In our life, the word "advance" is quite common. What can this term mean, where it mainly occurs? This is a very relevant topic today.
It’s worth starting with the fact that in the Labor Code the very concept of “advance” is absent. Article 136 stipulates that salaries are mandatory every two weeks. Therefore, you can safely define an advance as a salary accrued for the first worked half of the month. The advance payment algorithm should be spelled out in the organization’s charter documents, such as a collective agreement and labor schedule, or specified in the labor agreement.
Minimum wage
In Russia, the minimum wage (abbreviated as minimum wage) is set at the level of federal law. This is the minimum below which wages cannot be, because this will be a violation of the law. Do not confuse the minimum wage and the cost of living, which is set depending on the cost of the grocery basket needed by a person to meet his minimum needs. This indicator helps to assess the standard of living. The definition of the minimum wage is also based on it.
In each region of our country, the living wage indicators differ. Usually it is approved for a period of three months. The minimum wage is taken for one year and may differ in size from the cost of living.
Payment terms
Since October 2016, some changes have been made to the labor legislation regarding the timing of salary payments. According to the new rules, payment dates should be written in the company's internal documents. Payment takes place within 15 calendar days from the end of the period for which it is charged to the employee. Thus, earnings for July, for example, should be accrued no later than August 15th. And the advance, respectively, no later than the last day of the current month (no later than July 31). Thus, charges are strictly regulated by law. How to determine the size of the advance? About it further.
Specific date
The law does not provide for a specific date for calculating the funds that make up an advance or a salary. The Labor Code defines only the time intervals between payments, and the exact dates are determined by each organization independently. However, Rostrud experts recommend paying an advance in the middle of the month, since the completion of this operation at the end of the month may violate the rights of the employee and the Labor Code. After all, if an employee started work in the first days of the month, then more than 15 days will pass before receiving the advance payment.
The exact date and period of the advance payment should not be confused. Some organizations determine the advance period from 15 to 20, for example, and wages from 1 to 5. The Ministry of Labor considers such options for setting payment deadlines to be incorrect, since under certain circumstances a break in accruals may be more than a crescent, and recommends setting exact days. If the payment date falls on a weekend or holiday, accrual should be made the day before.
Amount of advance accruals
Advance is a concept that is often used in relation to wages.
The Labor Code, as already mentioned, does not mention the concept of “advance”. But it spells out some payment rules adopted back in the Soviet years. They are valid and to this day do not contradict the Labor Code.One of these provisions says that the amount of wages received in the first half of the month is calculated on the basis of an agreement between the employer and the trade union organization and should be prescribed in a collective agreement. The amount of advance accrual should not be less than the employee’s tariff rate for the worked period. That is, a person receives an advance not as a percentage of all wages, but as payment for actually worked days.
It is also necessary to take into account the fact that, as a rule, an advance is only part (usually less) of wages. Therefore, when calculating it, various allowances are also taken into account (for working conditions, for an additional amount of work, for combining posts, for replacing a temporarily absent employee). However, incentive bonuses are not taken into account when calculating the advance payment, since for their calculation it is necessary to take into account the employee’s work for the whole month. The resulting value should not be less than forty percent of the basic salary.
The essence of the advance is now clear.
Accrual and issue
By law, it is believed that an employee receives wages on the last day of each month. Therefore, the advance payment is reflected only in the statements. In the accounts of accounting until the end of the month no accruals will be made. After the advance payment is issued, a receivable is formed, which is repaid with payroll to the employee.
The advance payment does not issue settlement statements, only for wages at the end of the month. When calculating taxes, it is also not taken into account in expenses.
How can I get it?
An advance can be received both in cash and in a bank account. In the first case, you need to fill out a payroll (form T-53) or a cash register for expenses (form KO-2). When transferring an advance (a sample will be presented below), the purpose of the payment must be indicated on the bank account.
Personal income tax is not withheld from advance payment. It is levied only on wages at the end of the month from all accruals made for a specific period. Contributions to non-state funds are also made out of advance. The same goes for health insurance. However, if an advance is charged at the end of the month, then personal income tax is transferred on its basis.
Social contributions
Depending on the amount accrued to the employee as a salary, the organization must calculate and make various social contributions from its own funds:
- Pension fund contributions of 22 percent.
- Compulsory health insurance contributions of 5.1 percent.
- Contributions to social insurance against injuries (depending on the field of activity).
Funds are charged when calculating wages no later than the middle of the month following the reporting month.
Nuances
What is this advance payment? This question is asked quite often.
As in any business related to the accounting sphere, there are several important nuances in the payment of an advance payment, which should not be forgotten either by the employee or the employer.
In a letter to 2006, Rostrud clarified that when an employee is on vacation or is absent for other reasons, he should calculate an advance based on the days worked for the first half of the month. That is, an advance will be accrued to the employee if he worked for at least one day in the first half of the month in question. If, until the 15th day of the billing month, the employee did not go to work, no advance payment will be charged.
Advance payment is now required.
An advance cannot be paid, even if the employee expresses such a desire. This is contrary to the norms and rules prescribed in the labor legislation of the Russian Federation. Even if an employee works concurrently with the main position, he needs to pay wages twice a month. Violation of this clause of the Labor Code of the Russian Federation will entail administrative penalties in the form of fines or disqualification.
Advance payment
The payment of wages less than the number of times prescribed by law may be qualified by the court as untimely payment of funds. An employee of the organization has the right to receive compensation for each day of delay. The amount of such should be at least 1/150 of the Central Bank's rate of unpaid amounts at the appointed time, starting from the day following the specified accrual period, to the day of actual settlement. Therefore, if your employer commits a violation of the Labor Code when calculating advance payments and wages, this may serve as a reason for contacting the labor commission or directly to the court.
What is this advance payment? We have answered this question.