Compensation of expenses under a civil law agreement (GPC, GPD)

To carry out one-time work or services, a company may enter into a civil contract with an individual.

According to Article 709 of the Civil Code of the Russian Federation, the contract specifies the price, including work and services, as well as compensation for the contractor’s costs

- an individual.

Citizens working under civil law contracts can be compensated for:

• the cost of travel and rental housing;
• other expenses stipulated by the contract (payment for communication services, rental of office equipment, transport, etc.).

What can still be compensated?

Under civil contracts for the performance of work or provision of services, the contractor can count (Clause 2 of Article 709, Article 783 of the Civil Code of the Russian Federation): - remuneration for his services or work. This will actually be its economic benefit; - to compensate for their costs.

We warn the manager If you decide to compensate the contractor for his costs, then it is better to indicate in the contract separately the amount of remuneration and separately a clear list of compensated costs and the procedure for their compensation (Clause 4 of Article 709 of the Civil Code of the Russian Federation). You can also specify the limits (“standard”) of reimbursable costs. This is necessary to avoid conflicts with both the contractor and the tax authorities.

Now let’s outline this very list of compensable costs in relation to a citizen contractor. These can only be costs directly related to the execution of the contract. At the same time, goods, works and services, the cost of which your company is ready to compensate to the contractor, must be used to perform the work you need (provide services). You, of course, can compensate the contractor for the purchase of expensive equipment. But regulatory authorities (tax inspectorate and extra-budgetary funds) may reasonably consider that this is no longer compensation for costs, but a way of paying part of the remuneration or even a gift to the contractor. This means that there will be additional personal income tax and insurance premiums. After all, he can use this equipment to fulfill orders from other companies. With the same success, you can compensate the contractor for the purchase of a machine, which he also partially uses for the benefit of the customer. So, for tax purposes, it is safer to limit ourselves to compensation of expenses: - for materials, work and services necessary to complete your order. For example, a contractor purchases wood and processes it according to your needs; — for travel to the place where the work is actually performed and accommodation there . This is typical for situations when you hire a nonresident citizen and he has to get to your city and rent housing there. Or, conversely, you send a local contractor to provide services to another city.

Conclusions:

1. For personal income tax, you need to send an address request to the tax office;
2. In terms of insurance premiums , the second option is beneficial,
   when compensation for travel-related expenses is paid separately;
3. Contributions for insurance against accidents and occupational diseases must be calculated if this is provided for in the GPC agreement;
4. Regarding the inclusion of compensation for expenses under the GPA agreement in income tax expenses, it is better to send a targeted request to the tax office.

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Author: Mayorova Irina

What about compote?

That's probably all the usually reimbursable expenses. But some companies also pay private contractors a “per diem” allowance, usually in the same amount as their full-time seconded employees. Let us immediately note that daily allowances are provided only to “regular employees” sent on business trips (Articles 166, 168 of the Labor Code of the Russian Federation). And you will have a dispute with inspectors from both the Federal Tax Service (regarding the withholding of personal income tax) and extra-budgetary funds (regarding the calculation of insurance premiums). In addition, tax authorities will not allow such “daily allowances” to be taken into account when taxing profits. So it is better not to call these payments exactly per diem, but to compensate the contractor for the inconvenience of staying in another city: ( or ) under the guise of compensation for the costs of an individual contractor for food, if, of course, they are documented by the contractor. Although you are not obliged under the Civil Code of the Russian Federation to provide food for the contractor, in particular, when performing work in another locality, you have the right to assign such an obligation to yourself by contract. True, even in this case, a dispute with the tax authorities is likely, who are unlikely to consider such expenses of contractors directly related to the implementation of your contract; ( or ) increased remuneration.
That is, you simply increase it by the approximate amount of the contractor’s “overhead” costs. Then you can easily include the payment under the contract in your expenses. But, of course, you will have to pay insurance premiums and withhold personal income tax on the remuneration amount. For a similar reason, you should not compensate the contractor for “representation expenses”. Even if the subject of the contract is activities related to meetings. After all, entertainment expenses require participation of your employees in meetings, but in this case this is not the case. So such compensation cannot be taken into account when taxing profits, and personal income tax and insurance premiums will have to be charged on their amount (Clause 2 of Article 264, paragraph 6 of paragraph 1 of Article 208 of the Tax Code of the Russian Federation; part 1 of Article 7 of the Federal Law of July 24 .2009 N 212-FZ). As in the case of “per diems”, it is better not to call such payments compensation for entertainment expenses, but to formalize them as compensation for specific expenses of the contractor in fulfilling your contract (for example, for renting a hall for negotiations with potential contractors) or simply increase his remuneration.

