Salary advance: how to calculate what to include and what amounts to withhold

General payment rules

As already noted, the provided advance on the expected salary should not be subject to personal income tax or any other tax.
The procedure for paying an advance on wages is specified in Article 136 of the current Labor Code of the Russian Federation. In accordance with it, the employer is obliged to accrue the required salary at least 2 times a month. This means that the limit is broken into two parts, each of which is paid in the middle and at the end of the month. But this rule is not mandatory, so the deadlines in a particular organization can be shifted in any direction. The main requirement is that the maximum gap between two transfers does not exceed 15 days. In the standard form, payment must be made before the 15th of each month in the amount of 35-45%, and by the 31st of the current month the rest of the salary is paid. It is from the main part of the salary, which is indicated in the personal income tax, and which is provided for in the employment agreement, that the tax is calculated. Therefore, the employee receives remuneration after deduction of tax.

When to pay tax on salary advance 2021?

The second part of Article 223 of the Tax Code of the Russian Federation states that personal income tax should not be calculated from the advance payment to wages itself, because payment is expected from the final amount on the last day of receiving wages. It turns out that the stipulated transfers and deductions must be made to the budget from the final salary amount, and not from the advance payment. The deadline for transferring personal income tax on salary advances depends on when wages are paid in full to the organization.

Should vacation pay be included?

Do I need to include in the advance compensation for vacation or average earnings during a business trip that took place in the first half of the month? There are two opinions on this matter.

The first is that it is necessary to do this. The argument is that if the specified amounts are not included in the advance payment, then the employee will receive less than he is entitled to.

But there is also the opposite opinion. The advance is the salary for the first half of the month, but neither vacation pay nor average earnings for a business trip are part of the salary. Therefore, they should not be taken into account when calculating the advance payment.

Let us illustrate with the example of the mentioned Romashka LLC. Another employee of the organization with a salary of 20,000 rubles worked for 6 days in the first half of the month, and was on a business trip for another four. Based on the average daily earnings, he was credited 3,500 rubles during the business trip. Let's calculate the amount of the advance:

1. Payment for the time actually worked by the employee will be: 20,000 / 21 * 6 = 5,714.29 rubles.
2. Reserve personal income tax withholding from this amount: 5714.29 / 100 * 13 = 742.88 rubles.
3. The accrual for the business trip is not included in the advance amount, since it is not a salary.
4. The employee's advance will be: 5714.29 - 742.88 = 4971.41 rubles.

How is tax withheld and paid in non-standard situations?

In the labor segment, such non-standard situations include, in particular, dismissal in the middle of the current month. This means that the tax should actually be calculated from the advance payment. In this case, a fixed 13% is deducted from the amount issued, after which the rest is given to the staff unit at its disposal. Consequently, there is no mandatory obligation for the employer to withhold the required tax from the full salary. Exceptions may be provided.

Advance on the last day of the month

This form is also allowed, but only if the rest of the salary was issued no earlier than 15 days ago. This has already been noted - organizations can independently set the terms for crediting salaries, but only if the permissible period between transactions is observed. This rule does not apply to employees working on a rotational basis.

Salaries are paid 3 times a month

The main requirement in provision 136 is the step-by-step procedure for the payment of wages. Here the emphasis is on the definition - “at least 2 times a month”, but nothing is said about the maximum values. Therefore, this form may well be used by a conditional organization. In practice, weekly accrual schemes are also used, which is also not considered a violation.

The award is issued along with an advance payment

The organization independently makes its decision on bonuses. Accordingly, such a preference in relation to a staff unit can be implemented at any time, regardless of the time of receipt of the advance or the main part. The premium may well be paid separately from these transactions, and the tax on it will also be calculated separately.

General rules

The algorithm for withholding and transferring personal income tax from wages is given in Chapter 23 of the Tax Code. It contains two concepts: “date of actual receipt of income” and “day of payment of income.” At first glance, it may seem that these are different formulations of the same event. But in reality we are talking about completely different things.

