Payments in court: assessing the tax consequences

Accounting for fines and penalties

ACCOUNTING 2015: reflection of fines and penalties in accounting.

In the accounting of the creditor organization (supplier of goods, performer of work, services), fines and penalties received for violation of the terms of the contract are recognized as other income (clause 7 of the accounting regulations “Income of the organization” (PBU 9/99), approved by order of the Ministry of Finance of Russia dated 06.05 .1999 N 32n). They are taken into account in amounts recognized by the debtor or awarded by the court in the reporting period in which they were actually recognized by the debtor or the court made a decision on collection (clause 10.2 of PBU 9/99). To take into account penalties recognized by the debtor, it is necessary to have documents confirming their recognition and allowing one to determine the amount of the recognized debt. It may be a bilateral act signed by the parties, a letter from the debtor confirming the fact of violation of the obligation, indicating the amount of the recognized penalty, or another similar document.

When taking into account penalties based on a court decision, the following must be taken into account.

Types of existing penalties

Before considering the question of how to post a fine or penalty in accounting, let’s figure out what sanctions of this kind may be. They are divided into two groups:

1. Accrued by counterparties to each other in connection with violation of contractual obligations.
2. Arising in case of non-compliance with tax legislation.

Sanctions of the first group are provided for in the texts of agreements concluded between counterparties as mutual and can equally arise for each of the parties. For example, penalties are usually established for the buyer for late payment, and for the supplier for failure to meet the delivery deadline. More serious sanctions (in the form of a fine) are intended to ensure the fulfillment of obligations that seriously affect the very fact of the functioning of the counterparty or lead to significant losses for it (including due to failure to fulfill obligations to a third party). The amount of sanctions arising between counterparties is indicated in the contract either directly (such as the amount of interest for each day of delay in payment or delivery) or by describing the calculation algorithm.

Situations in which penalties and fines are assessed for violations of tax legislation are given in the Tax Code of the Russian Federation; there are also indications of their specific amounts, and, in necessary cases, calculation algorithms. Here, taxpayers usually become the payers of sanctions, although in a number of cases (for example, a delay in the return of overpaid tax to the budget or the amount of VAT to be refunded), the same kind of responsibility is established for the tax authorities.

Thus, a specific legal entity may turn out to be both a payer and a recipient of payments from both groups, and accounting entries for fines and penalties will arise not only when accounting for expenses on them, but also when reflecting income.

Penalty from the buyer for violating the delivery deadline for wiring and VAT! Help me please!

Decisions of the arbitration court enter into legal force one month after their adoption, unless an appeal has been filed (clause 1 of Article 180 of the Arbitration Procedure Code of the Russian Federation). Consequently, the reflection of penalties for violation of contractual obligations based on a court decision in accounting should occur in the reporting period when a month has passed from the date of the decision of the arbitration court. Amounts of claims (claims) submitted that are not recognized by the payer (not awarded by the court) are not accepted for accounting. Penalties collected from counterparties for non-compliance with contractual obligations, in amounts recognized by payers or awarded by the court, are reflected in the following entries: - debit 76-2 “Settlements on claims” credit 91-1 “Other income”: penalties recognized by the debtor or awarded by the court; — debit 51 credit 76-2: penalties received.

How to reflect the accrual and payment of tax penalties and fines in accounting

The basis for making entries for penalties or fines assessed for payment to the budget are documents with the amounts of these payments issued by the tax authority:

• decisions based on the results of the inspection>;
• requirements for payment of taxes (contributions).

For the taxpayer, they represent an expense that must be reflected on account 99 or account 91, depending on the type of tax.

For which taxes the Ministry of Finance requires penalties and interest to be reflected on account 99, and for which on account 91, find out from the Typical Situation from ConsultantPlus by receiving a free trial access.

The corresponding account for tax sanctions will be account 68, in which both penalties and fines should be allocated for each tax (contribution) in the analytics.

The accrual of sanctions in favor of the tax authorities will thus be reflected by the entry Dt 99 (91) Kt 68, and the entry for payment of fines or penalties will look like this: Dt 68 Kt 51.