Table of differences

The Supreme Court of the Russian Federation came to the conclusion that in a number of cases, GPAs concluded with individual entrepreneurs, which provide for monthly remuneration, compliance with labor regulations, etc., should be reclassified as employment contracts, since they are illegal and infringe on the rights of employees (definition Sun dated 02.27.17 No. 302-KG17-382). This means that companies take a big risk when they enter into GPAs, which are very similar to employment contracts.

For clarity, the main distinguishing features of these agreements are shown in the table:

When can you conclude a GPC agreement with an individual, read our article.

Income tax and tax under the simplified tax system

You can equally reasonably take into account compensation for material expenses of contractors as (Clause 4 of Article 252 of the Tax Code of the Russian Federation): ( or ) other expenses (Subclause 49 of Clause 1 of Article 264 of the Tax Code of the Russian Federation); ( or ) expenses of the same type to which the contractor’s remuneration is attributed (for example, expenses for repairing your OS (Article 260 of the Tax Code of the Russian Federation)). After all, we remember that such compensation is part of the price of the contract. This method, by the way, is most suitable for simplifications with the “income minus expenses” object. After all, they have no right to take into account other expenses (not mentioned in the closed list), but repair expenses are welcome (Subclause 3, clause 1, Article 346.16 of the Tax Code of the Russian Federation); ( or ) material expense. For example, it is quite acceptable to consider compensation for the cost of spare parts for repairs as expenses for the purchase of materials used for the maintenance and operation of fixed assets (Subclause 3, clause 1, Article 254, subclause 5, clause 1, Article 346.16 of the Tax Code of the Russian Federation). And in any case, we remember that it is necessary to obtain from the contractor documents confirming his expenses (purchase contracts, cash and sales receipts, invoices, etc.).

Attention! It is necessary to obtain from the contractor documents confirming his expenses. Otherwise, payments to him cannot be regarded as compensation for expenses.

Compensation for travel and accommodation expenses of a citizen contractor can also be taken into account: ( or ) on the same basis as the contractor’s remuneration. This is exactly the position (though in disputes over compensation to organizations, not “physicists”) that the courts take (Resolutions of the FAS UO dated 04/30/2009 N F09-2594/09-S3; FAS PO dated 03/05/2009 in case N A57-12814/ 2006); ( or ) as other reasonable expenses associated with production or sales. True, those who simplify things with the object “income minus expenses” will not be able to take into account expenses on this basis.

Note But it’s absolutely not worth taking such compensation into account as actual travel expenses! After all, only full-time employees need to be reimbursed for travel expenses (Articles 166, 168 of the Labor Code of the Russian Federation). So the tax authorities will definitely “remove” such expenses when checking your company (Letter of the Ministry of Finance of Russia dated December 19, 2006 N 03-03-04/1/844), and in addition, you will have problems with personal income tax. After all, even some courts believe that “travel payments” to non-employees should be subject to personal income tax (Resolution of the Federal Antimonopoly Service dated June 1, 2009 in case No. A12-15743/2008).

Payments under civil contracts

Author: L. V. Karpovich /expert of the magazine “Topical Issues of Accounting and Taxation”/

In every organization, situations arise when it is necessary to hire outside workers to perform a certain type of work or service.
As a rule, a civil law contract is concluded with such employees, which has advantages over a fixed-term employment contract from the point of view of tax savings. However, often the inspection authorities try to find clues in the content of the contract that would allow it to be reclassified as a labor agreement and, accordingly, additional taxes to be charged to the budget.

This article explains how to correctly draw up a civil contract to avoid such troubles, as well as how to correctly conduct accounting and taxation of such payments.

The essence of a civil contract