The date of actual receipt of income, in fact, means the day when the final amount of income became known. It is at this moment that the taxable base can be formed and personal income tax can be calculated. In the case of wages, this moment is the last day of the month for which it was accrued (clause 2 of Article 223 of the Tax Code of the Russian Federation).

The income payment day is the date when money for salary or advance payment is debited from the current account or issued from the cash register. Each employer sets its own payment dates. Sometimes the advance is given on the 25th of the current month, and the salary is given on the 10th of the next month, sometimes the advance is given on the 15th, and the salary is on the 1st, etc.

The moment when the employer is obliged to withhold and transfer income tax to the budget depends on the date of payment of income. Thus, it is necessary to withhold personal income tax upon actual payment of money to an employee (clause 4 of Article 226 of the Tax Code of the Russian Federation). You must transfer money to the budget (with the exception of tax on vacation pay and sick leave) no later than the day following the day of payment (clause 6 of Article 226 of the Tax Code of the Russian Federation). From a literal reading of these norms, we can conclude that personal income tax should be withheld and transferred twice a month: from the advance payment and from the salary.

But officials have repeatedly explained: tax withholding and payment need to be made only once—at the final payment of wages for the month worked. This is explained by the fact that before the end of the month the date of actual receipt of income has not yet arrived. Consequently, the employer is not able to form a personal income tax base and calculate the amount of income tax. This will only be possible on the last day of the month. Therefore, there is no need to withhold and pay personal income tax on the advance payment. Such comments are contained, in particular, in the letter of the Federal Tax Service of Russia dated January 15, 2016 No. BS-4-11/320 (see “The Federal Tax Service reminded that personal income tax is not withheld from advances paid to employees”) and in the letter of the Ministry of Finance of Russia dated July 22, 2015 No. 03-04-06/42063 (see “Ministry of Finance: from an advance paid to an employee, personal income tax is withheld when paying the second part of the salary”).

Personal income tax and advances: method of deduction and payment period

When paying income to individuals, the tax agent (in this case the employer) is obliged to withhold personal income tax and transfer it to the budget. The fact of receiving income when calculating earnings should be based on the norms of paragraph 2 of Art. 223 of the Tax Code of the Russian Federation, where the last day of the month is recognized as income in terms of wages. This means that the company withholds personal income tax and pays it only after paying the second part of the earnings , i.e. in the end of the month.

The deadline for transferring the tax depends on the conditions stipulated by the company’s regulations for remuneration, but without violating the rules established by clause 6 of Art. 226 NK. Namely:

• The day of receiving money from the bank to pay wages is no later than the day of receipt;
• The day of settlement (payment) to staff bank cards is no later than the day of settlement;
• Payments for wages in kind - no later than the day when personal income tax was withheld in cash settlements with the employee.

Difficulties may arise if an employee received an advance and went on vacation without saving wages in the second half of the month. Withholding personal income tax from the advance means violating the norms of clause 6 of Art. 226 NK. In such a case, the company can do the following:

• pay the due funds minus tax;
• at the end of the month, reflect the withheld personal income tax on account 68 (sub-account for personal income tax calculations);
• pay into the budget when paying wages to all company employees.

In this case, you will not have to dispute fines with the Federal Tax Service and pay penalties for being late when paying taxes.

Non-standard situations

The advance is paid on the last day of the month

An exception to the above rules is the situation when the advance is issued on the last day of the month, and the salary is issued in the middle of the next month. For example, an advance payment for May is paid on May 31, and a salary for May is paid on June 15. In this case, the date of actual receipt of income and the date of payment of the advance coincide. This means that already when issuing an advance, you can create a personal income tax base, calculate the amount of tax and transfer the money to the budget.

If, under such circumstances, the employer transfers tax when paying wages and not an advance, inspectors have the right to fine him on the basis of Article 123 of the Tax Code of the Russian Federation. This conclusion was made in the ruling of the Supreme Court of the Russian Federation dated May 11, 2016 No. 309-KG16-1804 (see “The court explained when to transfer personal income tax if the advance is paid to employees on the last day of the month”).

Thus, an employer who issues an advance on the last day of the month is obliged to pay personal income tax on the advance no later than the next day. Then, when the second part of the salary is paid, the organization or individual entrepreneur will transfer the remaining tax for the month worked.

