The procedure for taxation of material assistance in Russia in 2021

Financial assistance as a type of income

Such support, unlike other types of income, does not depend on:

from the employee’s activities;
from the results of the organization’s activities;
from the cyclical nature of work periods.

The grounds for receiving financial assistance can be divided into two: general and targeted. It is provided when any circumstances arise in the employee’s life:

anniversary, special event;
difficult financial situation;
illness of an employee or close family member;
death of an employee or close family member;
birth of a child;
emergencies;
vacation.

A complete list of grounds for calculating financial assistance, as well as their amounts, are established by the regulatory (local) document of the organization. In some cases, for example, due to illness, the amount of financial assistance will be determined by the decision of the manager.

Supporting documents

To avoid problems with the tax authorities, it is necessary to have supporting documents that serve as a reason for providing financial assistance to the employee. This is especially true for those situations in which payments in any amount are not subject to taxes. For example, if assistance is provided in connection with the death of a family member, then you need to ask the employee to provide a copy of the death certificate, as well as a document that confirms family ties - a marriage certificate or birth certificate.

The head of the organization must draw up an order for the allocation of financial assistance, and the employee must write a corresponding application, to which supporting documents are attached, as a basis for receiving payments. The application can be made in free form.

In the accounting department, a payment document is drawn up, which indicates the number and date of the order - it will serve as the basis for payment. If payments are not made at a time, then each document must contain a confirming link. This will avoid problems with tax authorities and justify payments allocated as financial assistance.

Taxation of financial assistance

The main question that an accountant asks is whether financial assistance is subject to personal income tax?

Each type has its own distinctive characteristics and accounting features for determining the personal income tax base, as well as insurance premiums. The personal income tax and contribution base depends on the basis for which financial assistance was provided. It is indicated in the employee’s application. Taxation of financial aid follows the same principles. At the same time, monetary support from the employer is either completely tax-free or not taxed up to an amount limit, which depends on the basis.

What is financial assistance to an employee?

Financial assistance to an employee is a one-time financial payment, which is provided in a number of exceptional cases, such as:

assistance with the treatment of an employee’s relative;
assistance at the birth of a child;
funeral assistance.

Belongs to the category of SOT (labor remuneration system), paid at the discretion of the employer. Before applying for financial assistance, an employee should inquire whether such a payment is included in the list of SOT of the organization in which he works.

Not taxed

The list of such income is specified in Art. 217 Tax Code of the Russian Federation. In particular, financial assistance, tax-free for 2021, is provided in the following cases:

death of an employee or a close member of his family;
natural disaster;
purchasing sanatorium and resort vouchers on the territory of the Russian Federation (compensation depending on the type of support, for example, for accompanying parents of children with disabilities to a place of recreation and recovery);
emergency situation (terrorist attack and others).

Is it subject to income tax?

Due to the fact that most types of financial assistance are exempt from personal income tax, an accountant must process this type of payment with the utmost correctness. To avoid tax evasion, the law establishes an exhaustive list of situations when a company can provide such assistance to an employee.

A material payment that is not subject to income tax must meet a number of requirements:

The non-taxable payment limit, calculated on an accrual basis for the year, should not exceed 4,000 rubles . Amounts in excess of the established norm are subject to personal income tax on a general basis. The preferential minimum is regulated by Art. 217 clause 28 of the Tax Code of the Russian Federation.
Full exemption is granted to assistance provided in connection with the death of a close relative (parent, child, spouse). This situation must be confirmed by relevant documents (proof of relationship, death certificate).
In the event of damage caused by a natural disaster, to confirm tax exemption, you must provide certificates from government services stating that such a phenomenon took place.
If assistance is required by an employee as a result of terrorist damage , then documentary evidence from the Ministry of Internal Affairs will be required.
The birth of a child is also a reason for providing a payment of up to 50 thousand rubles. This amount is legally exempt from income tax (Article 217, paragraph 8 of the Tax Code of the Russian Federation).
The company may provide assistance that will be used to pay for the treatment of the employee or his family members. Such payment must be made from the net profit of the enterprise (Article 217, paragraph 10).

Payments that do not meet the above parameters are subject to personal income tax in full. Also, undocumented events automatically lose their preferential status.

Taxed over the limit

This applies to support that is of a general nature by providing:

birth, adoption, establishment of guardianship rights - in the amount of no more than 50,000 rubles for each child when paid within 1 year after birth;
the amount of partial compensation for sanatorium and resort vouchers in the Russian Federation in the amount of up to 4,000 rubles (taking into account the type of assistance, for example, to support the health of children due to severe environmental and climatic conditions, etc.);
anniversary, special event (wedding) - up to 4,000 rubles;
support for an employee in a difficult life situation, vacation - up to 4,000 rubles.

Let us remind you that the limit of financial assistance for the birth of a child is 50,000 rubles per parent. Such clarifications were given by the Ministry of Finance of the Russian Federation in letter dated 08/07/2017 No. 03-04-06/50382. Previously, officials considered the set amount to be the limit for both parents or guardians.

IMPORTANT!

When calculating personal income tax, a deduction for financial assistance on a general basis up to 4,000 rubles is provided once, regardless of how many times the support is provided.

In what cases is financial assistance subject to personal income tax?

