Conservation of fixed assets tax and accounting

Content

• What is OS conservation?
• Reasons for preserving the OS
• Consequences of conservation
• What property can be conserved?
• The procedure for registration of conservation
• More information about depreciation of fixed assets: general information
• What happens to depreciation when mothballing fixed assets?
• On the procedure for paying taxes when mothballing fixed assets
• Sale of objects under conservation
• OS depreservation procedure

Termination and resumption of accruals

Many experts have a question: from what time should they suspend and then begin calculating depreciation for fixed assets transferred to conservation for a period of more than 3 months? The company sets the month for termination and resumption of accruals independently. The option that is chosen must be recorded in its accounting policy. The legislation does not establish a specific moment for stopping and resuming payments for funds mothballed for more than 3 months. The accounting policy should record one of the following options:

1. Depreciation charges are suspended from the 1st day of the month when fixed assets were mothballed. The calculation should be resumed from the first day of the period in which the OS was put back into production.
2. Accrual stops on the 1st day of the month following the month during which the fixed assets were mothballed. The calculation is resumed from the first day of the period that follows the period during which the OS was put into production.

What is OS conservation?

Conservation is a set of measures to temporarily stop using one or more fixed assets of an organization. Conservation involves the resumption of operation of the OS after a documented period.

The word itself comes from the Latin conservatio - “preservation”, which indicates the ultimate goal of the entire event - to save both the object itself and part of the funds in the company’s current accounts, by reducing expenses.

The conservation of an object can be compared to the suspended animation of a crocodile, when under unfavorable conditions the animal buries itself in the sand and all its vital functions slow down. Likewise, an object slows down its life inside the enterprise and - the main characteristic - temporarily does not bring economic benefits to its owners. By law, this “hibernation” cannot exceed three years. But practice shows that the conservation period of fixed assets can be extended.

VAT at OSNO

The procedure for conserving fixed assets does not provide for the restoration of value added tax from their residual price. But while the OS is in an unused state or when it is returned to an asset, the enterprise may have an obligation to charge VAT. The tax should be restored in cases where:

1. The OS is transferred to the authorized capital of another company.
2. The company switches from OSNO to UTII or simplified tax system.
3. The use of VAT exemption has begun.
4. After reactivation, the fixed asset is used to perform operations that are not subject to this tax.

These requirements are established in Art. 170, paragraph 3 of the Tax Code.

Reasons for preserving the OS

This event is used, for example, in the following cases:

• The end of seasonal work, when the facilities cannot be used at other times (snow removal equipment, harvesting machines);
• Temporary downtime in production (looms with a shortage of threads);
• Reduction in production due to economic realities (non-use of one of the workshops);
• Breakdown of an object and its transfer for repairs, including the absence of necessary parts (tractor repair due to malfunctions).

What does conservation actually mean?

To do this, you must provide an action plan in two directions:

1. Actual conservation;
2. Reflection in documentation and in the accounting program.

The first point includes all actions related directly to your main asset. While the property is idle, it must be kept safe and in good condition.

For example, in agriculture, special equipment is used to treat fields with herbicide. This equipment is needed only in spring and summer; in cold weather, it needs to be given a place in a closed hangar, the engine should be started periodically, and the hangar should be protected from thieves.

On the other hand, conservation must be recorded in documents - it is not enough just to actually stop using the property and put it under lock and key.

Consequences of conservation

Conservation is a voluntary procedure. Even if you do not use your building, equipment or vehicle for the needs of the organization, and they become covered with dust, the tax authorities cannot oblige you to carry out this procedure.

This begs the question - if the law does not oblige you to re-register the status of an unused asset, why do you need the extra hassle? Let it sit until you need it again. Only benefits that will significantly outweigh the inconvenience and expense of it can persuade you in favor of documentary conservation.

Each enterprise must calculate the pros and cons for its specific situation and decide which path will be economically justified.