If the payer of sanctions against a legal entity turns out to be a tax authority, then the accounting entries in this case will be similar to those used when calculating similar payments arising under contractual relationships with other counterparties:

• Dt 76 Kt 91 - accrual of income under sanctions;
• Dt 51 Kt 76 - receipt of funds for their payment.

The Chart of Accounts does not provide for the attribution of such income to account 99. The use of account 91 in this posting indicates the preference for reflecting tax sanctions paid by the taxpayer through account 91, since this provides a more convenient comparison of income and expenses.

Reflection of penalties in the debtor’s accounting

In the debtor’s accounting, penalties paid (fines, penalties) for violation of contractual obligations are included in other expenses (clause 12 of the accounting regulations “Organization expenses” (PBU 10/99), approved by Order of the Ministry of Finance of Russia dated May 6, 1999 N 33n). Penalties ( fines, penalties ) in accordance with clause 14.2 of PBU 10/99 are accepted for accounting in amounts recognized by the organization or awarded by the court in the reporting period in which the court decision on their collection was made, regardless of the time of actual payment of funds and other forms of implementation . After recognizing (awarding) a penalty, the debtor attributes it to the increase in other expenses. To do this, in the same reporting period, they make an entry for the corresponding amount: - debit 91-2 “Other expenses” credit 76-2: penalties for violation of contractual obligations awarded by the court or recognized by the organization are reflected.

Repayment of debt to the creditor is reflected by the following entry: - debit 76-2 credit 51: penalties for violation of contractual obligations have been paid.

Example of accounting entry for fines and penalties

The seller shipped a consignment of goods to the buyer in the amount of 2,360,000 rubles including VAT. The buyer paid for the goods 9 days late. According to the terms of the agreement, for late payment a fine of 50,000 rubles and a penalty of 0.1% of the unpaid amount for each day of delay are provided. The seller filed a claim for a fine of 50,000 rubles and penalties of 21,240 rubles (2,360,000 rubles x 0.1% x 9). The buyer partially agreed with the claim, expressing his readiness to pay the accrued amount of penalties and a fine in the amount of 5,000 rubles, which he reported in writing on July 24, 2012. This offer was eventually accepted by the seller. In the buyer’s accounting, the above business transactions are accompanied by the following entries: - debit 41 credit 60: 2,360,000 rubles - goods accepted for accounting; - debit 19 credit 60: 360,000 rubles - the amount of VAT presented by the seller of goods is allocated; — debit 60 credit 51: 2,360,000 rubles — funds were transferred for goods; — debit 91-2 credit 76-2: 26,240 rubles (21,240 + 5000) — the supplier’s claim for late payment for goods was recognized; - debit 76-2 credit 51: 26,240 rubles - fines and penalties are listed.

In the seller’s accounting, the shipment of goods and the accrual of penalties are taken into account as follows (without posting to write off the actual cost of shipped goods): - debit 62 credit 90-1: 2,360,000 rubles - the buyer’s debt for shipped goods is reflected; — debit 90-3 credit 68 subaccount “Calculations for VAT”: 360,000 rubles — VAT is charged for shipped goods; - debit 51 credit 62: 2,360,000 rubles - payment received for goods shipped; — debit 76-2 credit 91-1: 26,240 rubles — penalties for violation of the contract in the amount recognized by the buyer are taken into account in other income; - debit 51 credit 76-2: 26,240 rubles - funds have been received against the submitted claim.

If the penalty to be paid is clearly disproportionate to the consequences of the violation of the obligation, then the debtor has the right through the court to demand its reduction.

REFLECTION IN ACCOUNTING OF FINES, PENALTIES, PENALTY UNDER BUSINESS AGREEMENTS OF THE DEBTOR ORGANIZATION

In accounting, fines, penalties, and penalties for violation of contractual obligations are included in non-operating expenses. This is determined by paragraph 12 of Order of the Ministry of Finance of the Russian Federation dated May 6, 1999 No. 33n “On approval of the accounting regulations for “organizational expenses” PBU 10/99” (hereinafter referred to as PBU 10/99).

In accordance with clause 14.2 of PBU 10/99, fines, penalties, penalties are accepted for accounting in the amounts awarded by the court in the reporting period in which the court made a decision on their collection.

