Emergence of the right to compensation from the Federal Tax Service
The amount of overpaid/collected tax shall be refunded to the taxpayer. The general procedure for the refund of taxes and insurance premiums, as well as the refund deadlines, are established by Art. 78 and 79 of the Tax Code of the Russian Federation. Along with the refund of overpaid taxes, tax authorities are required to accrue and pay interest, which represents monetary compensation for the unlawful use of payers’ funds.
The right to receive interest on the amount of overpaid/collected taxes arises:
- upon the fact of excessive collection of taxes by decision of the Federal Tax Service
- if tax officials violate deadlines for returning voluntarily overpaid amounts.
The moment at which interest begins to accrue depends on the basis for the overpayment. If the overpayment occurred due to an error by the payer himself, interest is accrued from the day the Federal Tax Service Inspectorate violates the monthly deadline for tax refund.
If the tax overpaid due to the fault of the payer himself was returned by the Federal Tax Service independently (before the payer came to his senses and wrote a statement), interest is not charged on the amount of the overpayment (clause 2 of Article 78 of the Tax Code of the Russian Federation).
If the overpayment arose as a result of the collection of taxes by decision (demand) of the tax authorities, interest is accrued from the date of collection of taxes (clause 5 of Article 79 of the Tax Code of the Russian Federation).
Where to apply to collect interest from the tax office
The Tax Code of the Russian Federation does not establish a procedure for filing an application for recovery from the Federal Tax Service of interest accrued on the amount of overpaid taxes. Consequently, the procedure for filing such an application is chosen by the taxpayer himself.
For a refund of tax and interest, he can apply to the Federal Tax Service at the place of his registration (as part of filing an application for a refund of the tax itself), or he can submit the corresponding application directly to the court.
If the payer decides to act through the court, then the application must indicate the circumstances of the overpayment of tax, the emergence of the right to receive interest, and also calculate the due interest.
Interest payable to the taxpayer is accrued for each calendar day of violation of the return deadline. Interest stops accruing from the moment the overpayment is returned. The interest rate is taken equal to the refinancing rate of the Central Bank of the Russian Federation, which was in effect during the period of violation of the repayment deadline (clause 10 of Article 78 of the Tax Code of the Russian Federation).
Calculation of interest on voluntary overpayment of taxes
In cases where overpayment of taxes occurs due to the fault of the payer himself (incorrect application of the tax rate, erroneous overestimation of the taxable base, etc.), a mandatory condition for collecting interest from the Federal Tax Service is the declaration of rights to return the amount of the overpayment.
Interest in such cases begins to accrue only if there is a taxpayer’s application submitted to the Federal Tax Service for a refund of overpaid tax. Without filing such an application, the inspectorate has no obligation to refund taxes and, accordingly, pay interest on the amount of untimely returned payments.
In order to receive back the overpaid tax and, possibly, monetary compensation, the payer is required to submit an application to the tax office at the place of his registration. The application form was approved by order of the Federal Tax Service of Russia dated February 14, 2017 No. ММВ-7-8/ [email protected] The application, among other things, indicates the details of the taxpayer’s bank account to which the tax and interest are returned, the amount of overpaid tax and the BCC for the overpaid tax.
Taxes and contributions must be returned within one month from the date the tax authority received this application. Otherwise, along with the tax, the Federal Tax Service will be obliged to return to the payer the interest accrued on the amount of untimely returned tax.
Interest is accrued not from the day the tax is paid in an inflated amount, but from the day that follows the elapsed month allotted to the tax authorities to return the overpaid amounts.
The application for a refund of overpaid tax can be submitted within three years from the date of payment.
The law does not provide for a separate application form for collecting interest on the amount of untimely returned overpayment. Moreover, payers are not required to declare such interest. Interest is calculated and accrued by the tax authorities themselves upon missing a month's deadline (Clause 10, Article 78 of the Tax Code of the Russian Federation).
If the payer demands the return of the overpayment and interest through the court, bypassing the stage of filing a refund application (for example, if a three-year deadline is missed), then the court will refuse to collect the interest. This is due to the fact that in case of voluntary overpayment, interest is accrued one month from the date of filing the relevant application.
