Material assistance to an employee can be provided by the employer in the form of cash payments or in material form. Sometimes it is written out to both former employees and persons who are not working in the enterprise.
Definition of the term
Such a concept as “material assistance to an employee” does not contain a single legislative act. The definition of this term can be found in the economic dictionary. It is he who explains that financial assistance to an employee is nothing more than cash payments or the transfer of material benefits in material form to needy employees.
Grounds for payment
Paying social assistance to employees is not an obligation. The components of the salary are indicated in the first part of Art. 129 of the Civil Code of the Russian Federation. Material assistance to the employee is not listed. Other legislative acts do not contain obligations to pay it.
As a rule, each organization stipulates the procedure and developed conditions for the provision of any material assistance to employees in its local act. It can be a collective agreement , etc. The payment of material assistance is often covered in the agreement, which is signed by both the employee and the employer. Such a document is an employment contract. It provides guarantees to the employee, allowing to prevent the deterioration of his situation in comparison with the norms contained in the labor legislation. That is why material assistance to an employee can be regarded as an additional condition of the agreement. At the same time, it is intended to improve the social situation of a person.
In which case are accruals made
Material assistance to an employee is provided if he needs financial support in connection with the events that have to be confirmed by the provision of documents. We can talk about the wedding and the birth of a child, the death of a family member and emergency situations (theft, fire, etc.). Financial assistance can be provided for the holidays, New Year's Eve, or any other date. The list of all events should be fixed in the regulatory local acts of the organization, collective or labor contract.
The basis for the provision
Material assistance is referred to as non-productive payments. In this regard, its source is the profit of the organization. Since no legislative documents provide financial assistance, its payment is made only at the discretion of the employer.
The basis for the provision of financial or material support to the employee are various regulations. So, an employee may write an application for financial assistance. In the event that after its consideration the manager gives a positive answer, an order is issued. This document indicates the following:
- reference to the normative act, which stipulates the possibility of providing financial assistance;
- FULL NAME. the person to whom the payment is intended;
- the reason for the decision to provide assistance;
- amount of payments;
- term of accrual.
There may be cases when the procedure and conditions for the payment of assistance to employees are not established in regulatory local acts. Despite this, the employee is not prohibited from providing social support . How this issue will be completely resolved depends on the opinion of the head of the enterprise.
Financial assistance to the employee can be provided at the initiative of the employer. As a rule, these are payments for any celebration or anniversary of the employee. As in the previous case, the basis for accruing such material assistance will be an order signed by the head of the enterprise.
Payout Amounts
The amount of financial assistance that the employer provides to its employees is also not specified in the current legislation. All amounts are reflected in the regulatory local acts of the organization and can be established by the head of the enterprise in absolute terms or in multiples of the official salary. The amount of financial support for employees is directly dependent on individual situations, as well as on the capabilities of a particular enterprise.
Types of financial support
Material assistance to an employee can be paid in various cases. In this case, the reason for making a decision on the provision of financial support may be the following:
- The difficult financial situation of the employee.
- Emergency or natural disaster. In this case, the employee who wrote a statement to the head asking for financial assistance should present certificates from the police or other authorities that would confirm the amount of damage.
- The presence of family circumstances. Workers claiming to receive material payments from the enterprise on these grounds must submit supporting documents to the accounting department of the enterprise. This may be a marriage certificate or birth certificate and other documents.
- A serious illness of the employee or his relatives. Such an ailment implies a loss of working capacity for more than two months or an employee becoming disabled. The basis for the payment of this type of material assistance will be a certificate of the VKK of the established form.
- Anniversary date.
- The need for recovery. Such material assistance can be received by the employee in the form of full or partial payment of the cost of the permit.
- The need to improve living conditions. The employer can provide such material assistance for the purchase of housing, as well as for its construction or reconstruction. In this case, the employee must be provided with certificates of registration with local executive organizations as needing to improve living conditions and receipts for payment of expenses incurred.
The employer may also provide financial assistance to the employee for burial. The basis for its payment is the death of any close relative of the employee or himself. A confirming document for such payments will be a copy of the issued death certificate, as well as those papers that reflect the payment of funeral services.
Accounting
The accounting entries also depend on whether material assistance is prescribed or not in regulatory local acts. In the event that the organization considers the financial incentive of the employee to be part of his payment for labor, these amounts are reflected on the loan of the seventieth account, which includes settlements with staff on remuneration for participation in production processes.