Still, there are some general points:

Other costs

The question often arises whether it is possible to include utility bills, lighting and security costs for a building under conservation in the calculation of income tax. Yes, these expenses are included in non-operating expenses. This provision is present in Art. 265, clause 1, sub. 9 NK. The enterprise, therefore, has the right to reflect in tax reporting the costs aimed at preserving mothballed OS in proper condition. At the same time, according to Art. 252, paragraph 1 of the Tax Code, it is necessary to have documentary evidence and economic justification for these expenses. The costs that entail the conservation of fixed assets aimed at servicing farms and production should be reflected separately.

What property can be conserved?

If the property is classified as fixed assets - that is, it is reflected in account 01 - conservation can be carried out.

Let us remind you that not all company property can be classified as OS.

To do this, four conditions must be met:

Examples of fixed assets: houses, structures, transport, tools, office equipment, household equipment, land, water, subsoil.

The following do not apply to fixed assets: finished products, materials and goods in stock. Materials or objects in transit or during installation.

No one is conserving natural resources (land, water, subsoil), which is easily explained: according to the law of the Russian Federation, depreciation is not charged on these objects. Since fixed assets are often preserved in order to suspend depreciation charges, this reason does not apply in this situation.

Why aren't natural resources depreciated? It is believed that they can be used endlessly and will not “wear out”, although in fact they can become depleted with active use.

The procedure for registration of conservation

The conservation procedure is strictly regulated for budgetary and government institutions. As for commercial enterprises, practice shows that tax authorities are more loyal to registration of conservation.

In order for conservation to be considered legal and for you to stop accruing depreciation on fixed assets with a clear conscience, you need to take several steps:

1. The company's management is assessing whether conservation is advisable. Decisions are made at general meetings.
2. When the decision is made, an order is issued.
3. An OS inventory is being carried out.
4. An act on the transfer of fixed assets to conservation is drawn up.
5. The information is reflected in the 1C program.

simplified tax system

The tax base of simplified organizations that pay a single tax on income is not reduced by the costs of preserving fixed assets. With this object of taxation, no expenses are taken into account (clause 1 of Article 346.18 of the Tax Code of the Russian Federation).

For simplified organizations that pay a single tax on the difference between income and expenses, conservation costs reduce the tax base, provided that they are listed in Article 346.16 of the Tax Code of the Russian Federation. For example, when calculating a single tax, you can take into account:

• materials (for example, lubricants and packaging materials) for the maintenance of mothballed fixed assets (subclause 5, clause 1, article 346.16 of the Tax Code of the Russian Federation);

• salaries of employees performing conservation work on fixed assets (subclause 6, clause 1, article 346.16 of the Tax Code of the Russian Federation).

Reduce the tax base as expenses for the conservation of fixed assets arise and are paid (clause 2 of Article 346.17 of the Tax Code of the Russian Federation).

Situation: is it possible for an organization to take into account in a simplified manner the costs of purchasing fixed assets that have been placed on mothballing for a period of more than three months?

No you can not.

When simplified, the tax base can be reduced by expenses for the acquisition of fixed assets recognized as depreciable property in accordance with Chapter 25 of the Tax Code of the Russian Federation (subclause 1, clause 1 and clause 4, article 346.16 of the Tax Code of the Russian Federation).

Fixed assets transferred to conservation for a period of more than three months are excluded from depreciable property (paragraph 3, paragraph 3, article 256 of the Tax Code of the Russian Federation). Therefore, in those reporting periods in which the fixed asset was transferred to conservation for a period of more than three months, the costs of its acquisition are not taken into account. A similar point of view is reflected in the letter of the Federal Tax Service of Russia dated December 14, 2006 No. 02-6-10/233.

More information about depreciation of fixed assets: general information

Depreciation is a gradual reduction in the cost of an asset due to its wear and tear through the monthly inclusion of a share of its cost in the cost of production.

How are these write-off shares calculated? Their value is directly related to the concept of useful life of the asset (SPI). The length of the period is partially chosen by the organization, but only within specified limits. These frameworks are prescribed in the official document - OS classification.

