Law No. 149-FZ, dated July 27, 2006, defines a website as a set of software products and information materials, accessed via Internet channels with reference to network names. The components of the sites are presented:
- content (articles, discussions on forum threads);
- software block (ensures the functionality of the site and allows you to manage the resource);
- visual and graphic elements that form the visibility of the material and page design.
Question: How to reflect the costs of creating a website in the accounting of a trade organization? In order to increase trade turnover, the organization decided to develop a website, concluding an agreement for its creation with a specialized organization. The amount of expenses under the contract amounted to 216,000 rubles. (including VAT RUB 36,000). The organization accepted the exclusive right to the created website for accounting as an intangible asset (IMA), establishing for it a useful life (SPI) in accounting and tax accounting equal to 36 months (based on the expected period of use of the site). According to the accounting policy in accounting and tax accounting, depreciation on intangible assets is calculated using the straight-line method. The site began to be used in the month of acceptance of work on its development. For tax accounting purposes, income and expenses are determined using the accrual method. View answer
The creation of each block of website structure is accompanied by material expenses. For the resource to work, you need to:
- develop a design layout;
- write program code;
- layout pages;
- fill with information;
- purchase a domain name;
- pay for hosting (rent space for a website on a server from the selected provider).
FOR REFERENCE! Civil Code of the Russian Federation in Art. 1261 recognizes websites as a set of computer programs, supplemented by information databases and graphic elements. All these components fall within the scope of copyright law. Exclusive rights may belong to the developer or be transferred to the customer of the services.
Content:
We take into account the costs of creating a website.
The website is an intangible asset.
We determine the initial cost of the site.
Letter of the law. When the exclusive right can pass to the employee.
We calculate the amount of depreciation of the site.
Register the domain name of the site.
If the site cannot be classified as an intangible asset.
Note. Since 2008, the concept of non-exclusive rights has not been used.
Costs of hosting and promoting the site.
We take into account the costs of creating a website
Today, many companies open websites on the Internet. Let's see what expenses an organization can take into account for these purposes when calculating income tax.
One or a set of several Internet pages related by a common topic and located at a specific address on the Internet is nothing more than a website. The site can contain text materials, photographs, price lists, graphic images, as well as databases, programs, etc.
As a rule, on the website, the company indicates basic information about itself, provides contact information (telephone numbers and locations of offices or stores, surname, first name and patronymic of specialists or managers, their email addresses), a list of activities (name of works and services, assortment goods), messages about ongoing promotions and discounts.
A company can conduct business directly through a website on the Internet, that is, trade through online stores.
The tax accounting procedure for the costs of developing and maintaining an Internet site depends on whether the created object is recognized as an intangible asset.
How can a $20/hour rate turn into $10/hour?
Previously, we charged an average of $20 per hour. But we realized that there are times when this is inappropriate. Last year we introduced the practice of internships under the control of managers. Of course, we can't sell an intern's work for $20 an hour. And in order not to fool the client, we introduced coefficients. Initially, the coefficient is – 1. This is a rate of 20 dollars per hour. For the work of a specialist like a junior, we introduce a correction factor of 0.5, that is, 10 dollars. But we sell art director’s watches at a factor of 1.5. And this should also be reflected in the estimate.
The website is an intangible asset
For profit tax purposes, an Internet site can be classified as an intangible asset if it meets the requirements established in paragraph 1 of Article 256 and paragraph 3 of Article 257 of the Tax Code:
— the organization owns exclusive rights to the website;
— the site is used in the production of products, when performing work, providing services or for the management needs of the organization;
— the site is capable of bringing economic benefits (income) to the company;
— the site’s service life is over 12 months;
— the initial cost of the site is more than 20,000 rubles. (until January 1, 2008 - 10,000 rubles);
— the organization has properly executed documents confirming the existence of the intangible asset itself and (or) exclusive rights to it.
The fundamental difference between an intangible asset and other depreciable property is that the company has exclusive rights to it. From the point of view of civil law, an Internet site is a combination of two objects of copyright - a program that ensures its functioning, and a graphic solution (design).
