The most popular tax for each person who has reached working age is personal income tax, or income tax. Due to it, the federal, regional and local budgets are largely formed. In order to correctly apply the existing system of personal income tax collection, it is necessary to have an idea of what kind of income people have and which of them are included in the taxable base.
Income on which personal income tax is accrued
Personal income tax is charged on all types of personal income. They include:
- Salary in the main place and part-time.
- Bonus payments.
- Payment of the main and additional holidays.
- Payment of sick leave.
- Gifts and winnings.
- Fees for intellectual activities.
- Insurance payments.
- Payment for work under civil law contracts.
- Proceeds from the sale of property.
- Lessor income under a lease.
- Other income of the taxpayer.
For the correct calculation of personal income tax does not matter the citizenship of an individual, it only matters whether he is a resident or not. This is determined by how many days this person spent in the year (the calendar year is the tax period for personal income tax) within the borders of Russia. If you stay in the country for more than 183 days, a person is considered a resident, otherwise - a non-resident. For a resident individual, all income is subject to taxation in accordance with the law. A non-resident pays only on the income that he received from a Russian-based source.
An individual’s taxable income tax base consists of all income issued to him in financial or in kind, with the exception of amounts that are tax-free and various types of deductions in accordance with the Tax Code.
What income is not subject to personal income tax
You need to understand: in relation to income tax there are no so-called beneficiaries, that is, individuals who are completely exempted from paying it. Only certain types of income are subject to exemption:
- Maternity benefits for women.
- Insurance and funded pensions.
- Social benefits for retirement.
- All legislatively approved compensation related to: compensation for damage to health; with free allocation of premises for living and utilities; with the dismissal of the employee, with the exception of paying for unused vacation.
- Payment for donated blood and breast milk to donors.
- Alimony received by the taxpayer.
- The financial assistance paid to employees in the range not exceeding four thousand rubles.
- Material assistance paid to employees at the time of birth or adoption of a child to the extent not exceeding 50 thousand rubles.
- Other income listed in the Tax Code of article 217.
Different types of deductions are taken from the tax base when calculating personal income tax. This is a statutory amount that is tax deductible. Deductions are granted to citizens with children, representatives of certain professions, veterans, people affected by technological disasters, and others listed in the Tax Code.
Information provided by the tax agent to the IFTS
All organizations and individual entrepreneurs with hired workers become tax agents for them on personal income tax. What are their responsibilities? Firstly, all income paid by the employer to an individual must be deducted from income tax. Secondly, withheld amounts must be transferred to the account of the Federal Tax Service within the time period specified by law. Thirdly, after the end of the calendar year (it is the tax period for personal income tax), the agent is obliged to provide the inspection with information about all withheld and transferred income tax amounts for each employee. The employer provides a certificate for each employee in the form of 2-personal income tax in the time specified in the Tax Code.
Providing late or lack of information entails penalties. The codes in 2-personal income tax in 2016 were slightly different from the current ones.
How to fill out a certificate 2-NDFL
In 2017, Form 2-NDFL is in force, the form of which was approved in the Order of the IIM 7-11 / 485 of 10.30.15.
How to fill out 2-personal income tax so that the form is verified and accepted by the tax inspector? First of all, pay attention to the sections of which it consists:
- Section 1. The name, address, telephone number, TIN, KPP, OKTMO code of the tax agent are indicated.
- Section 2. The taxpayer identification number, name, patronymic, status, date of birth, citizenship, passport details and taxpayer address are completed.
- Section 3. On a monthly basis, all accrued taxable amounts are disaggregated in accordance with the income code, and professional deductions are made.
- Section 4. Codes and amounts of social deductions, as well as property and investment are filled.
- Section 5. The income for the whole year is summed up, the tax base is calculated, the tax payable is calculated, the personal income tax withheld and transferred is indicated.
Before filling out 2-NDFL, it is necessary to check the relevance of the data on the address, details of the taxpayer passport. If the data has changed over the past year, you need to make corrections. When an employee applies for income tax refunds when buying a home or paid tuition and treatment, the Federal Tax Service will find a discrepancy in the information and the documents presented. A sample of the new 2-NDFL form is presented in this material.
What is an income code and how is it determined
The income codes for the 2-NDFL certificate must be selected from Appendix No. 1 to Order No. MMV-7-11 / 387 of 09/10/15. In it, each type of income that an individual can receive in cash or in kind is assigned a unique four-digit code .
It is very important for the employer to determine which code the income belongs to and correctly indicate it in the certificate. The list approved by the Ministry of Finance is constantly being amended. An example is the calculation of salaries and benefits. This operation is performed by each employer. In 2015, after the approval of the new list, income was distributed as follows:
- Accrued wages ( including bonuses) - code 2000.
- Accrued vacation pay (including payment of unused vacation leave) - code 2012.
- Paid temporary disability certificates - code 2300.
In 2016, the list of codes in 2-NDFL was amended: premiums were allocated from the amount of wages, and they were divided depending on the source of payments. In 2017, they allocated and assigned a separate compensation code for the remaining days of leave upon dismissal from the amount of the leave paid to the employee. In the report for 2017, the income of employees as a result of the calculation of wages and benefits will be distributed according to the income codes in 2-NDFL thus:
- Accrued salary - code 2000.
- A bonus has been accrued for production results and other indicators paid from the wage fund not at the expense of net profit or special-purpose funds - code 2002.
- Accrued premium for the same indicators due to profit and targeted financing - code 2003.
- Accrued vacation pay - code 2012.
- Accrued payment for the remaining days of leave upon dismissal - code 2013.
- Paid temporary disability certificates - code 2300.
