First, let’s find out what is generally considered advertising. This way we will understand which expenses can be classified in this category and which cannot.
The law says that advertising is information that you distribute in any way to an unknown number of people.
If you send out a product catalog to your customers, this is not advertising. After all, you know in advance who you are sending it to. Another situation: you post the same catalog in the store, and anyone can take it - this is already advertising.
The purpose of advertising is to attract and maintain interest in a product, company or event.
A sign on the facade with the name of a company is not advertising, because it does not contain advertising information and does not promote a product or seller. And if a poster on the facade of a cafe declares that here you can try the most delicious buns in the city - this is advertising.
If you are in doubt about what can be classified as advertising, look at the law.
Once you have determined whether the expense is advertising, you need to understand how much it can be taken into account.
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Concept and types of advertising expenses
The main task of advertising is to attract and maintain the attention of potential buyers to goods, works and services.
However, in order for the expenses incurred to be called advertising, they must satisfy the conditions of paragraph 1 of Art. 3 of the Law “On Advertising” dated March 13, 2006 No. 38-FZ, namely: to attract and maintain attention to the object of advertising among an indefinite circle of people in order to promote it in the market. According to para. 2 p. 2 art. 346.16 of the Tax Code of the Russian Federation, simplifications take into account advertising expenses in the same manner as income tax payers (according to the rules of Article 264 of the Tax Code of the Russian Federation). And in paragraph 4 of Art. 264 of the Tax Code of the Russian Federation provides that advertising costs are classified as non-standardized and standardized (clause 4 of Article 264 of the Tax Code of the Russian Federation).
Note! Advertising costs can only be taken into account by single tax payers with the object of taxation “income minus expenses” (clause 20, clause 1, article 346.16 of the Tax Code of the Russian Federation, letter of the Ministry of Finance of Russia dated April 20, 2010 No. 03-11-06/2/63).
Non-standardized expenses are fully taken into account for single tax purposes. Normalized items are taken into account in an amount not exceeding 1% of sales revenue, calculated in accordance with Art. 249 of the Tax Code of the Russian Federation.
Penalties and fines
In conclusion, we will talk about penalties and fines. If you pay the advance or annual simplified tax system late, then a fine of 20% of the unpaid amount will be added to the penalty (1/300 of the Central Bank refinancing rate for each day of delay or 1/150 if payment is delayed by more than 31 days). And if the tax office proves that you did not pay the simplified tax system intentionally, then the amount of the fine will increase to 40%!
If you submit your declaration under the simplified tax system late, the fine will range from 5% to 30% of your amount. In this case, the minimum fine is 1000 rubles.
In addition to penalties and fines, the tax office may block your current account. However, they are first required to send a notice demanding payment of the debt; the document will indicate the due date and the exact amount.
If for some reason you do not submit your declaration on time and do not pay the simplified tax system, try to pay the debt before the tax office discovers it.
In this case, you will not have to pay a fine, but, alas, this will not save you from paying penalties. Therefore, do not delay filling out the declaration and submit everything on time! Share with your friends!
Non-standard advertising expenses
Non-standardized expenses include:
- advertising expenses for events through the media and telecommunications networks, as well as for video and film services (including advertisements in print media, broadcast on radio and television);
- expenses for outdoor advertising, advertising stands, billboards, including illuminated advertising;
- expenses for participation in exhibitions, expositions and fairs, window dressing, sales exhibitions, image rooms, showrooms, production of advertising brochures, catalogs for products and services, including exhibited products, markdowns of goods, products that have lost their original qualities, commodity sign and service mark, and information about the company itself.
The list of non-standardized advertising expenses is closed.
Example
In the 4th quarter, Hermes LLC incurred expenses for the production of a leaflet in the amount of 8,000 rubles. The production of leaflets, like other printed advertising products, is considered a non-standardized expense (letter of the Ministry of Finance of Russia dated March 16, 2011 No. 03-03-06/1/142). Expenses will be fully taken into account when calculating the single tax on the basis of clause 4 of Art. 264 of the Tax Code of the Russian Federation as non-standardized advertising expenses.
Standardized advertising expenses
Standardized advertising expenses include:
- expenses for the purchase of prizes for drawings during mass advertising campaigns;
- other expenses not related to non-standardized advertising expenses.
Other expenses may include any advertising expenses not specified in clause 4 of Art. 264 Tax Code of the Russian Federation. At the same time, they will be taken into account as part of the normalized advertising costs in an amount not exceeding 1% of revenue calculated in the manner provided for in Art. 249 of the Tax Code of the Russian Federation.
Example
Expenses for carrying out a promotional campaign for tasting advertising products are included in the normalized advertising expenses, classifying them as other advertising expenses (clause 4 of Article 264 of the Tax Code of the Russian Federation, letter of the Ministry of Finance of Russia dated August 16, 2005 No. 03-04-11/205).
Check whether you have correctly taken into account advertising costs under the simplified tax system using a ready-made solution from ConsultantPlus. If you don't have access to the system, get a free trial online.