Clarification of the amount of interest by the tax authority
If the tax authority did not pay the interest or paid it in full, it must pay it in addition (clauses 10, 11, 12 of Article 78 of the Tax Code of the Russian Federation).
The additional payment occurs within three days after receiving notification from the Federal Treasury about the date of actual return of the overpayment amount (clause 6, article 6.1, clause 12, article 78 of the Tax Code of the Russian Federation). Next, the inspection makes a decision on the return of interest for the remaining days of delay and sending the order to the Federal Treasury.
Example
The application for the return of the overpaid amount was drawn up on January 26, 2020.
Returns must be made no later than 02/26/2020.
The decision to refund the overpayment was made by the tax authority on April 20, 2020.
The delay amounted to 53 calendar days - from 02/27/2020 to 04/20/2020 inclusive.
The inspectorate calculated the interest for 53 days and on the same day sent a payment order to the Federal Treasury to transfer it to the taxpayer.
On April 25, 2020, the inspection received a notification from the Federal Treasury that the refund of the overpayment and interest payment were made on April 24, 2020.
Therefore, for the period from 04/21/2020 to 04/24/2020 (4 days), the inspection must accrue an additional amount of interest and no later than 04/28/2020 send an order to the Federal Treasury to transfer it to the taxpayer.
How to return interest in case of excessive tax collection
According to the law, the tax authority, having established the fact of excessive tax collection, is obliged to inform the taxpayer about this within 10 days from the date of establishing this fact. The specified message is transmitted to the head of the organization, individual entrepreneur, their representatives personally against signature or in another way (clause 4 of article 79 of the Tax Code of the Russian Federation).
But on its own initiative, the Federal Tax Service is not obliged to return excessively collected tax amounts. Therefore, refund of tax and interest in such situations is also carried out in a declarative manner. To receive a refund, you will need to submit an application in the form approved. by order of the Federal Tax Service of Russia dated February 14, 2017 No. ММВ-7-8/ [email protected]
There is no need to submit a separate application for the accrual of interest on the amount of overcharged tax. The tax is refundable with interest already accrued on it.
At the same time, in contrast to a voluntary overpayment in the event of excessive collection of tax, the accrual of interest on its amount does not depend on the fact of filing an application for a refund. Interest in such cases is accrued not from the end of the month from the date of submission of the application to the Federal Tax Service, but from the moment the tax is collected.
Therefore, in principle, the taxpayer may not report the accrual and return of interest to the Federal Tax Service, but file a claim directly with the court.
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The amount of overpaid/collected tax shall be refunded to the taxpayer. The general procedure for the refund of taxes and insurance premiums, as well as the refund deadlines, are established by Art. 78 and 79 of the Tax Code of the Russian Federation.
Along with the refund of overpaid taxes, tax authorities are required to accrue and pay interest, which represents monetary compensation for the unlawful use of payers’ funds.
The right to receive interest on the amount of overpaid/collected taxes arises:
- upon the fact of excessive collection of taxes by decision of the Federal Tax Service
- if tax officials violate deadlines for returning voluntarily overpaid amounts.
The moment at which interest begins to accrue depends on the basis for the overpayment. If the overpayment occurred due to an error by the payer himself, interest is accrued from the day the Federal Tax Service Inspectorate violates the monthly deadline for tax refund.
If the tax overpaid due to the fault of the payer himself was returned by the Federal Tax Service independently (before the payer came to his senses and wrote a statement), interest is not charged on the amount of the overpayment (clause 2 of Article 78 of the Tax Code of the Russian Federation).
If the overpayment arose as a result of the collection of taxes by decision (demand) of the tax authorities, interest is accrued from the date of collection of taxes (clause 5 of Article 79 of the Tax Code of the Russian Federation).
Where to apply to collect interest from the tax office
The Tax Code of the Russian Federation does not establish a procedure for filing an application for recovery from the Federal Tax Service of interest accrued on the amount of overpaid taxes. Consequently, the procedure for filing such an application is chosen by the taxpayer himself.
For a refund of tax and interest, he can apply to the Federal Tax Service at the place of his registration (as part of filing an application for a refund of the tax itself), or he can submit the corresponding application directly to the court.