Let us add that the described schedule for payment of advance payments and salaries is very inconvenient from a practical point of view. The fact is that HR officers often close the time sheet and transfer it to the accounting department not on the last day of the month, but after one or two days. And before receiving the report card, accountants cannot determine the amount of income, taxable base and tax. To prevent violations, employers need to either change the salary payment schedule or ensure “early” closure and transfer of timesheets.

Salary is paid in three installments

It happens that employers pay wages not two, but three times a month. As a rule, this happens due to the fact that at the time of payment of the second part of the salary, the company or individual entrepreneur does not have enough funds to fully pay the staff. A debt remains, which the employer repays as soon as possible.

The Federal Tax Service commented on this situation in a letter dated March 24, 2016 No. BS-4-11/4999. According to officials, when faced with it, an accountant should act as follows. If the advance is paid before the end of the month, then there is no need to transfer personal income tax when issuing it. But for each payment made after the end of the month, income tax must be paid (see “The Federal Tax Service announced when personal income tax should be transferred if the monthly salary is paid in three installments”).

Let's explain with an example. Let’s say the advance payment for May was issued on May 25, and the salary for May was issued on June 10 and June 15. Then the accountant must first calculate the total amount of personal income tax for May. Then (if paid on June 10) determine what share of the total amount of the “May” personal income tax falls on the amount of the advance and the first part of the salary. The resulting value is the tax that must be withheld on June 10 and transferred to the budget no later than June 11. The remaining share of the total amount of the “May” personal income tax must be withheld on June 15 and transferred to the budget no later than June 16.

A bonus for labor achievements is issued along with an advance payment

Another exception to the general rules, according to officials, is the situation when, along with the advance payment, the employer pays a bonus for production achievements. The Russian Ministry of Finance is convinced that personal income tax on bonuses must be withheld at the time of their actual payment. And even if the bonus is issued before the end of the month, the tax must be withheld and transferred to the budget no later than the next day.

Financial department specialists explain their position as follows. The general algorithm for withholding and transferring personal income tax from advance payments and salaries applies only to income in the form of wages. But the bonus for labor success is not remuneration, but an incentive payment. Therefore, the date of actual receipt of income for a bonus is not the last day of the month, but the day of payment (subclause 1, clause 1, article 223 of the Tax Code of the Russian Federation). As a result, the taxable base must be formed and the tax withheld at the moment when the bonus is issued to the employee. This point of view was expressed by the Russian Ministry of Finance in a letter dated November 12, 2007 No. 03-04-06-01/383 and confirmed in a letter dated March 27, 2015 No. 03-04-07/17028 (see “Ministry of Finance: Personal income tax on bonuses must be withheld the day of its payment").

However, the judges have a different opinion. In arbitration practice, there are examples where an employer managed to defend its right to transfer personal income tax from a bonus when paying a salary, not an advance. The court recognized: a bonus for production achievements is an element of remuneration, since it was received within the framework of labor relations. If so, then the date of actual receipt of income for the bonus is the last day of the month. Before this date, there is no need to accrue and withhold personal income tax (resolution of the North-Western District Court of December 23, 2014 No. A56-74147/201; “The court resolved the dispute about the date of payment of personal income tax on bonuses for production results”). However, if a company or individual entrepreneur seeks to avoid disagreements with inspectors and possible litigation, it is easier to withhold and pay personal income tax when issuing a bonus.

How to calculate the amount of deductions from an advance payment?

According to Article 109 of the RF IC, the withholding of funds in favor of a minor (disabled) child is carried out on the basis of:

• alimony agreement concluded between the parents and certified by a notary;
• a writ of execution issued in the order of a writ (only for a minor) or enforcement proceedings.

These papers contain information about the volume of monetary obligations to be fulfilled. The amount of alimony agreed upon when signing an alimony agreement between the recipient and the alimony obligee should not be less than the amount expected in court proceedings.

In the absence of a written agreement, the parents involve the judicial authorities in the dispute. The procedure for determining the monthly withholding amount corresponds to the following indicators:

• 1 child – 25% of earnings;
• 2 children – 33%;
• 3 children or more – 50%.

