Coronavirus tax holidays extended: to whom and what deadlines were postponed

Tax holidays for individual entrepreneurs in 2020-2021 are one of the types of legal tax savings. Which businessmen have the right to use them and what is their essence? How can regions limit entrepreneurs from using tax holidays? What nuances should be taken into account when calculating the share of income from preferential activities? What to do with insurance premiums and reporting during the holidays?

Reasons for extending tax holidays

Tax holidays have been in effect since 2015. They were originally planned until 2021. But due to economic fluctuations in the country, they were repeatedly extended. In 2021, the reason for extending tax holidays has again appeared - the spread of coronavirus infection, as a result of which a pandemic was declared throughout the world. Entrepreneurs in many areas of activity temporarily stopped working, which could not but affect the economic situation.

“Panic sentiment” among entrepreneurs further worsened the situation. Many began to be afraid to open their own business so as not to incur losses. To support “young” entrepreneurs and attract new taxpayers, the Government decided to extend the tax holiday. They are focused primarily on small businesses.

Conditions for using the grace period

Tax holidays are a period during which entrepreneurs have the right to work with zero tax rates.

Preferential conditions are provided for “simplified” entrepreneurs and individual entrepreneurs with a patent who registered as entrepreneurs for the first time. There are requirements regarding the type of activity:

• Production of goods;
• work in the field of science;
• social sphere;
• provision of household services to the population;
• Providing the population with places of temporary residence (hotels, hotels).

It is worth noting that types of activities can be established on an individual basis. You need to check with local authorities about which ones operate in a particular region.

These categories of taxpayers are allowed to use zero rates if they register as individual entrepreneurs before January 1, 2024. The right to provide benefits has been transferred to regional authorities.

Another condition for using tax holidays for individual entrepreneurs in 2020 is that the share from the sale of goods, services or work is 70% or more of total income. That is, profit from preferential activities should prevail in the total profitability.

Tax holidays for individual entrepreneurs are valid for two tax periods.

What are the benefits and where do they apply?

Tax leave for entrepreneurs is one of the types of government support. In the first stages of running your own small business, when it is not yet entirely clear whether everything will go according to plan and whether the business will become profitable, the obligation to make contributions to the state budget can be disastrous.

To help new businessmen, the government has developed a number of legislative acts that exempt them from paying taxes for a certain period of time. However, in order to fall under the law, a number of mandatory requirements must be met. Next, we will look at who is granted tax holidays, what conditions and tax grace periods exist for newly opened individual entrepreneurs.

Leave to the Federal Tax Service is not an absolute deferment from all payment obligations. You will not have to pay only the basic tax on a patent or the simplified tax system. The entrepreneur must make other calculations as usual. This includes insurance contributions from wages, personal income tax, transport duty, property tax, according to its cadastral valuation, etc.

A detailed set of rules regarding the application of reducing the financial burden is described in the relevant legislative acts for “simplified” - this is Article 346.20 of the Tax Code of the Russian Federation, for the PNS - 346.50. Please note that in order for a businessman to take advantage of the benefits provided, the latter must also be established at the regional level.

A beginning entrepreneur has a guaranteed right to use the 0 rate only for a limited time - two tax periods from the date of registration. The duration of the latter depends on which taxation system he has chosen. For a simplified one it is one year, for a patent one – from 1 month to a year.

In order to be freed as much as possible from mandatory payments to the treasury, it is necessary to register an individual entrepreneur in the first weeks of January. Please note that according to recent amendments to the Tax Code of the Russian Federation, the holiday will be valid until the end of 2023. Therefore, in order to get the greatest benefit for himself, a businessman must register his business no later than the beginning of 2021.

Restrictions

Local authorities have the right to independently determine restrictions that apply to the activities of entrepreneurs using tax holidays:

• the number of employees;
• profitability.

Important! Tax holidays apply only to the simplified taxation system and special taxation system. If an entrepreneur works on several taxation systems, according to others he pays the tax in full.

Despite the temporary exemption from tax, insurance premiums must be paid throughout the tax holiday period - contributions are made to the Pension Fund for yourself and for employees. It is also important to understand that at the end of the year a declaration is submitted indicating a 0% tariff. Tax holidays are valid until 01/01/2024.

“Young” entrepreneurs have enough time to register with the Federal Tax Service and save money.