A company can entrust the development of a website to employees who have an employment relationship with it, or to a third-party organization. If the creation of the website was carried out by one or more employees of the company and this was part of their responsibilities under the employment contract, it is considered that the company independently developed the website. In such a situation, exclusive rights to the site are assigned to the employer (unless otherwise provided in the employment or other agreement between the employer and the author), and copyrights are retained by the direct author (employee). This follows from Article 1295 of the Civil Code. Moreover, the author has the right to compensation.
An organization that has entrusted the creation of a website to a contractor is guided by the terms of the contract concluded with him, the subject of which is the development of an Internet site. In accordance with paragraph 1 of Article 1296 of the Civil Code of the Russian Federation, the exclusive right to a website (computer program or database) developed under such an agreement belongs to the customer. Of course, provided that the agreement between the contractor (performer) and the customer does not provide otherwise.
If, under an agreement to create a website, the contractor reserves exclusive rights to it, the customer organization does not have the right to classify the developed website as an intangible asset.
What, besides hours, should be included in the estimate so that the client understands what he is paying for?
An abstraction in the form of 30 designer hours needs to be translated by the client into a language that he understands. For example, we count the number of page templates. Each company, of course, has its own estimate and its own units of calculation. Our estimates are formulas into which the required values are simply substituted.
For example, we give the designer half a day, that is, 4 hours, to create one template. The task of a sales manager, when receiving a task for a project from a client, is to think through these conditions necessary for creating a website. And the client actually determines for himself how many templates are needed.
It looks something like this.
As a result, the manager builds a structure and marks in green the templates that will be used by designers. And subsequently we will describe all the pages of the site and the templates that will be applied to them.
For example, for an online store, 4-5 templates are taken, this is the minimum set. If we see that the client has many non-standard requests and many complex pages. Then we first build the structure of the site, and look at the pages that require special rendering, and also include them. And then we multiply the number of pages by 4 hours and get the total number of hours.
Thus, the estimate should contain the following information:
- stage of work
- Name of works
- number of elements of this stage of work
- number of hours
- total cost of the stage and name of work
Agency estimates vary greatly even for a strictly defined task. This is where the difficulty of choice lies. There is a saying: if three project managers in one company are given the same task, you will get 3 different estimates. And if one manager is given the same task to evaluate a website three times at different times, you will still receive 3 different estimates.
Therefore, any cost estimates are based on the studio’s processes and the company’s experience.
Deadlines often come at the design stage, when the client makes a lot of changes. Or in the middle of a project when the client remembers that he forgot something. But the timing for a project is always built from an ideal picture, with the expectation that everything will go according to plan, and nothing else.
For example, we schedule stages taking into account 2 days for client acceptance. But in reality, the client receives much more acceptance. And the reality is that deadlines are running out in most cases. I have not yet seen a single project where everything was perfect. This is what is bad about the fixed price and the so-called “waterfall” development model.
In such a situation, the development company must take the risks itself. It happens that the project’s marginality goes into the negative. In this case, we tolerate it, which means it’s our mistake, because we agreed with him on a fixed price, and we ourselves underestimated the project. The strength of a company is assessed by whether it can take on these risks.
One of the main problems in the market today is that the client does not understand what the cost of web development consists of. On the one hand, “cheap” websites are a myth that clients want to believe, but which destroys the client’s budgets and does not allow him to receive quality products. On the other hand, the cost of development in many studios is unreasonably high. Therefore, clients often wonder why, for the same website, studios set prices that can differ by 5 times.
We determine the initial cost of the site
Intangible assets are classified as depreciable property. Their cost is repaid by calculating depreciation (clause 1 of Article 256 of the Tax Code of the Russian Federation).
According to paragraph 3 of Article 257 of the Tax Code of the Russian Federation, the initial cost of a website is defined as the sum of expenses for its acquisition (creation) and bringing it to a state in which it is suitable for use. It does not include VAT and excise taxes.
