Bank deposits are considered one of the most common ways of accumulating and saving funds for citizens. Deposits allow you to save and increase your money. However, in accordance with applicable law, deductions to the budget must be made from each profit. Not all citizens know how taxation of bank deposits of individuals is carried out. Meanwhile, information about this serves as the basis for making the right decision on the placement of their funds in accounts in a financial organization. Let us further consider in detail the taxation of bank deposits of individuals.
General information
Keeping funds on deposits with banks is a passive investment. One of the advantages of these operations is the minimum action of the owner of the finances in relation to his capital. This applies equally to taxation of deposits of legal entities and citizens. A financial institution independently makes all necessary contributions.
Relevance of the issue
When choosing a bank deposit, the owner of the funds, as a rule, calculates the estimated income. At the same time, it is based on the amount, terms and deposit rate. Moreover, taxation of income on deposits is usually not taken into account. This is due to the fact that many citizens do not even think that this profit may fall under the provisions of the Tax Code. This state of affairs is understandable. Firstly, as was said above, taxation of deposits is assigned to financial institutions, and usually the owner of funds is the last to know about the collection of a certain amount. In addition, the requirement of the Tax Code does not apply to every deposit.
Retention Features
In accordance with the current legislation, taxation of cash deposits is valid for deposits opened by citizens - residents of the country. Withholding is also carried out from non-residents' accounts, if the sources of their profits are related to activities in the Russian Federation. In accordance with different categories, certain rates are set, as well as the principles by which they are deducted.
The procedure for collecting personal income tax
Taxation of deposits of individuals is carried out in accordance with the established scheme. Collection is made from accounts:
- In national currency. Deposits are taxed if their rate is higher than the CBR refinancing rate (more than 8.25% at present) plus 5%.
- In foreign currency. Deductions are made if the rate is above 9%.
The basis is the difference between the actual profit from the deposit and the amount received at the threshold rate. The basis of the calculated income is a nominal rather than an effective tariff. This means that in the scheme there is no difference between deposits with capitalization and simple deposits.
Important point
In case of concluding an agreement for a period of less than three years, only the rate that is valid on the date of registration (continuation) of the account will be of importance. Mandatory deduction is charged at the time of payment of interest. The financial institution maintains strict reporting. All interest income of individuals is taken into account, along with this, a tax is transferred on their income. Control of these operations is entrusted to the relevant authorities: the Central Bank, the Federal Tax Service, and audit organizations. The amount of deductions should be reflected in the declaration drawn up in the form of 3-personal income tax. It is necessary when receiving tax deductions and other things.
Finance company operations
Taxation of deposits of individuals can be carried out every month or at the end of the deadline (in accordance with the agreement). For residents, deductions - 35%, for non-residents - 30%. The financial company performs the calculation, deduction and deduction of the mandatory payment to the budget. In some cases, organizations provide customers with special calculators. With their help, owners of funds can calculate their profits, as well as taxes that they are required to pay on income. For each client who makes a profit from investing, a financial company draws up a certificate. It indicates the tax base and the amount of withholding. The amount of capital placed on the deposit is not included in the certificate. Such a document is issued by a financial company upon written request of a client.
Special cases
Citizens can place their funds in the accounts of financial institutions located abroad. In this case, it should be determined whether there is an agreement between the country in which this bank is located and Russia, which allows to exclude repeated deduction from profit. If such a contract exists, the client can choose the country to the budget of which he will make mandatory contributions. If the owners of the funds do not indicate this, then taxation of bank deposits is made in accordance with the legislation of the state in which the financial institution is located. However, clients can subsequently claim a refund of the funds paid to transfer them to the budget of the Russian Federation. If the above agreement is absent, then often taxation of deposits in foreign financial institutions is carried out twice.
Likely difficulties
Taxation of bank deposits may be difficult if during the period in which the agreement is in force, the base of mandatory contributions has changed. This situation may be due to several factors:
- Change in the size of the deposit due to its capitalization or the possibility of replenishment.
- Graduation rate when adjusting the amount on the account (if allowed by the terms of the contract with a financial institution).
- Change in the size of the Central Bank refinancing rate.
In such cases, taxation of deposits (or its termination) begins immediately from the moment the relevant rate is adjusted. The amount of deductions, in turn, changes when the base changes. In case of early termination of the deposit agreement and transfer of funds to the “demand” category with a reduced interest rate, withholding of the tax payment is terminated. Sent funds to the budget can be returned at the request of the client and transferred to his current account.
The specifics of deductions from profits of enterprises
It should be noted that taxation of deposits of organizations is carried out differently than for deposits of citizens. The profit that enterprises receive when investing in the accounts of a financial institution belongs to the category of revenues from non-operating transactions, depending on whether the deduction regime is provided for the company: simplified or general.
Taxation of interest on deposits
The simplest cases are payments without capitalization at the end of the contract period. However, often registration of term deposits is carried out with the condition that interest is paid quarterly or monthly. In these cases, the financial institution withholds personal income tax according to this schedule. Thus, taxation of interest on deposits is carried out with the same frequency as their accrual. Withholding personal income tax during capitalization (using compound interest) or with the possibility of replenishment of the deposit is somewhat more difficult.
In such cases:
- With an increase in the size of the deposit, the size of the tax base and the amount of mandatory deductions to the budget each time change.
- If the gradation of rates is provided in accordance with the amount of funds in the account, a certain rule applies. It consists in the fact that if, at the check-in date, the tariff was lower than the refinancing rate plus 10 pp for deposits in national currency or less than 9% for foreign currency savings, payments to the budget are not made. If the client replenished the account or interest was added to the amount, and the rate, increasing, became equal to the value after which the profit is subject to taxation, the banking company is obliged to withhold personal income tax for the time from which the increased tariff began to operate.
Deposit Termination
In case of early termination of the agreement and recalculation of the rate at reduced tariffs (as a rule, for demand deposits it is not higher than 1%), even if interest income taxation was previously provided, personal income tax will not be charged. If he has already been expelled on the date of termination of the deposit agreement, the client can return it by his written application. When taxing interest, it is also necessary to take into account the changes that the Central Bank refinancing rate is subject to (both downward and upward). The collection of personal income tax or the termination of its withholding is carried out from the date of the official tariff adjustment. In addition, it should be remembered about deposits in precious metals. In this case, all profits are subject to taxation, but the personal income tax rate for such deposits is 13%.
Conclusion
Taxation of deposits should not be considered a negative point in the financial activities of individuals. It should not influence the choice of the organization in which the account will be opened. As practice shows, although taxation reduces the potential amount of individual income, a deposit remains today one of the most attractive and reliable methods of investing.