Types of preferences

Having found out whether there are tax holidays for beginning individual entrepreneurs (IP), how long they last and to whom they apply, you must also take into account the type of activity that you will be engaged in.

1. When using a simplified taxation system, the following operate: agricultural enterprises, workshops for the production of semi-finished products and food products, footwear and light industry, woodworking and wood products, pulp and paper industry, chemical sector, production of rubber and plastic products, metallurgy, automobile production, equipment, education, healthcare, tourism, research activities.
2. Those to whom the 1 percent rate applies: spinning cotton threads, preparing textiles and fabrics, sewing children's clothing and accessories, making wooden parts, toys, educational games, ceramic accessories, cork products and other folk and artistic crafts.
3. A rate of three percent is levied on: cultivation of vegetables and mushrooms, seeds, berry crops, fishing, raising seedlings, livestock, beekeeping, making canned fish, shellfish, etc., production of fermented milk and cheese products, preschool education, work of guides and tour guides, operation sanatorium and resort complexes, providing social assistance to vulnerable segments of the population.
4. When using the patent system, the following work works: repair and tailoring of shoes and clothing from various materials, maintenance of machinery and equipment, furniture restoration, services of photo studios and salons, film laboratories, training, tutoring, care services for the disabled, children, the elderly, folk art products, carpet manufacturing, cook services, pharmaceutical industry, rental services, forestry, dairy production, logging, drying of fruits and vegetables, activities related to translation and interpretation, production of bakery products, PC program development services, repair and maintenance of computer equipment , furniture production, etc.

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Is there a benefit for re-registered individual entrepreneurs?

Consider the following situation. The entrepreneur stopped his activities, and then decided to register as an individual entrepreneur again. Moreover, he did this after the law on tax holidays was approved. Is it possible to take advantage of the benefit in this case or does it not apply to those who register again?

Initially, Letter No. 03-11-11/40882 dated July 12, 2021 stated that tax holidays cannot be used by individual entrepreneurs who suspended their activities and then re-registered as individual entrepreneurs.

But the Supreme Court refutes these data. According to his decision, entrepreneurs who were previously registered as individual entrepreneurs, then ceased their activities, then resumed them after the approval of tax holidays, are not excluded from the list of “beneficiaries”. Each case is considered individually.

Of course, all individual entrepreneurs receive the right to tax holidays in 2021 and beyond only if they meet the stated requirements.

How long do preferences last?

If you already know what this means - tax holidays (benefits) for newly opened individual entrepreneurs under the simplified tax system, then you are probably asking yourself a new question: for how long is a beginning entrepreneur exempt from taxes. So, the interval for simplifiers is 2 24 months and for PSN two patent validity periods. In this case, the year when you registered the organization is considered to be the initial period of time.

You should also know that it will no longer be possible not to pay contributions to the state from 2023, however, if you managed to complete the documents before the end of 2022, then the grace period will last the entire expected period, including 2023.

Let's consider an example that you started working for the simplified tax system at the beginning of 2021 and are eligible for a tax holiday. The second payment for you will be the whole of 2022. If the registration date under the same conditions fell in October last year, then the first payment deadline will still fall in December. Accordingly, it is simply unprofitable to start operations in the fourth quarter.

Vacations for the owner of an enterprise on PSN can be much more modest. One tax period is equal to the period of validity of a patent issued for a period from 1 month to a year. That is, if a businessman received a six-month period twice, then his exemption from mandatory payments will last exactly one year, if immediately for 6 months, and then for the same amount - respectively, 12.

How to take advantage of tax holidays

In order to join the ranks of “beneficiaries” and pay tax at a 0% rate, individual entrepreneurs using the simplified tax system or PSN do not have to submit any special documents. Immediately after registration with the Federal Tax Service or within 30 days after registration, a standard application is submitted according to f. 26.2-1 or 26.5-1 (depending on which taxation regime is planned to be used). The 0% tax rate is indicated when submitting the declaration.

Note! If you make advance payments during the year, even if the individual entrepreneur had the right to a tax holiday, it will not be possible to return the funds spent. You will have to file a tax return showing the interest rate at which the payments were made.

List of subjects of the Russian Federation

Currently, only a few regions have extended the preferential rate until 2024. For others, this issue is under active discussion. In Moscow itself and the Moscow region there is still no accurate information about the extension of tax holidays. According to official data, the preferential treatment in the capital and district ends on December 31, 2020.

