Entrepreneurs of Russia can count on tangible volumes of state support for their activities in the form of subsidies. Based on what criteria do authorities determine businesses for which assistance can be provided?
Do business get subsidies?
Yes. Subsidies for small businesses, and especially for start-ups, in Russia can be provided both at the state and municipal levels. At the same time, the structure of the respective programs can vary greatly from one region to another. It all depends mainly on the budget resources of a particular subject of the federation or the municipality. Financial mechanisms at the national level aimed at direct subsidization of small businesses have not yet been developed, despite the existence of a federal business support program. However, there are scenarios involving the reimbursement of regional budget expenditures related to the provision of appropriate support measures to entrepreneurs. Therefore, the federal authorities - mainly the Ministry of Economic Development - although indirectly, still participate in subsidizing the business.
Financial Support Options
Depending on the specific regional program, various types of subsidies can be determined. For example, in Moscow there are several basic formats for supporting businesses. For example, in Moscow there are programs adapted for subsidizing entrepreneurial initiatives for citizens who are not officially employed. As part of this kind of support measure, the amount of state aid is relatively small - about 60 thousand rubles. In some cases, the city authorities are ready to compensate for the costs of businesses associated with the registration of enterprises - in this case, the owners of firms can receive assistance of about 25 thousand rubles.
At the same time, Moscow also envisages larger-scale volumes of financing of entrepreneurial initiatives. Help in the amount of 500 thousand rubles as a subsidy to support small businesses can get entrepreneurs planning to purchase fixed assets, supply the necessary resources for jobs, purchase software or rent an office. Within the framework of certain items of expenses, compensation of costs in the amount of 100% is possible, but the option with partial reimbursement is also practiced.
It is noteworthy that taxation of subsidies for small businesses is not provided. This is a big plus for entrepreneurs, who in many cases experience an already high load in terms of various fees and payments to the state treasury.
Loan Compensation
In some cases, subsidies for small businesses are expressed in compensation for part of the costs of servicing bank loans. As a rule, this is a reimbursement of costs associated with the repayment of loans in terms of interest. Compensation of this kind is provided in the form of the difference between the amount of interest payable under an agreement with the bank and the amount of the contribution indicated in the business plan.
The maximum amount of compensation in question is in many cases tied to the refinancing rate of the Central Bank of the Russian Federation. If the loan repayment term is more than three years, then 2/3 of the Central Bank refinancing rate is compensated. If 2-3 years - then 1/2. If less than two years, then 1/3. These figures appear in Moscow business assistance programs.
Surety Assistance
Subsidies for small businesses can also be provided in order to fulfill obligations related to the guarantee, as well as bank guarantees. True, the amount of appropriate compensation cannot exceed 90% of the estimated expenses of the entrepreneur.
Compensation of licenses and certificates
In many cases, a business requires a special kind of license and certificate. For example, quite often such documents are needed for food industry enterprises. State subsidies for small businesses in this direction can be presented in the form of compensation for expenses associated with the preparation of the necessary sources (as a rule, this means payment for the services of intermediary organizations). The maximum amount of compensation in most cases does not exceed 50%. The amounts in question, however, may be material. In Moscow business assistance programs this is about 400 thousand rubles.
Lease Compensation
Quite often, enterprises acquire equipment and other resources on lease. In respect of costs associated with this line of business, government subsidies may also apply. As a rule, the limit amount of compensation here, as well as in the case, for example, with the payment of a loan, is tied to the Central Bank refinancing rate. In some cases, there may be a restriction in the period for which subsidies are accrued. For example, under one of the Moscow entrepreneurs' support programs, compensation for leasing is paid, regardless of the duration of the contract between the business and the car supplier, for three years.
The amounts that can be discussed when calculating subsidies for leasing can be significant. For example, in a number of metropolitan business support programs this is 5 million rubles. True, this does not compensate for more than 30% of the entrepreneur’s expenses for paying leasing contracts. At the same time, the VAT can also be taken into account in the “formula” - 18%. In this case, the actual assistance from the state will be slightly less, but the VAT, based on some specifics of taxation, entrepreneurs can subsequently return or offset against other obligations to the treasury.
Terms & Conditions
Based on what criteria are subsidies for small businesses assigned? Everything, again, depends on the policies of a particular region. But, if you try to summarize the relevant criteria, you can still identify some common requirements for enterprises. For example, in many regions, the basic condition under which it is possible to receive subsidies for small businesses - the period of operation of the organization at the time of applying for support should be no more than 2 years. Also among the frequently encountered conditions - the number of employees should not exceed 250 people. Another criterion used in many regions is revenue. For example, for Moscow this is 1 billion rubles a year.
In most cases, an enterprise that needs a subsidy for small business development should not have outstanding obligations to the Federal Tax Service and extra-budgetary funds. As a rule, the provision of state and municipal support implies that the business will have some volume of its own financial resources. In most cases, this is at least 50% of the total target funding.
Based on what other requirements is it possible to receive subsidies for small businesses? Once again, the relevant rules vary from one region to another. Consider the options with the requirements that are determined by the Moscow authorities.