If the payer decides to act through the court, then the application must indicate the circumstances of the overpayment of tax, the emergence of the right to receive interest, and also calculate the due interest.
Interest payable to the taxpayer is accrued for each calendar day of violation of the return deadline. Interest stops accruing from the moment the overpayment is returned. The interest rate is taken equal to the refinancing rate of the Central Bank of the Russian Federation, which was in effect during the period of violation of the repayment deadline (clause 10 of Article 78 of the Tax Code of the Russian Federation).
Calculation of interest on voluntary overpayment of taxes
In cases where overpayment of taxes occurs due to the fault of the payer himself (incorrect application of the tax rate, erroneous overestimation of the taxable base, etc.), a mandatory condition for collecting interest from the Federal Tax Service is the declaration of rights to return the amount of the overpayment.
Interest in such cases begins to accrue only if there is a taxpayer’s application submitted to the Federal Tax Service for a refund of overpaid tax. Without filing such an application, the inspectorate has no obligation to refund taxes and, accordingly, pay interest on the amount of untimely returned payments.
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In order to receive back the overpaid tax and, possibly, monetary compensation, the payer is required to submit an application to the tax office at the place of his registration. The application form was approved by order of the Federal Tax Service of Russia dated February 14.
2017 No. ММВ-7-8/ [email protected] The application, among other things, indicates the details of the taxpayer’s bank account to which tax and interest are returned, the amount of overpaid tax and the BCC for the overpaid tax.
Taxes and contributions must be returned within one month from the date the tax authority received this application. Otherwise, along with the tax, the Federal Tax Service will be obliged to return to the payer the interest accrued on the amount of untimely returned tax.
Interest is accrued not from the day the tax is paid in an inflated amount, but from the day that follows the elapsed month allotted to the tax authorities to return the overpaid amounts.
The application for a refund of overpaid tax can be submitted within three years from the date of payment.
The law does not provide for a separate application form for collecting interest on the amount of untimely returned overpayment. Moreover, payers are not required to declare such interest. Interest is calculated and accrued by the tax authorities themselves upon missing a month's deadline (Clause 10, Article 78 of the Tax Code of the Russian Federation).
If the payer demands the return of the overpayment and interest through the court, bypassing the stage of filing a refund application (for example, if a three-year deadline is missed), then the court will refuse to collect the interest. This is due to the fact that in case of voluntary overpayment, interest is accrued one month from the date of filing the relevant application.
How to return interest in case of excessive tax collection
According to the law, the tax authority, having established the fact of excessive tax collection, is obliged to inform the taxpayer about this within 10 days from the date of establishing this fact. The specified message is transmitted to the head of the organization, individual entrepreneur, their representatives personally against signature or in another way (clause 4 of article 79 of the Tax Code of the Russian Federation).
But on its own initiative, the Federal Tax Service is not obliged to return excessively collected tax amounts. Therefore, refund of tax and interest in such situations is also carried out in a declarative manner. To receive a refund, you will need to submit an application in the form approved. by order of the Federal Tax Service of Russia dated February 14, 2017 No. ММВ-7-8/ [email protected]
There is no need to submit a separate application for the accrual of interest on the amount of overcharged tax. The tax is refundable with interest already accrued on it.
At the same time, in contrast to a voluntary overpayment in the event of excessive collection of tax, the accrual of interest on its amount does not depend on the fact of filing an application for a refund. Interest in such cases is accrued not from the end of the month from the date of submission of the application to the Federal Tax Service, but from the moment the tax is collected.
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Therefore, in principle, the taxpayer may not report the accrual and return of interest to the Federal Tax Service, but file a claim directly with the court.
Procedural deadlines
An application for a refund of overpaid tax with interest accrued on its amount may be submitted to the Federal Tax Service within three years. The procedure for calculating this period depends on the basis for the overpayment.
For example, if a tax is overpaid due to the fault of the payer, the three-year period begins to be calculated from the date of payment of the tax (Clause 7, Article 78 of the Tax Code of the Russian Federation). In the case of forced payment of tax, the period for filing an application is calculated from the day when the taxpayer became aware of the fact of excessive collection of tax from him (clause 3 of Article 79 of the Tax Code of the Russian Federation).