The cost of a website developed by the organization’s employees is formed as the sum of the actual costs of its creation. These include, in particular:
— expenses for remuneration of workers directly involved in the creation of the site;
— patent fees, registration fees and other payments related to the execution and registration of exclusive rights;
— expenses for services of third parties;
- material costs;
- other similar costs.
The initial cost of the site is not increased by the amount of unified social tax and contributions for compulsory social insurance against accidents at work and occupational diseases, accrued from payments in favor of the workers who developed the site. The fact is that the specified tax and insurance premiums reduce the taxable profit of the current period as part of other expenses (subclauses 1 and 45 of clause 1 of Article 264 of the Tax Code of the Russian Federation, respectively). In addition, other taxes and fees taken into account in accordance with the Tax Code when calculating income tax are also not included in the cost of the site.
The initial cost of a website ordered to a contractor is formed from the amount paid for development and the costs of the customer organization for installing the resulting software package, debugging, testing, etc.
What specialists should be involved in the project?
This is a project manager, designer, HTML coder, programmer, tester. For example, we also have an art director involved in the process.
The cost of creating a website is determined from the participation of these specialists. Our task, as a developer, is to distribute this cost among the project participants, to predict how many hours it will take for a designer, how many hours for a programmer, art director, manager, tester, and so on.
The totality of specialist hours, taking into account the standard hour rate of $20, is the final cost of the project.
Of course, it’s not just the watch that is important to the client. The client cares about the product he receives in the end. The estimate drawn up by the studio should speak to him in a language he understands.
Letter of the law. When can an exclusive right pass to an employee?
The exclusive right to a work created within the scope of the employee’s job duties (official work) belongs to the author if the employer, within three years from the day the official work was placed at his disposal, does not perform one of the actions (Clause 2 of Art. 1295 Civil Code of the Russian Federation):
- will not start using this work;
- will not transfer the exclusive right to it to another person;
- will not inform the author about keeping the work secret.
We calculate the amount of depreciation of the site
To calculate depreciation of an intangible asset, it is necessary to determine its useful life. This is recognized as the period during which the object serves to fulfill the goals of the organization’s activities (clause 1 of Article 258 of the Tax Code of the Russian Federation). The taxpayer determines the useful life of an intangible asset independently on the date of its commissioning based on the validity period of the patent or certificate or the period of use of the object stipulated by the relevant agreements.
This means that if the contract for the development of an Internet site stipulates the expected useful life of its use, the organization, when calculating depreciation of the site, is guided by exactly this period.
Let’s say this period is not specified in the contract with the contractor, or the company developed the site on its own. Then she has the right to independently set the useful life of the site and consolidate it in the tax accounting policy.
If the useful life cannot be determined, then, according to paragraph 2 of Article 258 of the Tax Code of the Russian Federation, the object of intangible assets will have to be amortized over ten years, but not more than the period of activity of the taxpayer. Therefore, in order to avoid problems with justifying the useful life of the site, it is advisable to indicate this period in the contract with the developers or in the technical specifications drawn up for employees.
The organization begins to calculate depreciation from the 1st day of the month following the month in which the site was put into operation (clause 2 of Article 259 of the Tax Code of the Russian Federation). The date of commissioning of the site is the moment of its placement on the Internet. By this time, all work on creating, testing and setting up the site should be completed. The company independently calculates the amount of depreciation charges based on the initial cost of the site and its useful life.
LAYOUT STAGE
Layout is directly related to design. For the first layout layout we take 8 hours. For all subsequent 3 hours. We take the number of internals based on the design. To this we add 30% for testing. We also take 8 hours for the adaptive work (the main layout) and 1.5-2 hours for finishing each page. And thus, since we have all this entered into Excel in the form of formulas, the sales manager, when preparing the estimate, writes down only one figure - the number of internal pages, and all this is automatically calculated.
Registering a website domain name
After completing the creation of the site, you must assign it a domain name and register it in the prescribed manner.
The domain name of a site is its unique name and address on the Internet (for example, the website of the Russian Tax Courier magazine is www. rnk. ru). The domain name is registered to ensure its uniqueness at the Russian Research Institute for the Development of Public Networks (RosNIIROS) or with registrars authorized by it. Services for registering a domain name are considered provided from the moment the information is entered into the domain name register.