In accordance with the Chart of Accounts and the Instructions for its application, approved by Order of the Ministry of Finance of the Russian Federation dated October 31, 2000 No. 94n, in accounting for the reflection of fines, penalties, penalties, account 91 “Other income and expenses” is intended, subaccount 91-2 “Other expenses » in correspondence with accounts for settlements or cash.

Example 1.

The Vega organization shipped a consignment of goods to the Delta organization in the amount of 236,000 rubles (excluding VAT). According to the terms of the agreement, for late payment for goods, a fine of 50,000 rubles and a penalty of 0.1% for each day of delay are provided. The Delta organization did not make the payment on time, thereby violating the terms of the contract. The Vega organization filed a claim for a fine in the amount of 50,000 rubles and penalties in the amount of 3,200 rubles. The Delta organization agreed with the claim made against them.

TAXATION OF FINES, PENALTY, PENALTY UNDER BUSINESS CONTRACTS FOR THE DEBTOR ORGANIZATION

INCOME TAX

For the purpose of calculating income tax, the amount of the fine payable is taken into account as part of non-operating expenses not related to production and sales, in accordance with subparagraph 13 of paragraph 1 of Article 265 of the Tax Code of the Russian Federation (hereinafter referred to as the Tax Code of the Russian Federation).

The date of recognition of expenses in the form of a fine, penalty, or penalty for a taxpayer who determines income and expenses using the accrual method is the date the organization recognizes the fine. This follows from subparagraph 8 of paragraph 7 of Article 272 of the Tax Code of the Russian Federation:

“the date of recognition by the debtor or the date of entry into legal force of the court decision - for expenses in the form of amounts of fines, penalties and (or) other sanctions for violation of contractual or debt obligations, as well as in the form of amounts of compensation for losses (damage).”

For organizations that determine income and expenses on a cash basis, expenses in the form of fines, penalties and (or) other sanctions for profit tax purposes are recognized after their actual payment (clause 3 of Article 273 of the Tax Code of the Russian Federation).

Please note that in order to recognize fines, penalties, penalties as part of non-operating expenses, a document is required that confirms the fact of violation of contractual obligations by the debtor. That is, the requirement of Article 252 of the Tax Code of the Russian Federation must be met, expenses must be justified and documented.

VALUE ADDED TAX

Penalties are calculated based on the terms of the contract, or at the written request of the creditor, or by court decision. Do I need to issue an invoice for the amount of the penalty? In accordance with paragraph 1 of Article 168 of the Tax Code of the Russian Federation, when selling goods (work, services), the supplier issues the corresponding invoices to the buyer. But if a penalty is accrued, no shipment of goods, performance of work, or provision of services occurs, therefore, the supplier does not issue an invoice for the amount of penalties.

Please note that the payer of the penalty (buyer), calculated on the amount of the penalty, does not have the right to deduct VAT. Since Article 171 of the Tax Code of the Russian Federation does not provide for the possibility of accepting a tax deduction for VAT on this basis.

According to paragraph 2 of Article 171 of the Tax Code of the Russian Federation, tax amounts presented to an organization for goods, work, services, property rights acquired for the implementation of transactions recognized as objects of taxation and for goods (work, services) acquired for resale are subject to deduction.

As we can see, the organization has no grounds to offset the tax paid against penalties.

A similar point of view is reflected in the letter of the Ministry of Taxes and Taxes of the Russian Federation dated April 27, 2004 No. 03-1-08/1087/14.

Therefore, the organization attributes the total amount of sanctions, together with the tax, to non-operating expenses in its accounting as of the date of the letter of agreement to pay the sanctions under the contract.

For profit tax purposes, the organization takes into account the amounts on the claim without VAT, since all cases when VAT can be taken into account in expenses are listed in Article 170 of the Tax Code of the Russian Federation (Appendix No. 4).

Example 2.

The Vega organization shipped products to the Delta LLC organization in the amount of 295,000 rubles (including VAT 45,000 rubles).

What kind of wiring should be used to reflect a fine for violating sanitary rules and regulations?