In this classification, all possible fixed assets are divided into ten groups. The first group lists those operating systems whose SPI ranges from one year to two years. In the last, tenth group - OS with a service life of more than thirty years.

Example . Hunting and sporting weapons belong to the fifth depreciation group with a life expectancy period of seven to ten years. An organization can set the SPI for its operating system for seven, eight, nine or ten years - at its discretion.

After choosing the SPI with a linear depreciation system (in many ways the most convenient), it is calculated how much will have to be depreciated per month. For example, if a hunting weapon cost 70,000 rubles with a life expectancy of 7 years, you will need to write off:

• 70,000/7 = 10,000 rubles per year.
• 10,000/12 = 833.3 rubles per month.

What happens to depreciation when mothballing fixed assets?

If conservation does not exceed three months, depreciation is accrued on fixed assets as usual. For a longer period, as we have already discussed, depreciation is suspended.

Depreciation ceases to accrue from the first day of the month following the month in which the conservation order was issued. For example, if conservation is approved on August 15, it is no longer accrued from September 1.

Temporarily not accruing depreciation is often one of the main goals of conservation and a legal way not to do it. On the one hand, in the long term this is not very profitable. After all, fully depreciated property is listed on the balance sheet with a zero value, therefore, there is no need to pay property tax on it, while a “frozen” asset will appear on the balance sheet with its previous value, and not with its residual value.

On the other hand, if the owner, due to a decline in production, has an entire fleet of equipment idle with a huge cost and, as a result, with huge depreciation, he will not be able to include this depreciation in the cost of the finished product - otherwise it will skyrocket.

Accounting

When preserving a fixed asset for a period of no more than three months, calculate depreciation on it. If a fixed asset is mothballed for a period of more than three months, then suspend depreciation on it. In this case, resume depreciation after reactivation of the fixed asset. This procedure is established in paragraph 23 of PBU 6/01 and paragraph 63 of the Methodological Instructions, approved by Order of the Ministry of Finance of Russia dated October 13, 2003 No. 91n.

For accounting purposes, extension of the useful life in connection with the conservation of a fixed asset for a period exceeding three months is not provided. However, in accounting, depreciation can be calculated even after the end of its useful life (clause 22 of PBU 6/01). Therefore, after re-preservation, depreciation on the fixed asset is calculated in the order that was in effect before the start of mothballing.

Situation: at what point in accounting should you stop and then resume depreciation on a fixed asset transferred to conservation for a period of more than three months?

The month from which the accrual of depreciation for accounting purposes stops and resumes must be established independently by the organization. The chosen option for suspending and resuming the calculation of depreciation should be reflected in the organization’s accounting policies for accounting purposes.

For accounting purposes, the specific moment of termination and resumption of depreciation on fixed assets transferred to conservation for a period of more than three months is not established by law. The organization determines the procedure for conservation independently (paragraph 2, clause 63 of the Methodological Instructions, approved by order of the Ministry of Finance of Russia dated October 13, 2003 No. 91n).

You can specify one of the following options in your accounting policy:

• depreciation is suspended from the 1st day of the month in which the fixed asset was transferred for conservation. And it is renewed - from the 1st day of the month in which the main asset was re-opened;

• depreciation is suspended from the 1st day of the month following the month in which the fixed asset was transferred for conservation. And it is resumed from the 1st day of the month following the month in which the main asset was re-opened.

An example of suspending depreciation of a fixed asset transferred to conservation

CJSC Alfa decided to mothball the equipment for the period from June 23 to November 26. The accounting policy of the organization for accounting purposes states that when mothballing objects for a period of more than three months, depreciation is calculated:

• suspended from the month following the month of the start of conservation;
• resumes from the month following the month of removal from conservation.

The estimated conservation period exceeds three months. Therefore, based on the order of the manager, Alpha’s accountant stopped accruing depreciation on mothballed objects from July 1. Depreciation was resumed on December 1 after the facilities were re-opened.

Advice: in your accounting policy for accounting purposes, establish the same procedure for stopping and resuming depreciation on fixed assets mothballed for a period of more than three months, as in tax accounting. In this case, temporary differences will not arise in the organization’s accounting, leading to the formation of a deferred tax liability.