The website domain name is not recognized as an independent intangible asset, since it is not the result of intellectual activity. But if the site is accounted for as an intangible asset, the costs of the initial registration of its domain name are included in the initial cost of the site (clause 3 of Article 257 of the Tax Code of the Russian Federation). After all, the initial cost of an intangible asset is defined as the amount of expenses not only for its acquisition or creation, but also for bringing it to a state in which it is suitable for use. Without registering a domain name, a website cannot function.
Primary means the registration of a domain name, carried out when creating a website. Typically it is valid for one year. Subsequently, the domain name must be re-registered annually. It does not lead to changes in the quality characteristics of the website and does not affect its initial cost.
The costs of renewing registration are included in other expenses associated with production and sales (subclause 49, clause 1, article 264 of the Tax Code of the Russian Federation). They are taken into account gradually during the validity period of the domain name registration specified in the relevant agreement (Clause 1 of Article 272 of the Tax Code of the Russian Federation). If the registration period is not specified in the contract, the organization distributes the costs independently.
Example 1
CJSC Fragment decided to place its own website on the Internet. The organization entrusted the development of the website to its specialists working under employment contracts. The work was carried out from February to March 2008. In April 2008, the company's website was posted on the Internet. The costs for creating the site were:
— programmers’ salary — 80,000 rubles;
— UST, insurance contributions to the Pension Fund and for injuries from the salaries of programmers — 20,960 rubles;
— depreciation of computers and other fixed assets that were used in the development of the site — 3,900 rubles;
— design layout of the website performed by a third party — 23,600 rubles, including VAT 3,600 rubles;
— initial registration of a website domain name — 2006 rubles, including VAT 306 rubles.
Exclusive rights to the site belong to CJSC Fragment, since the organization independently developed the site and the employment contracts with the employees involved did not provide for a special procedure for the transfer of these rights. In addition, the created site meets the requirements for intangible assets. Therefore, the company takes into account the developed website as part of intangible assets. The organization established its useful life as a general rule - ten years (120 months).
The initial cost of the site in tax accounting is 105,600 rubles. (80,000 rub. + 3,900 rub. + (23,600 rub. - 3,600 rub.) + (2,006 rub. - 306 rub.)). Amounts of unified social tax, insurance contributions to the Pension Fund and for injuries from programmers' salaries are not included in the initial cost of the site. They relate to other expenses associated with production and sales, and reduce the taxable profit of current periods.
Since the site was posted on the Internet in April 2008, JSC Fragment begins to accrue its depreciation in May. The amount of monthly depreciation recognized for profit tax purposes is 880 rubles. (RUB 105,600: 120 months).
We take a non-standard path: this is when everything works for you, but it doesn’t look very good yet
The project can be implemented differently, but for this you need to trust the developer, or have certain competencies yourself. You can start developing a website not with prototyping or design at all, but start with software development. In this case, we assemble a software framework, develop the logic for user interaction, and only then implement the design. In the case when the design comes first, designers often create complications that will then have to be paid for during implementation. That is why, when we do complex projects, such as startups, we include design only after we have built the detailed program logic of the project. This is when everything works, but it doesn’t look very good yet.
If the site cannot be classified as an intangible asset
As already noted, an organization that does not own exclusive rights to an Internet site does not have the right to take it into account as part of intangible assets. There are other situations where a website cannot be classified as an intangible asset, for example:
1) the organization received exclusive rights only to the website design, and it uses the software under a license agreement. And vice versa: the organization has exclusive rights only to the computer program that ensures the operation of the site, and the rights to use the site design are obtained under a license agreement. According to paragraph 1 of Article 1259 of the Civil Code of the Russian Federation, both the website design and the computer program are objects of copyright. However, they should not be recognized as separate intangible assets. The fact is that the constituent elements of the site (design and program) are unlikely to function separately. In addition, design developments by themselves are not likely to bring economic benefits to the organization;
2) the company received exclusive rights to the site for a period of less than 12 months;
3) the cost of exclusive rights to the website is less than 20,000 rubles.