Missing the three-year period does not deprive payers of the right to return the overpayment and interest on it. This period is established only for the return of taxes/interest through the Federal Tax Service without going to court.
Therefore, if the payer has not applied to the inspectorate for a refund of taxes and interest within three years, he may demand their collection in court. In this case, the general rules for calculating the limitation period apply - within three years from the day the person learned or should have learned about the violation of his right (Articles 196 and 200 of the Civil Code of the Russian Federation).
The moment from which the payer must become aware of a violation of his right to a refund of taxes and interest is determined by the courts in different ways. It all depends on the reasons why the taxpayer overpays the tax, as well as on whether the payer has the ability to correctly calculate the tax.
If the payer decides to collect tax and interest by challenging the actions or decisions of the Federal Tax Service (decision to refuse a refund), then the statute of limitations established in clause 4 of Art. 198 Arbitration Procedure Code of the Russian Federation. This period is only three months from the day the taxpayer became aware of a violation of his rights.
Pre-trial settlement
Claims for the recovery of interest accrued on the amount of untimely returned/collected taxes are of a property nature. Therefore, these requirements are not subject to the procedure for pre-trial settlement of disputes with tax authorities established by Art. 138 Tax Code of the Russian Federation.
Let us recall that, according to this article, acts of tax authorities of a non-normative nature, actions or inactions of their officials can be appealed in court only after they have been appealed to a higher tax authority.
Therefore, if the payer makes a demand to collect interest from the Federal Tax Service, there is no question of appealing the decisions and actions of the tax authorities. Therefore, there is no need to appeal to a higher tax authority the refusal of the Federal Tax Service to return overpaid tax and interest. It is enough for the payer to file a claim in court to recover the appropriate amounts from the Federal Tax Service.
The norms of the Tax Code of the Russian Federation do not contain special requirements for a mandatory pre-trial procedure for resolving disputes regarding the return (reimbursement) of taxes, penalties, fines and interest. The taxpayer may submit these property claims to the court regardless of challenging non-normative legal acts of the tax authorities.
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The rules for calculating interest on the amount of overpayment not returned on time by the tax authority are established by paragraphs. 2.5 tbsp. 6.1, paragraphs. 6, 10, 12 tbsp. 78 Tax Code of the Russian Federation.
The calculation of interest, as well as the refund of overpaid taxes, is done in rubles (Clause 13, Article 78 of the Tax Code of the Russian Federation).
If during the violation of the deadline for returning the overpayment the refinancing rate has changed, then for each period the corresponding rate is valid, interest is calculated separately.
The norm is clause 10 of Art. 78 of the Tax Code of the Russian Federation has not established whether the day of return of the overpayment is included in the calculation of calendar days of delay.
The opinion of the Ministry of Finance of the Russian Federation is contradictory:
The Presidium of the Supreme Arbitration Court of the Russian Federation (Resolution No. 11372/13) is of the view that the rules for calculating interest should be uniform, including for VAT charged for late returns of VAT amounts subject to reimbursement from the budget and other overpaid (collected) taxes.
And they are as follows:
• the period of delay is determined by the actual number of calendar days of delay, taking into account the day of actual receipt of funds by the bank, while in accordance with clause 10 of Art. 78 of the Tax Code of the Russian Federation, interest is accrued for each calendar day of delay (violation of the deadline) for the return of the overpayment;
• calculation is made based on the actual number of days in a year (365 or 366).
In connection with this resolution, the calculation formula contained in clause 3.2.7 of the order of the Federal Tax Service of Russia No. MM-3-1/ [email protected] (order of the Federal Tax Service of Russia No. MMV-7-8/ [ email protected] ).
If the tax authority did not pay the interest or paid it in full, it must pay it in addition (clauses 10, 11, 12 of Article 78 of the Tax Code of the Russian Federation).
The additional payment occurs within 3 days after receipt from the Federal Treasury of a notification about the date of the actual return of the overpayment amount (clause 6, article 6.1, clause 12, article 78 of the Tax Code of the Russian Federation). Next, the inspection makes a decision on the return of interest for the remaining days of delay and sending the order to the Federal Treasury.