Quote (Citizen Shilova): Hello! Good afternoon Dt 99 Kt 68 Good afternoon. Methodologists and auditors recommend administrative (non-tax) fines specifically for 91 accounts. Here are examples in the article. : Advice added on April 7, 2012 How to reflect fines in accounting The financial and economic activities of enterprises are not always conducted without flaws. From time to time, organizations violate the terms of contracts with partners, miss deadlines for submitting reports, do not comply with the instructions of various government bodies and, as a result, pay fines. When reflecting them in accounting, it is necessary to take into account certain nuances. Instruction 1 Fines can be divided into 2 groups: civil and administrative. The first includes sanctions for violation of contractual obligations, and the second includes a large array of fines collected by government bodies and institutions: the Federal Tax Service, extra-budgetary funds, traffic police, Rospotrebnadzor, etc. 2 Accounting for fines for violation of contract terms in accordance with PBU 10/ 99 “Expenses of the organization” is maintained according to the accounts of debtors and creditors. Penalties recognized by the debtor or established by a court decision are included in the financial results of the enterprise as other expenses. To reflect them, use the following entries in accounts 76-2 “Calculations for claims”, 91-2 “Other expenses”, 51 “Current account”: Dt 91-2 Kt 76-2 - debt to pay fines is taken into account; Dt 76-2 Kt 51 – payment of a fine is taken into account. 3 In accordance with Article 265 of the Tax Code of the Russian Federation, expenses in the form of fines recognized by the debtor or established by a court decision are included in non-operating expenses and reduce taxable profit. 4 The basis for accounting for tax sanctions and fines imposed by other government bodies is the decision to impose administrative liability, as well as a payment or collection order to pay the amount of the fine. Accounting entries are generated according to accounts 68 “Calculations for taxes and fees”, 69 “Calculations for social insurance”, 76 “Settlements with various debtors and creditors”, 99 “Profits and losses”, 51 “Current account”. 5 To reflect the sanctions of tax and other authorities in accounting, perform the following operations: Dt 99 Kt 68 (69, 76) - debt to pay fines is taken into account; Dt 68 (69, 76) Kt 51 - payment of a fine is taken into account. 6 According to PBU 18/02 “Accounting for income tax calculations”, the amounts of administrative fines do not participate in the formation of the accounting profit indicator. Therefore, do not include these expenses in the income tax base and write them off at the end of the year against net profit. source website Kakprosto Reflection of an administrative fine in accounting The Accounting Regulations “Expenses of an Organization” PBU 10/99 does not directly indicate which expenses include the costs of paying fines for administrative offenses. Obviously, they do not meet the criteria for expenses for ordinary activities. Therefore, it is advisable to take these expenses into account as part of other expenses on the basis of clause 12 of PBU 10/99. In accordance with the Instructions for the application of the chart of accounts for accounting financial and economic activities of organizations, approved by order of the Ministry of Finance of Russia dated October 31, 2000 N 94n (hereinafter referred to as the Instructions), account 99 “Profits and losses” during the reporting year reflects: - profit or loss from ordinary activities - in correspondence with account 90 “Sales”; - balance of other income and expenses for the reporting month - in correspondence with account 91 “Other income and expenses”; - the amount of accrued conditional income tax expense, permanent liabilities and payments for recalculation of this tax from actual profit, as well as the amount of tax penalties due - in correspondence with account 68 “Calculations for taxes and fees”. That is, in accordance with the Instructions, the list of expenses reflected in account 99 is closed. As can be seen from the list, account 99 includes the amounts of only tax sanctions. At the same time, the Instructions provide that account 91 “Other income and expenses” is intended to summarize information on other income and expenses of the reporting period. We believe that in this case, the payment of the administrative fine should be reflected in the accounts as follows: Debit 91, subaccount “Other expenses” Credit 76, subaccount “Settlements on claims” - an administrative fine has been charged; Debit 76, subaccount “Calculations for claims” Credit 51 - an administrative fine was paid. Let us recall that since this type of expense is not taken into account when taxing profits, a permanent tax liability will arise in accounting, which must be reflected by posting (clause 7 of PBU 18/02 “Accounting for calculations of corporate income tax”): Debit 99 Credit 68 , subaccount “Calculations for income tax”. The answer was prepared by: Expert of the Legal Consulting Service GARANT, professional accountant Molchanov Valery Quality control of the answer: Reviewer of the Legal Consulting Service GARANT, professional accountant Rodyushkin Sergey October 31, 2012 If you follow the instructions for using the chart of accounts, then tax sanctions are taken into account on account 99, administrative sanctions are not included there Not a word was said.