When to consider consumption
The general rule for writing off expenses on the simplified tax system is this: you can take into account the expense only when you have received and fully paid for the product or service.
On June 10, you paid 20 thousand rubles for website promotion services. A month later, on July 10, the company completed the task and you signed the act. Take into account 20 thousand rubles in expenses on July 10.
This rule applies to both regulated and non-standardized expenses. But remember that you can write off normal expenses throughout the year as your revenue grows. So that expenses do not exceed 1% of revenue for the same period. For convenience, the normalized expense can be written off at the end of each quarter - until you fully take into account the costs or the year ends.
How to confirm consumption
Be sure to save documents that confirm advertising costs. If the tax office asks you to confirm the expense, but you cannot, they will charge additional taxes and fine you. The more money you spend on advertising, the more seriously you will take the paperwork.
Build this package:
- Agreement or invoice agreement. It should say what kind of advertising you are buying. The more details, the better. The agreement is optional, but with it the tax authorities will understand what kind of advertising you paid for, and it will be easier for you to explain its benefits for business.
- An act or other document that confirms the provision of services. List in detail the services that were provided to you. If the company that provides advertising services does not issue receipts, then to confirm the expense, use an email confirming that the services were provided. Print it out and have it certified with your signature and seal, or better yet, with a notary.
- Payment document. This could be a bank account statement or a cash receipt.
For example, you place contextual advertising through Yandex.Direct. You are given an invoice which you pay. Based on the results of your work, you receive an act and a report with visit statistics. These documents are sufficient to confirm the expense: invoice, payment and report. Here you can add an offer agreement from the Yandex website.
Rules for recording advertising expenses under the simplified tax system
The procedure for accounting for advertising expenses for organizations on the OSN and the simplified tax system is the same (paragraph 2, paragraph 2, article 346.16, article 264 of the Tax Code of the Russian Federation). However, with one amendment: advertising expenses under the simplified tax system are recognized after their actual payment (clause 2 of article 346.17 of the Tax Code of the Russian Federation).
Advertising expenses for accounting purposes are recognized as expenses for ordinary activities as commercial expenses (clauses 5, 7 of the Accounting Regulations “Expenses of Organizations” PBU 10/99).
Advertising costs are reflected as part of sales expenses in the debit of account 44 (instructions for using the Chart of Accounts for accounting financial and economic activities of organizations, approved by Order of the Ministry of Finance of Russia dated October 31, 2000 No. 94n).
For accounting purposes, there is no need to normalize advertising costs. They can be fully included in the costs of the reporting period in which they were incurred, if this is fixed by the accounting policy (clause 9, clause 20 of PBU 10/99).
EXAMPLE FROM JUDICIAL PRACTICE
The company posted advertising information.
However, the advertisement simultaneously indicated the telephone numbers of another taxpayer - an individual entrepreneur. The entrepreneur, in turn, did not bear advertising expenses. The inspectorate found the expenses to be unjustified.
In the ruling of the Supreme Court of the Russian Federation dated January 14, 2016 No. 302-KG15-17861, the court recognized the costs as truly unjustified. The courts came to the conclusion that the amount of costs for renting premises and paying for advertising services declared by the company for tax purposes was economically unjustified, since these expenses are associated not only with the financial and economic activities of the company itself, but also with the business activities of the individual entrepreneur Borisova S. Yu. Tax the benefit may be considered unjustified, in particular, in cases where, for tax purposes, transactions are taken into account not in accordance with their actual economic meaning or transactions are taken into account that are not due to reasonable economic or other reasons (business purposes).
This situation can be avoided if:
- enter into a partnership agreement with a counterparty and divide advertising costs accordingly;
- advertise only your own goods and services without advertising of third parties.
GOOD TO KNOW
Sending out booklets to specific addresses, indicating your full name, is not advertising. recipients. Also, signs and indicators that do not contain advertising information, as well as information placed by virtue of legal requirements or because it is so accepted, are not advertising.
Calculation of the maximum amount of standardized advertising expenses
As mentioned, standardized advertising expenses can be included in costs in the amount of no more than 1% of sales revenue calculated according to Art. 249 of the Tax Code of the Russian Federation (subparagraph 20, paragraph 1, article 346.16, paragraph 5, paragraph 4, article 264 of the Tax Code of the Russian Federation).
IMPORTANT! When calculating the standard within which certain types of advertising expenses can be taken into account, taxpayers using the simplified tax system take into account the proceeds received from sales (clause 1 of Article 346.17 of the Tax Code of the Russian Federation) and the amount of advances received from buyers (letter of the Ministry of Finance of Russia dated 11.02) as part of income .2015 No. 03-11-06/2/5832).
Example
Vyuga LLC placed advertising posters in public transport in the 1st quarter. The cost of the service was 32,200 rubles. The company's sales revenue for the 1st quarter is 578,000 rubles.
Let's calculate the maximum amount of standardized advertising costs:
578,000 × 1% = 5,780 rub.