In some cases, financial assistance is subject to personal income tax:

Material aid	A comment	Normative act
In the part exceeding 4,000 rubles received on each of the following grounds for the tax period or reimbursement of payment for the cost of medicines that is not documented	· the amount of financial assistance provided by employers to their employees, as well as to their former employees who resigned due to retirement due to disability or age; · compensation (payment) by employers to their employees, their spouses, parents, children (including adopted children), wards (under the age of 18), their former employees (age pensioners), as well as disabled people for the cost of goods purchased by them (for them) medications for medical use prescribed by their attending physician. Tax exemption is provided upon presentation of documents confirming actual expenses for the purchase of these drugs for medical use.	clause 28 of article 217 of the Tax Code of the Russian Federation
In the portion exceeding 50 thousand rubles for each child	Employers to employees (parents, adoptive parents, guardians) at the birth (adoption) of a child, paid during the first year after the birth (adoption)	Clause 8 of Article 217 of the Tax Code of the Russian Federation

Example 1. A son was born into the Smirnov family. The employer plans to provide financial assistance to both parents in the amount of 50,000 rubles each. Thus, financial assistance in the amount of 50,000 rubles paid to one of the parents will be exempt from personal income tax, and financial assistance paid to the second parent will be subject to personal income tax calculation.

In general, the Smirnov family will receive financial assistance in the following amount:

50000+50000-(50000*13%)=93500 rubles.

Income codes and material support deduction codes

The personal income tax tax base codes are fixed in the Order of the Federal Tax Service dated September 10, 2015 No. ММВ-7-11/ [email protected] Depending on the basis of financial assistance, the following are determined:

material assistance income code (Appendix 1 of the Order of the Federal Tax Service);
deduction code that provides financial assistance (Appendix 2 of the Federal Tax Service Order).

Let's look at an example. As a result of the fire, the employee lost her husband, long-term treatment did not produce results, the employee took leave due to life circumstances. By decision of the head of the organization, the employee was provided with financial support:

in connection with a natural disaster - 100,000 rubles;
in connection with the death of a spouse - 80,000 rubles;
compensation for the cost of treatment - 60,000 rubles;
in accordance with the collective agreement, when taking annual leave, an employee is entitled to support in the amount of two salaries (salary for the position held is 20,000 rubles), thus, financial assistance for leave amounted to 40,000 rubles.

Below we discuss the taxation of financial assistance to an employee in 2021, as well as financial assistance up to 4000 (2021 taxation).

How to reflect financial assistance to employees in accounting and tax accounting

Financial assistance in accounting and tax reporting is calculated as follows:

Basis of financial assistance	Revenue code	Deduction code
due to the death of a family member	The 2-NDFL certificate is not reflected
due to a natural disaster or other emergency
in connection with the birth of a child during the first year of his life, if the amount of financial assistance does not exceed 50,000 rubles. based on both parents
on other grounds, if the total amount of financial assistance does not exceed 4,000 rubles. in a year
in connection with the birth of a child during the first year of his life, if the amount of financial assistance exceeds 50,000 rubles. based on both parents	2762	508
on other grounds, if the total amount of such financial assistance exceeds 4,000 rubles. in a year	2760	503

Financial assistance to an employee is a one-time financial payment, which is provided in a number of exceptional cases. If an employee applies for financial assistance from an employer, then he must draw up a corresponding application addressed to the director of his company. It is imperative to justify the reason why financial assistance is required. In accordance with Article 270 of the Tax Code of Russia, paragraph 23, material assistance cannot be taxed, since it is not classified as profit.

Calculation of the base for insurance premiums

IMPORTANT!
If payments are reflected in one of the reporting forms, then, based on clause 3 of the inter-document control relationships, prepare explanations for discrepancies in the forms. For example, non-taxable income not indicated in the 2-NDFL certificate and reflection of the dates of transfers for the specified payments in the 6-NDFL form.

Finally, let’s figure out whether financial assistance is subject to insurance contributions or not.

When determining the base of insurance premiums, support amounts are legally excluded on the same grounds as the base for calculating personal income tax.

Financial assistance not more than 4,000 rubles

When exempting material assistance from personal income tax, the purpose of the payment does not play a major role. It is important that the payment amount does not exceed four thousand rubles per person during the year. This kind of payment can be made as a gift (material assistance) for an anniversary, holiday or other significant event. This assistance is also called stimulating assistance. Thus, what is important is the amount of assistance, which should not exceed the 4,000 ruble mark, and not the purpose of the payment. The corresponding conclusion is confirmed by paragraph 28 of Article 217 of the Tax Code of the Russian Federation and Letter of the Ministry of Finance of the Russian Federation dated October 22, 2013 No. 03-03-06/4/44144. When paying no more than 4,000 rubles, personal income tax is not assessed.

If the payment exceeds the established threshold (4,000 rubles), then personal income tax must be charged on the excess amount. For example, Sidorov A.P. submitted an application for financial assistance on March 20. A few days later, on March 24, the manager issues an order to pay A.P. Sidorov. financial assistance in the amount of 7,000 rubles; money is issued on the same day. This amount is included in the personal income tax base for March. And since the payment exceeds the threshold established at 4,000 rubles, personal income tax is withheld from 3,000 rubles (7,000 - 4,000). We get that personal income tax will be 3,000 × 13% = 390 rubles. Sidorov A.P. will receive 7,000 - 390 = 6,610 rubles.