Detailed information is in the table. Of course, this is not final data. The list will be updated as new information becomes available.

Regions that have decided not to introduce preferential treatment on their territory have the right to do so legally. In this case, entrepreneurs are deprived of the opportunity to apply a 0% rate, even if all conditions are met.

Patent changes

The tax system is constantly undergoing changes, and from the latest innovations on patents, regions can now limit the application of this system on their territory. Patents are intended only for individual entrepreneurs.

The number of employees in this case cannot be more than 15 people, and annual income is limited to 60 million. And not everyone can use this system, but only representatives of a certain field of activity.

In 2021, the list of areas for which a patent is issued should increase. Another advantage will be the deduction of the insurance premium from tax payments. In any case, details about what tax holidays for individual entrepreneurs will be like for Moscow, types of activities and their features should be discussed separately in each region.

Interesting fact: according to recent studies, 76% of Russians want to have their own business, but at the same time they are very afraid of high taxes, the fact that it won’t work out, and new legislation. Moreover, taking into account the fact that 71% of existing entrepreneurs say that business conditions in Russia are not entirely favorable. However, the state is taking measures to develop business.

Accounting for income and expenses during tax holidays

Despite the tax rate being calculated at 0%, entrepreneurs are required to keep records of income and expenses in a special journal (KUDiR). According to Order of the Ministry of Finance No. 135n, a businessman reflects in this document the reliability, continuity and completeness of his activities. The tax base is determined from the accounting log, which in this case is necessary for calculating insurance premiums.

The advantages of KUDiR are obvious even during the grace period:

• the procedure for filling out the KUDiR involves the daily recording of monetary amounts, which is not directly related to the calculation of tax (for example, this helps to determine the revenue limits allowed for the simplified tax system);
• if KUDiR is absent from the workplace, the entrepreneur faces penalties of 10,000 rubles.

Data from KUDiR, first of all, is required by the entrepreneur himself.

What should those individuals do who did not know about the vacation and have already paid their fees?

There are no clear recommendations providing an answer to this question in the current legislation. It is believed that if a person did not know about the tax grace period for individual entrepreneurs and has already paid the bills, he has the right to submit an updated declaration with a 0 rate and return the funds paid. To do this, you must attach explanatory documents confirming your right to become a beneficiary. Keep in mind that representatives of the responsible service will carefully check this information, not wanting to simply return the money. If we talk about PSN, the matter is much more complicated. After all, you have already applied and paid a certain amount for the patent. In this case, it is recommended to seek detailed advice from the nearest Federal Tax Service department.

Is it possible to save on insurance premiums?

Taxes carry a serious financial burden for any businessman. However, during the tax holiday for individual entrepreneurs for 2021 and subsequent years, insurance premiums will have to be paid. The benefit does not apply to them. This means that during the year you will have to make insurance contributions according to the same scheme as before. This applies equally to payments for yourself and employees.

The government explains this as follows: individual entrepreneurship is not only a way to make money, but also involves certain risks. In particular, employees of an enterprise should not lose contributions to the Pension Fund and other contributions if the employer temporarily works at a preferential rate.

Examples of calculations

Let's look at how to calculate tax for different types of activities.

Example 1

The individual entrepreneur is registered in a region in which tax holidays apply. “Simpler” chose “Income minus expenses” as the object of taxation, but is engaged in different types of activities. Some qualify for preferential treatment, others do not.

Based on the results of work for the calendar year, the profit amounted to 9,890,000 rubles. By type of activity, “net” income was distributed as follows:

1. 7,500,500 rubles (preferential type of activity).
2. 1,078,540 rubles.
3. 1,310,960 rubles.

First, let's calculate the share of profit from preferential activities:

7,500,500 / 9,890,000 = 0.758. That is, 75.8%.

This figure exceeds the maximum norm of 70%, so the entrepreneur has the right to count on benefits. He does not calculate tax on the first type of activity, since the rate on it is 0%.

Example 2

An entrepreneur earned 10 million rubles during the tax period (calendar year). "net" profit. Of this, earnings from preferential activities amounted to 6,500,000 rubles.

Calculation of the percentage of profit on the benefit:

6,500,000 / 10,000,000 = 0.65 or 65%.

This is less than the established minimum, so the individual entrepreneur is not entitled to a 0% rate. The entrepreneur calculates the tax amount according to the standard tariff.

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