The organization is obliged to keep records of fixed assets according to the degree of their use:

• in operation;

• in stock (reserve);

• for conservation, etc.

This is stated in paragraph 20 of the Methodological Instructions, approved by order of the Ministry of Finance of Russia dated October 13, 2003 No. 91n.

Accounting for fixed assets by degree of use can be carried out with or without reflection on account 01 (03). Thus, when mothballing for a period of more than three months, it is advisable to account for fixed assets in a separate sub-account “Fixed Assets for Conservation”. This approach is consistent with paragraph 20 of the Methodological Instructions, approved by Order of the Ministry of Finance of Russia dated October 13, 2003 No. 91n.

Debit 01 (03) subaccount “Fixed assets in conservation” Credit 01 (03) subaccount “Fixed assets in operation” - fixed assets were transferred to conservation.

After reactivating the fixed asset, make the following wiring:

Debit 01 (03) subaccount “Fixed assets in operation” Credit 01 (03) subaccount “Fixed assets in conservation” – the fixed asset has been reactivated.

When carrying out conservation and re-preservation of fixed assets, the organization may incur expenses. For example, material costs (various lubricants and packaging materials), costs for dismantling and installing equipment, etc. Costs for conservation and re-preservation, as well as costs for maintaining mothballed fixed assets, should be reflected in accounting as part of other expenses:

Debit 91-2 Credit 10 (23, 60, 68, 69, 70...) – expenses for conservation, re-preservation and maintenance of mothballed fixed assets are taken into account.

This procedure follows from paragraph 11 of PBU 10/99, Instructions for the chart of accounts (account 91) and letter of the Ministry of Finance of Russia dated January 13, 2003 No. 16-00-14/7.

An example of reflection in accounting and taxation of conservation of fixed assets. Depreciation is calculated using the straight-line method.

In July, by order of the head of OJSC “Proizvodstvennaya”, the production line was placed on mothballing for 4 months. The initial cost of the production line is RUB 780,000.

“Master” applies the accrual method and pays income tax quarterly. Accounting and tax accounting data are the same. Master calculates depreciation in accounting and tax accounting using the straight-line method. The organization does not perform operations that are not subject to VAT.

In July, Master's expenses for work on mothballing the production line amounted to:

– 500 rub. – material costs (various lubricants and packaging materials);

– 1000 rub. – wages of employees who carried out work on the conservation of the production line (including contributions to compulsory pension (social, medical) insurance and insurance against accidents and occupational diseases).

In November, the production line was reopened. “Master”’s expenses for carrying out the re-preservation work consisted of the salaries of the employees who carried out the work on the preservation of the production line (including contributions for compulsory pension (social, medical) insurance and insurance against accidents and occupational diseases) in the amount of 1000 rubles.

From August to November, Master's accountant did not accrue depreciation on the mothballed production line in accounting and tax accounting. Since December, the accountant has resumed calculating depreciation on the production line. Both before and after conservation, the monthly amount of depreciation deductions for accounting and tax accounting purposes amounted to 13,000 rubles.

The Master's accountant made the following entries in the accounting.

In July:

Debit 01 subaccount “Fixed assets in conservation” Credit 01 subaccount “Fixed assets in operation” – 780,000 rubles. – the production line was mothballed;

Debit 91-2 Credit 10 (70, 69) – 1500 rub. (1000 rub. + 500 rub.) – the costs of carrying out work to preserve the production line are taken into account;

Debit 25 Credit 02 – 13,000 rub. – depreciation has been accrued on the production line.

In November:

Debit 01 subaccount “Fixed assets in operation” Credit 01 subaccount “Fixed assets in conservation” – 780,000 rubles. – the production line was reactivated;

Debit 91-2 Credit 70 (69) – 1000 rub. – the costs of work on reactivating the production line are taken into account.

December:

Debit 25 Credit 02 – 13,000 rub. – depreciation has been accrued on the production line.