The company may be fined by the tax authorities, for example, for late submission of reports. Counterparties may impose fines for violating the terms of contracts. The opposite may also happen - the organization itself will receive monetary compensation from a supplier who did not ship the goods on time. Accounting for sanctions in each specific case has its own characteristics. Let's look at them in more detail.

Accounting and tax accounting of fines for violation of contractual obligations

In accordance with the agreement, Delta LLC must pay for the products received within 15 days. For each day of delay, Delta LLC must pay a penalty in the amount of 0.5% of the cost of the products under the contract. Delta LLC delayed payment by 10 days. A claim was made to the organization. In response to the submitted claim, Delta LLC agreed to pay a penalty based on the terms of the contract.

For profit tax purposes, Delta LLC will take into account only 14,750 rubles. The organization will not be able to take into account the amount of accrued VAT on the penalty in the amount of 2,655 rubles in expenses, since this case is not mentioned in Article 170 of the Tax Code of the Russian Federation.

You can find out more about the issues of payment of fines, penalties and penalties under business contracts in the book of JSC “BKR-Intercom-Audit” “”.

This material was prepared by a group of methodological consultants

Typical entries for the accrual and payment of fines and penalties for taxes

Sources

• https://nalog-nalog.ru/buhgalterskij_uchet/vedenie_buhgalterskogo_ucheta/buhgalterskie-provodki-po-shtrafam-i-penyam/
• https://nalog-nalog.ru/otvetstvennost/nalogovaya_otvetstvennost/nalogovyj_uchet_neustojki_za_narushenie_uslovij_dogovora/
• https://www.calc.ru/Shtraf-Po-Nds.html
• https://nalog-nalog.ru/nds/uplata_nds/kakaya_otvetstvennost_za_nesvoevremennuyu_uplatu_nds/
• https://azbuha.ru/buxgalterskij-uchet/peni-i-shtrafy-v-nalogovom-uchete/
• https://ruadvocate.ru/vidy-prestuplenij/otvetstvennost-i-shtraf-za-nesvoevremennuyu-uplatu-nds/
• https://BuhSpravka46.ru/buhgalterskie-provodki/provodki-pri-nachislenii-shtrafov-i-peni-po-nalogam.html

Concept, essence and reflection of penalties in accounting, postings

First of all, let's look at the definition. A penalty is a type of penalty, which is determined for failure to fulfill or improper fulfillment by participants in legal relations of their obligations under contracts and other civil legal acts. This includes fines and penalties.

Such a material sanction is other income for the receiving participant (clause 7 of PBU 9/99) and other expenses for the obligated participant (clause 11 of PBU 10/99).

The account on which the main accounting actions for accounting for sanctions are reflected is 76 “Settlements with various debtors and creditors.”

Penalty: concept, types, collection rules

By concluding a business agreement on cooperation, each partner expects that its counterparty will fulfill its obligations efficiently and on time. Unfortunately, this does not always happen. The legislation of the Russian Federation provides for several ways to ensure the implementation of business agreements (Article 329 of the Civil Code of the Russian Federation). One of them is a penalty (Article 330 of the Civil Code of the Russian Federation), which can be in the form of:

• A fine is a fixed amount collected for non-compliance with the terms of the business agreement by one of the partners. However, the duration of the violation is not important here. The fine can be set not only as a fixed amount, but also as a percentage.
• Penalty accrued continuously until the breached obligations are fulfilled. In order to ensure this continuity, it is necessary to fix the period for which the penalty is calculated. Otherwise, it will not be difficult to later re-qualify it as a one-time fine, which can be extremely disadvantageous for the creditor.

Read about the relationship between the concepts of “fine” and “forfeit” in the article “ Fine and forfeit - what is the difference?” .

This publication will tell you what grounds there are for reducing the penalty.

If you have access to ConsultantPlus, check whether you have correctly reflected the costs of fines and penalties under contracts in tax accounting when determining the amount of profit. If you don't have access, get a free trial of online legal access.