The amount of alimony obligations is subject to change based on a court decision due to circumstances relevant to the case. The maximum is 70%. The procedure for calculating alimony in a fixed amount by the court involves the use of the minimum wage indicator in the formula, which is subject to indexation.

The current legislation provides for the payer's liability for non-payment of alimony in the form of a fine. The presence of intent in the unlawful actions of the alimony obligee entails the application of criminal liability measures.

The algorithm of actions when calculating alimony from an advance payment assumes the following conditions:

1. Withholding of funds is assumed by the employer’s internal documentation on the procedure for remuneration.
2. Official employment of the payer.
3. The amount of earnings is documented.

Collection of financial support in favor of a minor requires the accountant to comply with the sequence of stages of the process:

1. Registration of a writ of execution (court order, agreement) for the recovery of funds from earnings. The document belongs to the strict reporting group and is stored in a safe.
2. Sending a notification to the FSSP about receipt of a document (copy or original). The registration data of incoming correspondence and contact means of communication of the enterprise are indicated.
3. Accounting operations – calculation and deduction. The amount is set by the court or alimony agreement. The calculation uses the amount of the payer’s income remaining after deducting personal income tax. Retention occurs every month.
4. Providing alimony to the recipient. Shipping methods:
   • bank transfer;

   mailing;

5. transfer to a plastic card (account details required).

The accountant draws up a payment slip, indicating:

• payer data;
• details of the writ of execution;
• purpose of payment;
• for what period of collection?

The commission fee for transfer services is borne by the debtor. The amount provided for by the executive document is transferred to the recipient by the enterprise's accountant within 3 days from the date of calculation of wages. Neglect of established deadlines is grounds for prosecution.

Example of withholding alimony when receiving an advance

An employee of Stal LLC Malyshev A.A. receives a monthly advance on the 23rd - 50% of the salary, the second half of the salary - on the 6th. Salary – 60 thousand rubles and bonus – 7 thousand. Alimony obligations are assigned in favor of 1 child and amount to 25% of the official income each month.

Calculation procedure:

1. Total earnings: 60,000 + 7000 = 67,000 rubles.
2. Personal income tax: 67,000 * 13% = 8,710 rubles.
3. Amount used in the formula for calculating alimony: 67,000 – 8710 = 58,290 rubles.
4. Amount of alimony withholding: 58,290 * 25% = 14,572.5 rubles.
5. Advance: (60,000/2) - (60,000/2)*13% = 26,100 rub.
6. The second part of the salary: ((60,000/2)+7000) - ((60,000/2)+7000)*13% = 32,190 rubles.

The total amount of the second part of the earnings is enough to fulfill the monthly alimony obligation. No deduction is required from the advance payment.

What to do when the recovery rate is high?

The legislator provides for the possibility of collecting up to 70% of the income of the alimony obligee in the following cases:

1. Debt for alimony obligations. The reason for accumulating debt is of particular importance.
2. Having 3 or more minor dependents, one of whom is recognized as disabled.

If you make all deductions at the end of the month, then the following situation arises:

• the payment amount does not cover the amount of alimony obligations;
• violation of labor law in terms of receiving wages at least 2 times a month.

In order to prevent violations of current legislation, the accountant is obliged to make the necessary calculations in advance. In some cases, withholding from the advance payment is necessary.

If there are several executive documents

The Federal Law “On Enforcement Proceedings” determined the priority of alimony payments and debt repayment for these obligations.

The amount of income used in calculating alimony is the total balance after deducting personal income tax. The sequence and rate of mandatory payment are regulated by the Tax Code of the Russian Federation.

If there are several writs of execution, obligations are fulfilled in the following order:

1. Alimony, payments for damages (material, moral).
2. Penalties.
3. Other.

The material requirements of the next stage are satisfied after the previous one is repaid.

Retention over the years

The employer does not have the right to collect debt for past periods. The FSSP repeatedly explains about the beginning of the procedure for withholding funds from wages from the moment of receipt of the writ of execution (indication of the month).

Otherwise, the employer’s actions will be regarded as an offense.