In these cases, the expenses incurred may be recognized in tax accounting. They are recognized evenly over the period for which exclusive rights are obtained or a license agreement is concluded for the use of individual elements of the site or the site as a whole (clause 1 of Article 272 of the Tax Code of the Russian Federation). This period is determined from the relevant agreements. If such a period is not established in the contracts, the organization itself distributes these costs after posting the site on the Internet.
In tax accounting, these costs are considered other expenses associated with production and sales. Depending on the specific circumstances, they may be included in various expenses.
Firstly, if the website contains advertising information about the activities of the organization, the costs of creating the website are taken into account as advertising expenses (subclause 28, clause 1, article 264 of the Tax Code of the Russian Federation). Indeed, on the basis of paragraph 4 of Article 264 of the Code, an organization’s advertising expenses include, in particular, expenses for advertising events through telecommunication networks. Such advertising expenses are not subject to rationing, that is, they are recognized for profit tax purposes in full. A similar position is set out in the letter of the Ministry of Finance of Russia dated March 12, 2006 N 03-03-04/2/54.
Secondly, the cost of an Internet site can be reflected as expenses for the purchase of computer programs and databases in accordance with subparagraph 26 of paragraph 1 of Article 264 of the Tax Code of the Russian Federation.
In other cases, the costs of website development are taken into account as other costs associated with production and sales (subclause 49, clause 1, article 264 of the Tax Code of the Russian Federation). Of course, in all of the above options, the costs of creating a website must comply with the requirements of Article 252 of the Tax Code of the Russian Federation, that is, they must be justified and documented, and the website must be used in activities aimed at generating income.
Costs for the initial registration of a domain name for a website that is not an intangible asset are recognized during the registration period (usually one year) and reduce the profit subject to taxation on the basis of subparagraph 49 of paragraph 1 of Article 264 of the Tax Code of the Russian Federation as other expenses. If the registration period is not specified, then the taxpayer distributes such expenses independently. The costs of domain name re-registration are reflected in a similar manner.
In addition, an organization that makes periodic payments under a license agreement for the use of rights to the results of intellectual activity (rights to a website or its individual components - design or software) has the right to include them in expenses on the basis of subclause 37 of clause 1 of Article 264 of the Tax Code of the Russian Federation. Such payments are recognized evenly, that is, in equal shares over the period for which the specified rights are granted.
Example 2
Epizod LLC (trading company) entered into an agreement with Design CJSC (specialized company) to develop an Internet site. The site is supposed to post information about the range and prices of goods sold by the trading company, about current discounts and ongoing promotions. According to the agreement, Epizod LLC receives exclusive rights for five years only to design developments, the cost of which is 46,020 rubles, including VAT of 7,020 rubles. The company uses the software product on the basis of a license agreement. The cost of the computer program is 35,400 rubles, including VAT 5,400 rubles. The license is also valid for five years (60 months). Work on creating the site began in April 2008. In the same month, Epizod LLC registered the site's domain name for one year. For the initial registration, it transferred 1,416 rubles, including VAT of 216 rubles. The site was posted on the Internet on April 25, 2008.
Design developments are not an independent intangible asset, and the website contains advertising information about the company. Therefore, for profit tax purposes, Epizod LLC takes into account the costs of website design as advertising expenses evenly over five years.
Costs for software for which the company does not have exclusive rights are classified as costs for computer programs and recognized evenly over five years (60 months).
The cost of the initial registration of the domain name of the website of Epizod LLC is distributed over the period of validity of the registration, that is, for 12 months, and is taken into account as part of other expenses associated with production and sales.
Every month since May 2008, the company has included 1,250 rubles in current expenses that reduce the tax base for income tax, including:
— advertising expenses — 650 rubles. (RUB 46,020 - RUB 7,020): 60 months);
— expenses for using the software product — 500 rubles. ((35,400 rub. - 5,400 rub.) : 60 months);
— registration costs — 100 rubles. ((1416 rubles - 216 rubles) : 12 months).