In the event that the accrual and payment of assistance is carried out according to the application written by the employee, everything is reflected in the loan of the seventy-third account, which takes into account payments made by the staff for other operations.
Financial support may be provided to former employees. In this case, all calculations should be reflected in the seventy-sixth account, taking into account transactions with different creditors and debtors.
The debit of the account, which reflects all the amounts paid, is a financial source. It must be indicated in the order for assistance. When using the profit of previous years, the eighty-fourth account is debited, and the current profit is reduced by the debit of the ninety-first, where other expenses are reflected.
If employee support is part of the payroll, then what accountant should post? Material assistance in this case is reflected in 20, 26 or 44 cf. debit (in CT 70).
Accounting in budgetary organizations
The code of financial assistance, which is paid by state organizations at the expense of the salary fund, is 211. Such accounting is regulated by the instructions of the RF Ministry of Finance dated 10.12.2004, number 114. The procedure for applying the budget classification also indicates the code to which material assistance to former employees is assigned.
Such amounts are paid at the expense of other expenses or social security. These, respectively, are codes 290 and 260. But, be that as it may, the provision of any material assistance will certainly be reflected in the relevant regulatory legal acts.
Base for income tax
So, the employer issued an order according to which financial assistance should be provided to the employee. In this case, taxation is characterized by some nuances. Material assistance has nothing to do with remuneration for work. That is why it is not included in the costs that the organization incurred in the manufacture of its products. These payments are referred to in Art. 270 (p. 23) of the Tax Code of the Russian Federation. This legislative act establishes that the amount of assistance provided is not included in the base for calculating income tax.
Non-taxable material assistance
There are some types of financial support for employees, paying which there is no obligation to charge insurance premiums, as well as withholding personal income tax if the employer provided targeted financial assistance to the employee. In this case, taxation does not provide for the calculation of insurance premiums or personal income tax. This applies to lump sum payments in connection with various emergency situations, as well as regarding the adoption or birth of a child, on the occasion of the death of close relatives or the employee himself. The legislation also provides for a number of other benefits related to taxation of material assistance.
Target Payments
The financial assistance provided in the event of an emergency, death or birth is not subject to insurance contributions and personal income tax. However, such an exemption can only be applied if the employee attaches supporting documents to the application. They can be certificates from the Ministry of Emergency Situations, as well as copies of a birth or death certificate, etc. If there are no documents required to confirm the benefits, the inspectors may be fined twenty percent of the outstanding tax amounts, the contributions themselves will be assessed and the calculation made penalties.
Targeted assistance is not taxable in cases where its provision was made in kind. For example, a company made repairs on its own or arranged a funeral.
Features of the application of benefits
The taxation of targeted material assistance has its own nuances. If financial support was provided in connection with an emergency, then the recipient should be the victim himself. Allowed the payment of such assistance to any member of the family of the employee who died as a result of an emergency. The main purpose of the support is the compensation of material damage or damage to health. At the same time, the legislation does not establish restrictions on the size of non-taxable amounts.
In the event of the death of an employee, who should be considered members of his family? The Ministry of Finance of the Russian Federation notes that these are parents, spouse and children.
The organization may provide financial assistance to the employee on the occasion of the death of one of his family members. This type of financial support also falls under the list of benefits and is not subject to personal income tax and insurance premiums. This exemption may also apply to former employees of an organization who have retired.
When paying money to employees or giving them valuable gifts at the time of birth, some nuances should be taken into account. Such material assistance insurance premiums and personal income tax will not be taxed. However, this benefit can only be applied during the first year after the baby is born. In addition, for non-taxable payments, the state has set a limit. Its value amounts to fifty thousand rubles, which can be received per one newborn.
Taxation of the presented gift may be made only if this fact is provided for in the collective agreement or other local regulatory act. When a gift contract is made, contributions are not calculated.
Inappropriate help
In addition to the above types of payments, there is another type of financial support, which also belongs to the category of non-taxable. This is non-targeted assistance paid to an employee for any needs. However, it should be borne in mind that the non-taxable amount is four thousand rubles in one year. If the organization decided to pay out assistance in a larger amount, then it should be issued in the form of a gift. In this case, the amount of eight thousand rubles per year will not be subject to taxation. In this case, you will need to conclude a deed of gift.
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