The laws of the capital regulating subsidizing small businesses, first of all, are prescribed to organizations that apply for support measures, registration with the tax authorities of Moscow.
The next requirement is that businesses should not have separate structural units outside the capital. If there are any, then they should provide revenues to the budget of Moscow in the amount of at least 50% of all taxes paid for the year.
If we are talking about the entrepreneur’s desire, for example, to receive compensation for leasing, then the corresponding contract with the supplier must be concluded no earlier than January 1 of the year in which the company applied for subsidies. Also a prerequisite, when it comes to leasing, is the actual presence of fixed assets at the organization’s facilities, that is, the use of the subject of compensation in real production. Machines and equipment must be in operation.
In some cases, a subsidy is possible only if the Moscow authorities did not provide the entrepreneur with similar measures to support the business. That is, for example, if we are talking about the same leasing - the appropriate compensation is provided in a targeted manner for a particular financial year.
Often, subsidies are accrued only if the entrepreneur can confirm the relevant costs. For example, in the case of leasing, it should be payments in accordance with the schedule that is prescribed in the contract with the supplier.
When the subsidy is not given
What subsidies for small businesses exist, we have studied. Let us now consider the aspect relating to cases where appropriate measures of state or municipal support to the enterprise cannot be provided. Once again, the policies of different regions may vary. In what cases can an entrepreneur not expect to receive a subsidy for starting a small business or to compensate for expenses on a loan, leasing and other types of costs? For Moscow entrepreneurship support programs, the following norms are characteristic.
One of the key business barriers to receiving subsidies, we have already noted above is the presence of debts on taxes and other payments to the treasury. Corresponding obligations must be fulfilled by the enterprise at the time of application for state support.
The company will not be provided with subsidies if bankruptcy or liquidation processes are initiated against it, as well as the suspension of business due to legislative requirements.
The entrepreneur will be denied subsidies if he previously received it, but fulfilled the conditions regarding its use, in violation. True, for some business support programs, a period is established during which such actions are canceled - this is three years.
At the time of application, the entrepreneur must fulfill all previous agreements with the Moscow Government regarding the provision and use of the type of subsidies that are currently being requested.
How is the subsidy assigned?
What are the procedures for granting subsidies? The appropriate decision is made by the authority - local or regional, which is responsible for work in the direction of helping businesses. As a rule, in order to decide on the selection of businesses that meet the criteria, the list of those to whom the subsidy will be assigned. As soon as the relevant procedures are carried out, in the period, which, according to the standards adopted by the metropolitan authorities, is 25 days, contracts are concluded with the selected entrepreneurs. Within the terms established by the agreement, financial compensations are transferred to the settlement accounts of businesses.
Documents
In order to decide on helping a commercial company, the authorities must understand that the business plan for the subsidy, as well as all the necessary documents from the entrepreneur, is in order. What kind of paper does a company that counts on state assistance should provide to the authority responsible for the direction of the work in question? For a change, we can consider the list of documents established for entrepreneurs according to one of the programs adopted in the Irkutsk region.
First of all, businessmen must fill out an application for appropriate assistance in accordance with the approved form.
The next most important document is the same business plan for obtaining subsidies. It should reflect the expected sources of revenue, business costs, payback, market analysis, etc.
Also, the entrepreneur must provide a cost estimate to the competent authority (the Irkutsk authorities also developed a special form for this). Copies of relevant primary documents should be attached to it.
If the activities of the enterprise require licensing or certification, it is necessary to prepare copies of the relevant authorization sources.
Next is a register of estimated expenses completed in the approved form. If we are talking about a program providing for the compensation of existing costs, you need to attach documents confirming the payment of the relevant supplies or services.
The next group of documents is certificates and other documentary sources confirming that the company has no debts to the Federal Tax Service and extra-budgetary funds. All these documents must be fresh, ordered no earlier than 30 days before the application.
If under the law the company needs to keep a balance sheet and a profit and loss account, then the relevant documents must also be submitted to the commission making decisions on subsidies.
Also among the sources necessary for the authorities is an extract from the Unified State Register of Legal Entities, as well as copies certified by a notary public, certificate of registration of a legal entity or individual entrepreneur, as well as a tax registration document.
As we can see, not only a business plan is needed to receive subsidies. The entrepreneur will have to try to collect a sufficiently large number of additional documents.
Industries
In what segments of the economy should entrepreneurs be employed in order to rely on subsidies for small businesses? According to some experts, state bodies and municipalities are most willing to provide support to companies operating in the innovation sector, forming an industrial unit, carrying out activities in medicine, pharmaceutical industry, implementing research projects with prospects for the commercial implementation of developments.
With regard to the regional aspect - the existing business assistance programs are present in very many regions of the federation. For example, in a city like Perm, 245 enterprises received subsidies for small businesses under one of the programs in 2011 (based on the results of a three-year program). The regional budget for the provision of appropriate support measures spent about 19.7 million rubles. That is, the authorities as a whole promote entrepreneurial initiatives - the work does not come down to formalities.