A penalty can be applied to non-compliance with a variety of terms of a business agreement: late payment or delivery, low-quality goods, etc. Moreover, it is possible to simultaneously prescribe both sanction measures in the contract: a fine and penalties (determination of the Supreme Arbitration Court of the Russian Federation dated February 15, 2013 No. VAS-800/ 13).

IMPORTANT! The agreement on penalties must be drawn up in writing, regardless of the form in which the violated business agreement was concluded. Otherwise, it will be impossible to collect it (Article 331 of the Civil Code of the Russian Federation). In this case, it is possible to draw up both an additional agreement and introduce provisions on penalties into the main agreement. In the agreement, indicate for which violation it is provided (Resolution of the Federal Antimonopoly Service of the Volga-Vyatka District dated September 4, 2012 No. A31-11425/2011).

See a sample of such an agreement here.

Calculation of fines: postings

It is better for both the guilty party and the party receiving the income to use a separate subaccount for accounting for penalties, fines and other penalties under civil contracts - 76.2. The amounts of such sanctions are taken into account in the amount established by the court and in the reporting period to which the court decision is dated (clause 14.2 of PBU 10/99). According to clause 76 of the regulations under Order of the Ministry of Finance of Russia dated July 29, 1998 No. 34n, the receiving and obligated parties must reflect penalty payments in accounting until actual mutual settlements are made.

Displaying tax penalties in accounting

To display the costs incurred that arise when fines and penalties are calculated, account 99 Profit and loss is used. For convenience, it is divided into two subcontos - penalties and fines. The debit of this account corresponds with the corresponding tax payment, which is displayed on the credit of accounts 68 and 69.

There are opinions in accounting circles that account 91 Other expenses can also be used to display accrued penalties and fines. However, in this case, a permanent tax liability arises, which somewhat complicates the process of accounting for them.

In addition, if accrued penalties and fines are displayed on 91 accounts, this will lead to a decrease in the tax base and will violate the authenticity of the information provided in the financial indicators of the organization.

Important! Penalties and fines recognized in accounting are not reflected in tax accounting, and therefore will not reduce your tax liability in any way.

Penalty: entries for accounting

Let's look at how to reflect the accrual of penalties in accounting; entries will be presented for both the obligated party and the party receiving the income (for non-profit organizations).

If a penalty must be sent to an individual (under a civil law agreement and other civil legal acts), then the sequence of accounting actions will be as follows:

• Dt 76.2 Kt 50 - payment of a penalty to an individual who is not an individual entrepreneur in cash;
• Dt 76.2 Kt 68 - accrual of personal income tax for the sanction;
• Dt 68 Kt 51 - payment of personal income tax;
• Dt 91.2 Kt 69 - calculation of insurance premiums for the amount of recovery (clause 1, clause 1, article 420 of the Tax Code of the Russian Federation);
• Dt 69 Kt 51 - payment of insurance premiums.

If compensation under an employment contract is accrued within the framework of the standard established by Art. 236 of the Labor Code of the Russian Federation, then it is not subject to personal income tax (clause 3 of Article 217 of the Tax Code of the Russian Federation, Letter of the Ministry of Finance No. 03-04-05/11096 dated 02/28/2017). Moreover, if in a labor or collective agreement such a standard is specified in an amount higher than that determined by labor legislation, then personal income tax will also not be charged for collection.

Types of fines

The nature of contractual relationships with service providers, counterparties and regulatory authorities determines the different types of penalties applied to the debtor.

Penalty under an agreement with a counterparty is calculated in the following cases:

• Late payment for work performed, services provided, goods sold;
• Violation of the terms specified in the contract for the delivery of goods, provision of services or completion of work.

If it is not possible to reach an agreement with the debtor who refuses to pay the penalty, the debt can be collected through the court. This is a completely standard procedure, and for an experienced specialist it does not pose any difficulty. Remote accounting services are one of the options for collecting debts, penalties, and fines from debtors.

Tax authorities severely fine for late filing of returns, regardless of the length of the delay. A one-day delay in documentation is not a mitigating circumstance: the company will receive a tax notice about the fine imposed, separately about penalties, plus a court ruling.

Penalties against a legal entity are also included in a number of other cases. Thus, if violations in record keeping, deliberate distortion of financial results, incorrect calculation of insurance premiums and tax amounts are detected, the violator will face a fine. The amounts are reflected in the debit – credit of accounts 99 – 68 (69).