A delay in the return of an overpayment of tax, carried out at the request of a taxpayer, entails the payment of interest for the tax authority that allowed such a delay. This interest is calculated on the amount not repaid on time by applying the refinancing rate (key rate) to it, taking into account the actual number of days of delay.
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Procedural deadlines
An application for a refund of overpaid tax with interest accrued on its amount may be submitted to the Federal Tax Service within three years. The procedure for calculating this period depends on the basis for the overpayment.
For example, if a tax is overpaid due to the fault of the payer, the three-year period begins to be calculated from the date of payment of the tax (Clause 7, Article 78 of the Tax Code of the Russian Federation). In the case of forced payment of tax, the period for filing an application is calculated from the day when the taxpayer became aware of the fact of excessive collection of tax from him (clause 3 of Article 79 of the Tax Code of the Russian Federation).
Missing the three-year period does not deprive payers of the right to return the overpayment and interest on it. This period is established only for the return of taxes/interest through the Federal Tax Service without going to court.
Therefore, if the payer has not applied to the inspectorate for a refund of taxes and interest within three years, he may demand their collection in court. In this case, the general rules for calculating the limitation period apply - within three years from the day the person learned or should have learned about the violation of his right (Articles 196 and 200 of the Civil Code of the Russian Federation).
The moment from which the payer must become aware of a violation of his right to a refund of taxes and interest is determined by the courts in different ways. It all depends on the reasons why the taxpayer overpays the tax, as well as on whether the payer has the ability to correctly calculate the tax.
Often, the courts recognize this moment not as the day of payment of the tax, but as the day of receipt of a certificate from the tax authority on the status of settlements with the budget (Resolution of the Administration of the Ural District dated March 14, 2017 No. A76-12783/2016, Resolution of the Administration of the Ural District dated June 17, 2016 No. F09-6580/ 16).
If the payer decides to collect tax and interest by challenging the actions or decisions of the Federal Tax Service (decision to refuse a refund), then the statute of limitations established in clause 4 of Art. 198 Arbitration Procedure Code of the Russian Federation. This period is only three months from the day the taxpayer became aware of a violation of his rights.
Terms and amount of payments after submitting an application
The key point in determining the start date of the delay is the date of submission of the application to the Federal Tax Service for a refund of personal income tax or other tax. The following nuances are taken into account:
- The total duration of the tax service's actions to verify the eligibility of the taxpayer's claims for a tax refund from the budget is one month after receiving the application.
- If the claim is filed on the same day as the declaration, then the consideration period is increased by the period of the desk audit - 3 months for the audit and 1 month for the application.
- The use of a declarative nature for VAT refunds allows you to reduce the waiting period to 12 days; in other cases, a three-month period for document verification is added to this period.
Peculiarity! If the Federal Tax Service meets the deadline, then the amount of the deduction is the amount according to the declaration. Otherwise, for each day of delay you will have to pay an additional 1/365 of the refinancing rate in this period of the total amount of debt.
Pre-trial settlement
Claims for the recovery of interest accrued on the amount of untimely returned/collected taxes are of a property nature. Therefore, these requirements are not subject to the procedure for pre-trial settlement of disputes with tax authorities established by Art. 138 Tax Code of the Russian Federation.
Let us recall that, according to this article, acts of tax authorities of a non-normative nature, actions or inactions of their officials can be appealed in court only after they have been appealed to a higher tax authority.
Therefore, if the payer makes a demand to collect interest from the Federal Tax Service, there is no question of appealing the decisions and actions of the tax authorities. Therefore, there is no need to appeal to a higher tax authority the refusal of the Federal Tax Service to return overpaid tax and interest. It is enough for the payer to file a claim in court to recover the appropriate amounts from the Federal Tax Service.
The Supreme Court of the Russian Federation in its Ruling dated June 20, 2016 No. 304-KG16-3143 directly stated that such judicial methods of protecting the rights of taxpayers as challenging non-normative legal acts of tax authorities and claiming excessively collected tax/interest are independent.
The norms of the Tax Code of the Russian Federation do not contain special requirements for a mandatory pre-trial procedure for resolving disputes regarding the return (reimbursement) of taxes, penalties, fines and interest. The taxpayer may submit these property claims to the court regardless of challenging non-normative legal acts of the tax authorities.
