Most of the income of individuals in Russia is subject to personal income tax. For example, this tax is withheld from the salary of an employee, income from entrepreneurial activity, and other sources of income. But there are incomes from which this fee is not charged. You can find out if an old-age pension is taxed from this article.
Personal income tax when calculating a pension payment
According to paragraph 2 of Article 217 of the Tax Code of the Russian Federation, pension payments are not taxed on personal income. But there are exceptions. If voluntary contributions were made for a funded pension to a non-state pension fund (non-state pension fund), then in some cases the pension payment is taxable. Relatively speaking, a “private pension” may be subject to personal income tax.
Tax on working pensioners
This category of people, such as working pensioners, receives wages and pension payments at the same time. Is a pension taxed in this case? The rules that apply to working retirees are as follows:
- An old-age insurance pension is exempt from taxation.
- Official salaries are taxed at the standard rate.
Although working pensioners have to pay taxes, you can find your own advantages in this. For example, senior citizens are entitled to the following tax deductions:
- In accordance with Art. 218 of the Tax Code of the Russian Federation, persons with disabilities, veterans, persons affected by radiation disasters, parents and guardians are given a standard deduction.
- According to Art. 219 of the Tax Code of the Russian Federation, a social deduction is provided for donations, medical services, training, contributions for funded pension payments.
- Art. 219.1 of the Tax Code provides for the possibility of an investment deduction when receiving money from the sale of the Central Bank.
- Based on Art. 220 of the Tax Code of the Russian Federation, property deduction is provided for the sale or acquisition of real estate (apartments, land, houses, mortgages and related expenses).
- Art. 221 N of the Russian Federation involves obtaining a professional deduction, that is, for conducting any professional activity that is a source of income.
Calculation of the pension of a working pensioner
In addition to personal income tax, contributions to the Pension Fund are paid from wages, the amount of which is 22%. Thanks to this, the pension of a working pensioner is recounted annually and increases by the number of points that have been accrued over the past period. But a pensioner can receive a maximum of 3 points per year (while a young person - 10 points). If he earned more, then the remaining points go to the next year, and so on. Recalculation is carried out on the first of August and is based on the application of the following formula - Pu = PDP + IPC * Sipk, where:
- Pu - the size of the pension after the increase.
- PDP - the amount of the pension before recalculation.
- IPK - an individual pension coefficient for the last year of work.
- Sipk - the cost of the coefficient, which is valid during the allocation period. In 2018, it is 81.49 rubles, and in 2019 it will be equal to 87.24 rubles.
Retirement benefit tax
The question of whether a pension is subject to income tax in Russia, if an agreement is concluded with an NPF, depends on the specific circumstances. In some cases, you will have to pay income tax on received pension payments. But direct contributions to NPFs are not taxed. This issue is governed by the following provisions:
- Art. 219.1 of the Tax Code.
- By the letter of the Ministry of Finance No. 03-04-05 / 8-1158.
Is a pension taxed if a contract was concluded between a citizen and a fund in favor of a third person? The answer in this case is positive. Together with this obligation, the pensioner will have the right to file a tax deduction, if there are appropriate grounds for this.
Is a pension taxed if an employer has entered into an agreement with a non-state pension fund? Such cases are found mainly in large companies. Often, NPFs are foundations that are subsidiaries of the enterprise where the future pensioner works. In this situation, the funded pension will also be tax deductible.
But the citizen does not need to worry about paying the necessary funds to the Federal Tax Service. This will be done by NPFs.
Special categories of citizens
It is no secret to anyone that the military and the Ministry of Internal Affairs are on a special account with the state. In addition to the standard old-age insurance pension, they are paid a state long service benefit. Is the pension of the Ministry of Internal Affairs and the Ministry of Defense taxed for seniority? The answer to this question can be found in Art. 217 of the Tax Code. In accordance with it, payments on state pensions along with insurance pensions are exempt from income tax from individuals. Consequently, the pension payment to former military personnel and employees of the Ministry of Internal Affairs is not subject to taxation.
