visa.

Contributions are calculated on the salary paid during a business trip, since it is not directly related to travel expenses.

All payments related to the employee’s performance of his direct labor duties are not subject to insurance premiums. Exceptions to this rule include allowances for work in especially difficult conditions, as well as payments in foreign currency, similar to daily allowances, due to employees of ships and aircraft operating international flights.

What payments should not be subject to insurance premiums in 2019

The base for calculating insurance premiums is calculated by subtracting from the total amount of payments related to the object of taxation those payments that are not subject to contributions.

Payments defined by law as non-taxable with insurance premiums, and also not subject to taxation, are contained in the table:

Attention!

• Due to frequent changes in legislation, information sometimes becomes outdated faster than we can update it on the website.
• All cases are very individual and depend on many factors. Basic information does not guarantee a solution to your specific problems.

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Source: https://buhuchetpro.ru/kakie-vyplaty-ne-oblagajutsja-strahovymi-vznosami/

Results

The Tax Code provides for the payment of insurance premiums on a significant portion of the income received by citizens.
The payments listed in Art. 410 and 422 of the Tax Code of the Russian Federation. These are amounts not related to the performance of labor duties, compensation provided for by law, payment for services performed by individuals for the personal needs of citizens, etc. You can find more complete information on the topic in ConsultantPlus. Free trial access to the system for 2 days.

Non-taxable amounts are reflected in the report on insurance premiums

Types of payments for which insurance premiums are not charged are provided with separate items in the report. For this purpose, the declaration provides the corresponding appendices No. 1, 2 and subsections 1.1 and 1.2.

Inspection authorities require their reflection on the corresponding lines 030 and 040 (in some cases). Some organizations are of the opinion that since contributions are not charged, there is no need to mention it. This position is not always correct.

The Tax Service requires the generation of reporting on insurance premiums in accordance with the requirements of Art. 422 of the Tax Code of the Russian Federation and disclose accruals in full.