Personal income tax from advance in 2021: changes

According to the code, salaries must be paid at least every half month (Part 6 of Article 136 of the Labor Code of the Russian Federation):

• Advance payment - wages for the first half of the month - from the 1st to the 15th. The advance payment period is from the 16th to the last day of the month (usually the 30th or 31st, except in leap years).
• The second part of the salary is payment for the second half of the month. The payment period is from the 1st to the 15th of the next month.

The gap between the two parts of the salary should be no more than 15 days. By paying the second part, the employer pays the employee in full for the month worked (letter of the Ministry of Labor dated 09.23.16 No. 14-1/OOG-8532, letter of Rostrud dated 26.09.16 No. TZ/5802-6-1).

See 2021 Payroll Deadlines

Employers - tax agents are required to withhold personal income tax from employee income upon actual payment (clause 4 of article 226 of the Tax Code of the Russian Federation). Since the date of receipt of the salary is considered the last day of the month for which it was accrued, personal income tax is not withheld from the advance payment. The tax is calculated and withheld from the full amount of salary on the last day of the month, and is paid no later than the date following the day the salary is paid. The Federal Tax Service reported this in a letter dated May 26, 2014 No. BS-4-11 / [email protected] ). The letter of the Ministry of Finance dated July 10, 2014 No. 03-04-06/33737 also states that personal income tax is calculated on the last day of the month, and it must be withheld once - when paying income after the end of the month.

Thus, personal income tax does not need to be withheld from the advance if the company issues it before the end of the month.

Note!

However, according to the Federal Tax Service, if a company paid an advance on the 30th of the month, and wages on the 15th of the next month, it is necessary to transfer personal income tax on the advances. According to tax authorities, if an advance is issued on the last day of the month, the employee already receives income on this date. This means that personal income tax must be withheld from both the first and second parts of the salary. Judges think the same (decision of the Supreme Court of the Russian Federation dated May 11, 2016 No. 309-KG16-1804).

Advance regulations

In labor legislation there is no such thing as an advance on wages. Article 136 of the Labor Code of the Russian Federation states that the employer is obliged to pay wages at least every half month. Moreover, this must be done no later than 15 calendar days from the end of the period for which this salary was accrued. An advance is called the first part of the salary, that is, the amount that the employee receives for the first half of the month.

What are the rules for calculating advance payments? The problem is that there are no clear regulations. Until recently, Resolution No. 556, issued in the middle of the last century by the Council of Ministers of the USSR, was in force. It established the following condition: the advance payment cannot be lower than the payment for the time actually worked. But at the beginning of October 2021, this resolution was canceled, which did not add clarity to the calculation of the advance. Now each employer decides these issues for himself. Let's consider what opinions exist.

When to pay personal income tax on an advance in 2018

Please take into account the explanations of the Ministry of Finance on how to withhold tax calculated from income in kind and other payments from an advance payment (see below).

How to pay personal income tax on an advance

Early payment of personal income tax on advance payments and salaries is prohibited. The tax transferred ahead of schedule is not a tax as such. Therefore, you will have to remit the tax twice.

A document that will be useful if

Notifying employees about changes in advance payment terms

Deadlines for payment of advance payments and wages in 2018

The days on which it is necessary to issue an advance and salary must be clearly stated in the employment contract with the employee, as well as in the local acts of the organization (for example, in the regulations on wages).

The law clearly states that no more than 15 days should pass between the issuance of these two parts. In addition, it is established that earnings for the first part of the month must be issued between the 15th and 30th days of the current month, and the final payment must be made between the 1st and 15th days of the month following it.

The administration does not have the right to establish in the documents a period of days during which the payment is expected to be made. However, it can be stipulated that the payment must be made before the specified date. Also, inaccurate dates should not be recorded. The document must clearly indicate the days on which the payment is made, and exactly what part of the salary is paid at that moment.

The law does not prohibit payments at more frequent intervals, for example every 10 days. But in any case, these dates must be indicated in the documents.

Attention! If the day on which the payment of one of the earnings falls falls on a non-working day, then the employer is obliged to make the payment on the previous working day.