The input VAT on the cost of materials used in the conservation work of the fixed asset was accepted for deduction by the Master's accountant.

Master's accountant took the residual value of the mothballed production line into account when calculating property taxes.

The accountant reduced the tax base for income tax by the costs of performing work on mothballing and re-mothballing the production line:

– 1500 rub. (1000 rubles + 500 rubles) – taken into account when preparing the income tax return for nine months of the current year;

– 1000 rub. – taken into account when preparing the income tax return for the year.

In addition, when preparing the income tax return, the accountant took into account depreciation charges for the production line.

On the procedure for paying taxes when mothballing fixed assets

Conservation of an asset does not exempt an enterprise from paying transport tax (if the asset relates to vehicles); as for property tax, it also remains payable.

Now about VAT. If a company operates under OSNO and is a VAT payer, when purchasing OS, “input VAT” is deducted. This means that this amount of VAT allocated in the invoice from the supplier will ultimately reduce the amount of tax that needs to be paid to the budget.

For some operations with fixed assets, it is necessary to restore VAT, that is, still pay it to the budget, although before that it was accepted for deduction. This must be done, for example, when contributing OS to the authorized capital or when the organization switches to the simplified tax system.

All these cases are regulated by law, but conservation is not among them. Therefore, when preserving an OS, there is no need to look for primary documents with the specified VAT when purchasing an OS and transfer it to the budget.

Foundation conservation

Preservation is not necessary for all types of foundations, but only for strip and slab foundations. Practical recommendations are given by a specialist, Gleb Tikhonov.

Gleb Tikhonov

Preservation of a strip foundation consists of three stages: - waterproofing; — insulation; - water drainage.

If the foundation is a monolithic slab, only the sidewalls are insulated. Insulation and insulation are carried out no earlier than four weeks after pouring.

For waterproofing, roofing felt or reinforced film is used; the pieces are overlapped with a margin and pressed down. The insulation is usually slabs of extruded polystyrene foam (EPS) or polystyrene foam (PSB). The depth of insulation is up to the level of soil freezing. On top of the insulation is a layer of reinforced film.

Since the slab foundation is already insulated from below, the slab is covered with film for waterproofing. You can either line the sides with EPS or PSB, or fill them with expanded clay or slag.

To drain water, in a lowland, at a distance from the foundation (about five meters), they dig a pit a couple of meters in diameter. To drain water, drainage ditches are dug along the entire perimeter of the structure, combined into a common system and directed to the drainage basin.

Forum members who are faced with the need to postpone construction until spring, at the stage of pouring the foundation, agree with the specialist.

AndreyV Member of FORUMHOUSE

Place insulation under the blind area around the slab, ensuring surface water drainage. Cover the stove itself with film so that it does not get wet or become saturated with water.

Sale of objects under conservation

The sale of objects under conservation has features characteristic of the sale of depreciable property - despite the fact that during long-term conservation, depreciation is suspended.

The similarity is that in such a sale the seller has the right to reduce the declared profit by the residual value of the fixed assets - the value that remains after accrued depreciation even before conservation.

Example . The company bought the device for the amount of 120,000 rubles. According to the classification, it will be used for five years (60 months). The monthly depreciation charge was 2,000 rubles. Three years passed, during which accrued depreciation reduced the cost of the device by 72,000 rubles. The current residual value was 48,000 rubles (120,000 - 72,000).

The device was mothballed for the entire fourth year. After which the device was sold for 82,600 rubles, including VAT of 12,600 rubles.

For tax purposes, income from sales amounted to 70,000 (82,600 - 12,600).

The company declares a profit of 22,000 rubles (the amount is 70,000, reduced by the residual value of the device - 48,000 rubles).

If the residual value exceeds the proceeds from sale, the difference between these indicators will be recognized as a loss.

In this case, it is necessary to establish the actual service life of the facility - that is, take away months of downtime. And it is from this figure that the period for writing off the loss is calculated. The loss is distributed in equal shares over the months of the period found as part of other expenses.