In April 2008, the organization recognized the costs of creating a website in the amount of 250 rubles. (1250 rubles: 30 days x 6 days).
Note. Since 2008, the concept of non-exclusive rights has not been used
Since January 1, 2008, issues related to rights to the results of intellectual activity and means of individualization are regulated by Part 4 of the Civil Code.
The exclusive right to the result of intellectual activity created by creative work initially arises from its author (clause 3 of Article 1228 of the Civil Code of the Russian Federation). The author may transfer this right to another person according to the agreement.
A citizen or legal entity who has an exclusive right to the result of intellectual activity or to a means of individualization are called copyright holders. They have the right to use such a result or such a means at their own discretion in any way that does not contradict the law (Clause 1 of Article 1229 of the Civil Code of the Russian Federation).
Article 1233 of the Civil Code of the Russian Federation states that the copyright holder can dispose of his exclusive right to the result of intellectual activity or to a means of individualization. In particular, he can:
— transfer the exclusive right to the other party (acquirer) in full under the alienation agreement (Article 1234 of the Civil Code of the Russian Federation);
— grant another person (licensee) the right to use the result of intellectual activity or a means of individualization within certain limits by concluding a license agreement with him (Article 1235 of the Civil Code of the Russian Federation).
According to Article 1236 of the Civil Code of the Russian Federation, licensing agreements are divided into two types:
- an agreement under which the licensee is granted the right to use the result of intellectual activity or a means of individualization, and the licensor retains the right to issue licenses to other persons - a simple (non-exclusive) license;
- an agreement granting the licensee the right to use the result of intellectual activity or a means of individualization without preserving the licensor’s right to issue licenses to other persons - an exclusive license.
Moreover, when concluding any type of license agreement, the exclusive right remains with the copyright holder and does not pass to the licensee.
DESIGN PHASE
What is “showcase” design and why is sometimes design a waste of money?
Before starting to evaluate the site, it is important to rebuild its structure, describe which sections will be present in it, and calculate the required number of pages. To put it simply, you need to assemble a website. For example, we think that we need a Home page and 4 internal pages - for example, a total of 5 pages.
According to the classics, the design stage comes next, but we do not always start from this stage. This is especially true for “primitive” sites. By “primitive” site we mean all sites that are created on the Internet - corporate sites, text sites, information sites, and most importantly online stores. Why don't we do it? Because design is not drawing black and white flowcharts, it is thinking through interaction, infrastructure, and most often in simple sites - this is all standard.
The result of such ostentatious design is most often the client’s money being wasted. And as a result, he receives a standard product. If this is, for example, an online store, there will be a filter, on the left, right or top - a list of products, either tabular or with a switch, line by line, and there will be a product card and on the card there will be tabs on which there will be a description of the characteristics, video and everything is the same as in a standard online store with minor variations.
In this case, the design stage is redundant. But we sell one prototype. Not in order to design infrastructure, but so that the client sees a preliminary sketch of the future design, design concept. We show the client how the site will look stylistically. Using this prototype, we work out the dimensions, distances, typography, fonts, while the client sees in black and white what the designer wants to offer.
As a beginning designer, I used to worry when I was preparing a design for a client. You have a text description of what the client wants, and you draw the final design – in color – based on this. Then you send it to the client and wait for several hours - and you think it will be an angry response, or he will like it, or it will be a scam. And you don’t know what the reaction will be.
So, in order to minimize this approach, especially when this is a real business, and not a freelancing situation. You need to standardize processes and minimize costs; you need to show the client the process in the form of a prototype. If the client likes it, good, if he doesn’t like it, it’s okay, we didn’t spend that much time... We redid it. Like. Then we draw the design.
This way, we eliminate situations where we need to completely redo the work.
Let's say the design concept of the main page contains 7 blocks. There is no point in drawing all 7 blocks if the client rejects the general style already on the first two. Then we draw only two, and if the client says ok, we start designing.
As a standard, we set 3 hours for 1 prototype.