Consequently, normalized advertising expenses in the amount of 5,780 rubles can be included in the actually incurred expenses based on the results of the 1st quarter.
Thus, only a small part of the expenses incurred was included in expenses for tax purposes under the simplified tax system. The tax base under the simplified tax system is formed on an accrual basis from the beginning of the year (clause 5 of article 346.18 of the Tax Code of the Russian Federation). Consequently, with an increase in the volume of accumulated revenue, the size of the maximum amount of normalized advertising expenses to be included in the costs of the “simplified” tax will also increase.
During the reporting period, you can gradually include excess advertising expenses in the organization’s expenses for tax accounting. The remaining expenses cannot be carried over to the next year.
Example
Aphrodite LLC conducted an advertising campaign in the 1st quarter of 2021 to attract new clients through free cosmetic procedures. Information about the promotion was posted on the Internet, the cost of placement was 9,870 rubles. The cost of free cosmetic procedures was 86,400 rubles. Amounts are shown excluding VAT. There were no other advertising expenses in the current period. Expenses for advertising on the Internet are included in the expenses for holding an event through telecommunication networks, since the Internet is recognized as a public telecommunications network (letter of the Ministry of Finance of Russia dated 04/05/2010 No. 03-11-06/2/48, dated 07/15/2009 No. 03-11 -09/248, dated January 29, 2007 No. 03-03-06/1/41). Consequently, such expenses are not standardized and are recognized in full in the 1st quarter of 2020 (clause 4 of article 264 of the Tax Code of the Russian Federation).
Standardized expenses include expenses for free cosmetic procedures (clause 4 of Article 264 of the Tax Code of the Russian Federation). Consequently, the amount of expenses accepted for tax accounting should not exceed 1% of revenue.
- Calculation for the 1st quarter of 2021:
Volume of proceeds received from sales: RUB 427,580.
Limit value of standardized expenses: 427,500 × 1% = 4,275 rubles.
Amount of recognized standardized expenses: RUB 4,275.
Amount of recognized non-standardized expenses: RUB 9,780.
The amount of the carryover balance of normalized advertising expenses: 86,400 – 4,275 = 82,125 rubles.
- Calculation for the first half of 2021:
Volume of proceeds received from sales: RUB 947,300.
Limit value of standardized expenses: 947,300 × 1% = 9,473 rubles.
The amount of recognized standardized advertising expenses: RUB 9,473.
The amount of the carryover balance of normalized advertising expenses: 86,400 – 9,473 = 76,927 rubles.
- Calculation for 9 months of 2021:
Volume of proceeds received from sales: RUB 1,458,700.
Limit value of standardized expenses: 1,458,700 × 1% = 14,587 rubles.
The amount of recognized standardized advertising expenses: RUB 14,587.
The amount of the carryover balance of normalized advertising expenses is 86,400 – 14,587 = 71,813 rubles.
- Calculation for 2021:
Volume of proceeds received from sales: RUB 2,248,500.
Limit value of standardized expenses: 2,248,500 × 1% = 22,485 rubles.
The amount of recognized standardized advertising expenses: RUB 22,485.
Remaining normalized advertising expenses: 86,400 – 22,485 = 63,915 rubles.
Aphrodite LLC will be able to take into account expenses for tax purposes under the simplified tax system for 2021 22,485 rubles. expenses for free cosmetic procedures and 9,870 rubles. expenses for holding an event via the Internet. The amount of advertising expenses is 63,915 rubles. will remain not included in expenses, and it cannot be transferred to the next tax period.
In the book of accounting for income and expenses, advertising costs are reflected in column 5 “Expenses taken into account when calculating the tax base”, section I “Income and expenses”.
For information on the procedure for filling out the book of income and expenses, read the article “The procedure for filling out the KUDiR under the simplified tax system “income minus expenses”.”
The following entries will be made in accounting:
- Dt 44 Kt 10 - cosmetics were written off for advertising procedures.
- Dt 44 Kt 70 - wages were accrued to employees for carrying out advertising procedures. Document - payroll.
- Dt 44 Kt 60 - reflects the cost of the service for placing a promotion on the Internet. Document-basis: act of acceptance and delivery of services provided.
- Dt 90.2 Kt 44 - the cost of the advertising campaign has been written off. Document: accounting statement-calculation.
Results
Only single tax payers with the object of taxation “income and expenses” can recognize advertising expenses when calculating the single tax. Non-standardized expenses can be taken into account when calculating the single tax in the full amount of paid advertising costs, and normalized expenses can be taken into account only within 1% of the revenue received and advances received in the reporting period.
About the nuances of reflecting expenses and the requirements for expenses, read the article “Accounting for expenses under the simplified tax system with the object “income minus expenses” " .
Sources:
- Tax Code of the Russian Federation
- Law “On Advertising” dated March 13, 2006 No. 38-FZ
- PBU 10/99, approved. by order of the Ministry of Finance of Russia dated May 6, 1999 N 33n
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