When wages, benefits and compensations are kept in special programs, such as 1C: Enterprise, it is enough to make the appropriate additions to the program once at the time the next change to the list is put into effect. When calculating the salary manually, the accountant will need to carefully distribute the income of individuals. According to article 126.1 of the Tax Code of the Russian Federation, for a tax agent providing information containing inaccurate information, a fine of five hundred rubles per document is threatened. If there are many employees, the amount of the fine in the case of an incorrectly selected income code will be sensitive.
What is income code 4800 intended for?
The decoding of the income code 4800 in the appendix to the order of the Ministry of Finance reads as “other incomes”. No further explanation was provided. This means that when paying or giving out in kind (prizes, gifts, uniforms) to an individual income that is not included in the tax exempted list on the basis of the Tax Code of the Russian Federation, it is necessary to withhold and transfer income tax to the state.
What to do if income is not indicated in the current list? It is assigned to income code 4800, the decoding of which means “other income”. It must be remembered that in the case when the extradition was made in kind, its value is determined, but it is impossible to withhold the tax, because nothing is paid in monetary terms in the tax period after this extradition to the individual. It is the responsibility of the tax agent to report this to the IFTS.
Taxation of per diems on a business trip
Most often, code 4800 is used to reflect the employee's income in the form of daily subsistence allowance paid for while on a business trip. The amount of travel expenses is determined in the "Regulation on business trips", which is an annex to the collective agreement. This is an optional document, you can write all the necessary points in the "Internal Rules", or the order of the head. But many organizations accept the Regulation, it can be created in programs for personnel management with automated accounting. The size of the per diem is established by decision of the management and is not limited by the upper limit. It must be remembered that article 217 sets out the maximum daily allowances that are not subject to income tax:
- On business trips within the borders of Russia - 700 rubles.
- On business trips abroad - 2500 rubles.
Per diems exceeding this limit are subject to 2-NDFL. For example, if the daily subsistence allowance of 1000 rubles was determined for an internal business trip in an organization, the employee traveled for five days, he was charged 5000 rubles. Of these, 700 x 5 = 3500 rubles. not subject to personal income tax. Amount 1500 rub. must be included in the certificate 2-PIT in the month when the per diem was calculated and issued, with income code 4800.
A similar situation with the size of travel expenses for accommodation. The organization has the right to provide in its Regulation for full reimbursement of living expenses on the basis of the documents provided. In the absence of documents to the employee, compensation in a fixed amount may be determined. Article 217 limits the amount of non-taxable compensation for accommodation without supporting documents:
- On business trips within the borders of Russia - 700 rubles.
- On business trips abroad - 2500 rubles.
Amounts in excess of those specified in Article 217 are subject to income tax and are displayed with an income code of 4800. All amounts related to this code should be deciphered in accounting so as to avoid misunderstandings during tax audits.
Withholding personal income tax from surcharges to the average monthly salary when paying certain types of benefits
Organizations have the right to pay their employees during periods when they do not work and receive benefits from the social insurance fund. This may be a disability or maternity leave payment.
If social benefits calculated in accordance with the rules established by law turn out to be less than the average monthly earnings of an employee, an additional payment can be made to compensate for this difference. This is an optional payment. The organization’s order establishes a list of employees (it may not include all the staff) who are paid extra benefits, and the calculation procedure.
If the sick leave payment is fully taxed with income tax, then the surcharge to it is also included in the base and is recorded in 2-NDFL under code 2300. Maternity leave is exempt from tax, but the surcharge made is not a state allowance. On this basis, it is included in taxable income and in the certificate 2-PIT at the time of payment is accounted for by code 4800.
In what cases is personal income tax withheld from compensation upon dismissal
In cases of reorganization, change of ownership of the enterprise, sometimes there is a replacement of the management team - the head, deputy heads, chief accountant. When these employees are dismissed, a number of payments are legislatively provided:
- The allowance for dismissal.
- Saved wages at the time of employment.
- Compensation.
Article 217 makes these payments exempt from taxation in an amount not exceeding three times the average monthly salary, or six times in the case when employees leave the company located in the Far North or in areas equivalent to them. Payments to specified employees exceeding the tax-free maximum are taxable income and in the certificate 2-NDFL will be indicated by income code 4800 and in decoding.
What other incomes can there be?
An organization that needs qualified personnel is ready to recruit specialists living in other places. At the same time, managers often even pay candidates for the job travel for an interview and other expenses associated with it. Moving an employee to a new place of work is not taxed. But the candidate is not an employee, therefore, reimbursement for the submitted travel documents, hotel bill is taxable income. There is no code for it in the list, therefore, in the certificate the amount should be displayed as other income under code 4800. The organization is required to withhold and transfer income tax from other income. Two options are possible here:
- The candidate bought tickets, paid for accommodation, handed over documents to the organization for reimbursement.
- Tickets were purchased and the hotel was paid by the organization itself.
In the first case, problems should not arise: after calculating the compensation, the accountant will withhold personal income tax from him and transfer it to the budget. In the second case, there is nothing to withhold tax. Although the income is undoubtedly received, it is in such a form that withholding is impossible. In this case, no later than February of next year, the organization, based on the requirements of the Tax Code, must inform the inspection of an obstacle to tax withholding.
There are situations when, during a tax audit, inspectors charge certain amounts to code 4800. These are incomes that should not be included in the taxable base in accordance with Article 217, but due to the absence or incorrect execution of relevant documents (no contract, no certificates confirming the status of a taxpayer , etc.) are not accepted by inspectors in this capacity. They can be attributed to other incomes (income code for 2-NDFL - 4800) and withhold tax, as well as charge a fine or fine.
The base on which income tax is charged is very diverse. It includes many different accruals, remunerations, allowances, compensations, payments, etc. In order to correctly classify all this diversity by income codes, thoughtfulness and attention are needed. The correctness of tax calculation will ultimately depend on these qualities.