Accounting with the winning party

Let's consider how a company that wins in court reflects the amounts received in tax accounting.

Income tax

As we said earlier, from the point of view of civil law, the concept of “penalty” includes such contractual sanctions as fines and penalties. In paragraph 3 of Art. 250 of the Tax Code of the Russian Federation states that non-operating income includes fines, penalties and (or) other sanctions for violation of contractual obligations payable by the debtor on the basis of a court decision that has entered into legal force, as well as amounts of compensation for losses or damages.

Thus, the penalty is included in non-operating income on the basis of clause 3 of Art. 250 Tax Code of the Russian Federation. This is confirmed by the Ministry of Finance of Russia in letter dated December 17, 2013 No. 03-03-10/55534 (brought to the attention of the tax authorities by letter of the Federal Tax Service of Russia dated January 10, 2014 No. GD-4-3/ [email protected] and posted on the official website of the Federal Tax Service of Russia ).

The date of recognition of the income in question is established in subparagraph. 4 p. 4 art. 271 Tax Code of the Russian Federation. It is recognized as the day the court decision comes into force.

Similarly, the amounts of state fees and legal costs reimbursed on the basis of a court decision are taken into account (letter of the Ministry of Finance of Russia dated July 24, 2013 No. 03-03-05/29184).

VAT

In accordance with sub. 2 p. 1 art. 162 of the Tax Code of the Russian Federation, the VAT tax base is increased by amounts received for goods (work, services) sold in the form of financial assistance, to replenish special-purpose funds, to increase income, or otherwise related to payment for goods (work, services) sold.

According to officials, the penalty does not apply to such amounts. In the letter of the Ministry of Finance of Russia dated 04.03.2013 No. 03-07-15/6333 (brought to the attention of the tax authorities by letter of the Federal Tax Service of Russia dated 03.04.2013 No. ED‑4-3/ [email protected] and posted on the official website of the Federal Tax Service of Russia) it is explained, that when deciding on the imposition of VAT penalties, one should be guided by the Resolution of the Presidium of the Supreme Arbitration Court of the Russian Federation dated 02/05/2008 No. 11144/07. It states that the amounts of penalties as liability for late fulfillment of obligations received by the company from the counterparty under the contract are not related to payment for the goods and therefore are not subject to VAT.

The fact that the amount of the penalty is not subject to VAT was once again confirmed by the Russian Ministry of Finance in letter No. 03-07-11/33051 dated 06/08/2015.

Interest for the use of other people's funds, as well as penalties, are a measure of liability for late fulfillment of obligations. Therefore, they should not be subject to VAT either. The courts confirm this (decrees of the Federal Antimonopoly Service of the Moscow District dated December 1, 2011 in case No. A40-33299/11-140-146, dated November 13, 2008 No. KA-A40/10586-08 in case No. A41-3502/08).

Compensation for losses (including lost profits) is also not subject to VAT. Such an operation does not apply to implementation (resolution of the Federal Antimonopoly Service of the Moscow District dated July 4, 2013 in case No. A40-123538/12-140-783 (Decision of the Supreme Arbitration Court of the Russian Federation dated September 12, 2013 No. VAS-12148/13 refused to transfer the case for review)).

There is no need to impose VAT and compensation for legal costs. After all, it is not the sale of goods (works, services) and is not related to their payment.

simplified tax system

According to paragraph 1 of Art. 346.15 of the Tax Code of the Russian Federation, persons applying the simplified tax system take into account income from sales and non-operating income, determined accordingly in accordance with Art. 249 and 250 of the Tax Code of the Russian Federation.

As we have already indicated above, the amounts of penalties, compensation for losses and legal expenses, interest for the use of other people's funds are classified as non-operating income on the basis of clause 3 of Art. 250 Tax Code of the Russian Federation. Thus, if the winning party applies the simplified tax system, it includes the amounts received as taxable income. The date of receipt of such income will be the day of actual receipt of funds, since in the simplified system income recognition is carried out using the cash method (clause 1 of Article 346.17 of the Tax Code of the Russian Federation). The Russian Ministry of Finance confirms this (letter dated May 12, 2014 No. 03-11-06/2/22114).