It is not recommended to indicate the 15th and 30th as days of issue. This is due to the fact that in many months of the year the 30th day is the last, and therefore on this day the accountant will have to calculate and withhold personal income tax from the advance payment.

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Personal income tax from salary advance 2021: restrictions

For tax on income in kind or material benefits, no more than 50% of the payment can be withheld (clause 4 of Article 226 of the Tax Code of the Russian Federation). There is no special rule for personal income tax, which the company was unable to withhold from other income. Limits need to be looked at in other laws.

For wages and other payments for labor, there is a limit of 20% (Article 138 of the Labor Code of the Russian Federation). Employees may also receive rent money, cash gifts, or anniversary bonuses from the company. From such income, the company has the right to withhold all personal income tax, which it previously calculated from wages but did not withhold. Limits on withholding do not apply (letter of the Federal Tax Service of Russia dated October 26, 2016 No. BS-4-11/ [email protected] ).

Consider 50 or 20% of the income from which you withhold tax. The income from which you were unable to withhold personal income tax is not important. In this case, first withhold tax from your salary, and determine a 50% limit on the remainder.

Example

On May 29, the company forgave the director a debt of 250,000 rubles. and calculated personal income tax - 32,500 rubles. (RUB 250,000 × 13%). On May 30, she calculated personal income tax on the gift to the best sales manager - 8,580 rubles. ((RUB 70,000 – RUB 4,000) × 13%). On June 5, the company issued wages to employees.

Forgiveness loan. Director's salary - 50,000 rubles, personal income tax - 6,500 rubles. (RUB 50,000 × 13%). From the salary minus personal income tax, only 20% can be withheld as tax on the forgiven loan - 8,700 rubles. ((RUB 50,000 – RUB 6,500) × 20%). The difference is 23,800 rubles. (32,500 – 8,700) must be withheld from the following income. Including advance payment for June.

Present. Manager's salary - 30,000 rubles, personal income tax - 3,900 rubles. (RUB 30,000 × 13%). On account of personal income tax on a gift, the company has the right to withhold half of the salary minus tax - 13,050 rubles. ((RUB 30,000 – RUB 3,900) × 50%). This means that the company can immediately retain all 8,580 rubles.

Non-monetary personal income tax from advance in 2018

The tax that the company has calculated on material benefits or income in kind can be withheld from the salary advance. This conclusion was first made by the Ministry of Finance in letter dated 05.05.17 No. 03-04-06/28037.

Tax on material benefits, income in kind and any other personal income tax not withheld must be withheld from immediate cash income (clause 4 of article 226 of the Tax Code of the Russian Federation). The company does not withhold personal income tax from the advance payment itself (letter of the Federal Tax Service of Russia dated January 15, 2016 No. BS-4-11/320). It is not clear whether taxes calculated on income in kind and other payments can be withheld from the advance payment.

From what payments can personal income tax be withheld? In letter No. 03-04-06/28037, the Ministry of Finance came to the conclusion that the tax that the company calculated on non-cash income can be withheld from the advance payment. This is the logic of the officials. The company issues salaries to employees at least twice a month (Article 136 of the Labor Code of the Russian Federation). This means that each part is the employee’s income. It doesn’t matter that for personal income tax the date of receipt of income has not yet arrived. From the first part of the salary, you can still withhold personal income tax calculated from material benefits or gifts.

It’s another matter if the company issues a loan. Such a payment is itself exempt from personal income tax - it is not the employee’s income. Therefore, it is impossible to withhold tax from a loan that the company calculated from a benefit or gift. You need to wait for income or submit a certificate of unwithheld tax at the end of the year. In the memo, we have listed payments from which personal income tax can and cannot be withheld.

Important

From the letter from the Ministry of Finance, we can conclude that officials allowed the deduction of personal income tax from the advance payment itself. Actually this is not true. The date of receipt of salary income is the last day of the month for which it was accrued (clause 2 of Article 223 of the Tax Code of the Russian Federation). Therefore, there is no need to calculate and withhold tax from the advance payment itself.

From what payments should “non-monetary” personal income tax be withheld?

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