Tax benefits
Regardless of whether the pension is taxed in Russia and whether working pensioners are personal income tax payers (which is withheld from wages), they are recognized as one of the socially vulnerable groups of the population. Therefore, the state provides them with various measures of social support. In particular, older people are entitled to the following tax benefits:
- According to Art. 407 of the Republic of Kazakhstan, pensioners do not pay property tax for an object of each category of real estate, namely: a cottage, a garage, an apartment, etc. Moreover, the property must necessarily belong to the pensioner by the right of ownership and not be used for entrepreneurial purposes.
- The deduction can only be used by those citizens who pay personal income tax (regardless of whether the pension is taxed or wages).
- Regional authorities provide citizens with a transport tax. In the regions, different conditions are provided for citizens. But basically, owners of vehicles with a capacity not exceeding 100-150 liters are exempt from paying it. from.
- Land tax is also provided at the regional level. Usually they are not completely exempted from the tax, but a reduced rate applies to certain categories of pensioners.
Tax incentives are not set automatically. To get them, you must file an application with the tax authority at the place of residence. In addition to the application, you must provide:
- Identification.
- Pensioner's ID.
- Documents proving the fact that an object of immovable or movable (car) property belongs to a pensioner under the right of ownership.
Holding
Achieving retirement age and reaching a well-deserved rest or the onset of disability does not mean exemption of a citizen from obligations under writ of execution, agreements and other similar documents. Is disability pension (old age) taxed or not? In order to ensure the fulfillment of obligations, deductions from pension payments are made. The situations in this case may be as follows:
- Transfer of excess pension amounts. At the same time, the FIU appoints deductions up to the full repayment of previously overpaid money.
- Court orders issued by the judiciary.
- Alimony, loans and other agreements.
The amount of deductions is strictly regulated and cannot be higher than the established percentage relations, namely:
- 20% if excess pension payments were accrued.
- 50% if payment is made according to an executive document.
- 70%, with deduction of alimony, compensation for harm to health (death), for damage caused as a result of committing a crime.
Retention Amount Reduction
Despite the maximum retirement benefit established by law, in some cases the amount may be reduced. Such a decision is made if the pensioner’s financial situation worsened, health problems arose and it became necessary to use paid medical services.
To do this, you need to contact the organization that initiated the deduction from the pension payment, that is, the FIU, the court or a credit institution. Along with the application, documentary evidence of the basis for reducing retirement must be provided.
Retirement Benefit Retirement: An Example
The following example will help you understand how funds are held for retirement obligations. A. Ivanov, monthly, made utility bills in the amount of 4,000 rubles. At some point, the amount was reduced by 1 thousand rubles. and began to amount to 3,000 rubles. Ivanov did not pay attention to this and continued to pay the amounts indicated on the receipt.
Six months later, the management company discovered an error and notified Ivanova A.A. about this, demanding payment of the resulting debt. However, the pensioner refused to do this. Then the representatives of the Criminal Code appealed to the court demanding that Ivanov pay 6,000 rubles. debt. The court made a positive decision in the case and ordered Ivanov to pay monthly 20% of the amount of the pension payment until the debt is paid off.
The pension of A. Ivanov is 12,000 rubles. Deductions of 20% amount to 2,400 rubles. Thus, for the next two months Ivanov will receive 9,600 rubles, and in the third month - 10,800 rubles.
Conclusion
The reader now knows whether the pension is taxed or not. Basically, when it comes to old-age insurance pension, there is no need to pay personal income tax. The obligation can appear only in the formation of a funded pension, but not always. The conclusion about whether a non-state pension is taxed can be made on the basis of an agreement with a private pension fund.
For working pensioners, personal income tax is withheld from wages in a standard manner. At the same time, they have the right to receive a tax deduction. At the same time, regardless of whether the pensioner continues to work or not, he gets tax benefits. And the obligations that he had before retirement continue to be valid. In accordance with them, deductions from pension payments are made.