Material assistance is an employee’s income, but it is paid voluntarily. Depending on the size of the amount and purpose, the funds can become a tax base. Let us consider in more detail whether personal income tax is subject to financial assistance.
Definition
Clear definition of the term material assistance in the Russian legislation no. But the procedure for providing funds is described in detail in regulatory enactments. All cash payments are divided into:
- state and municipal (from the FSS, the Pension Fund, etc.);
- local (from the employer).
Legal regulation of the payment of funds to citizens who find themselves in a non-standard situation is carried out on the basis of local federal laws and collective labor agreements. Material assistance is one-time and regular, paid in cash and in the form of values. Salary is subject to personal income tax. A lump sum is also part of employee income. Is personal income tax paid? Yes, but not always.
Material assistance is a one-time payment, which is carried out on the basis of the order of the head. If several orders are issued on the same basis, then only the first amount will be recognized as lump sum, and for the rest you will have to pay personal income tax.
Grounds
Companies that value employees introduce additional incentive measures. For example, this is the payment of help. The organization may allocate part of the funds from its budget to the employee in order to overcome force majeure situations. The basis for receiving payment may be:
- birth (adoption) of a child;
- death of a close family member;
- wedding;
- the occurrence of serious health problems;
- fire and other disasters.
Material assistance is different from wages: it does not depend on the indicators and results of the employee’s activities, does not compensate for his production costs, does not reward for achievements. This is not part of the motivation; it is paid once in case of emergency.
Are personal income tax levied on material assistance amounts? Yes, but not always. Therefore, the accountant needs to be careful when processing related documentation. Funds are allocated from the net profit of the organization. If the recipients are full-time students of the university, then a special fund of 1/4 of the scholarship fund is used as a source.
Is personal income tax levied on employee benefits in the form of material assistance in 2017?
The procedure for calculating tax in 2017 has not changed. The help is temporary. It does not depend on the professional activities of the employee. The purpose of the type of cash payment is spelled out in the order of the head. To justify this operation, you need to get a statement from the employee and copies of supporting documents. In addition, the possibility of obtaining help should be spelled out in the local acts of the enterprise. Incorrect wording of the operation may re-qualify the payment in labor, which will lead to additional accrual of personal income tax. For example, maternity assistance for the holidays will be interpreted as bonuses for work.
When is tax deducted?
The legislation defines a list of situations in which the transfer of funds can be attributed to material assistance. This is done in order to prevent abuse in calculating personal income tax.
Payout Criteria
- The size. The amount of payments per employee for the entire reporting period should be less than 4,000 rubles.It does not matter if the person continues to work or was fired due to disability, reaching retirement age.
- the confirmation. In order not to pay tax, the organization must prove that the situation for the solution of which the funds were directed, really took place:
- If the employee received payment in connection with the loss of a relative, then he must provide a death certificate.
- If an employee had a child born (adopted), then he must provide a birth certificate (adoption).
- If a person was injured during a terrorist attack on the territory of the Russian Federation, you need to provide a police certificate confirming this fact.
- If an employee’s health was damaged as a result of a natural disaster, then documents from the competent authorities are needed.
- Special circumstances. Events such as the death of a family member or an emergency are grounds for not accruing personal income tax. But as proof, you must provide documents. If the tax considers the submitted documents insufficient, it may tax the payment.
When is the tax not withheld?
Is personal income tax always taxable? Funeral, birth of a child, retirement - upon the occurrence of this or any other event in a person’s life, the employer can provide a lump sum payment to the employee. If you adhere to certain rules, you will not have to pay additional taxes.
According to Art. 217 of the Tax Code, not all social payments are subject to taxation. One-time transfers of funds to officially registered charitable companies are not subject to taxation. As well as financial support for the victim in natural disasters and terrorist acts. Is financial assistance imposed on the burial of personal income tax? No, provided that we are talking about a former employee of the company, a member of the work collective, or a former employee-pensioner whose close relative died. Moreover, the maximum payout amount is not limited in any way.
Is personal income tax paid if the funds are paid out of the budget? No, if we are talking about transferring money to poor people. This category also includes the payment of maternity capital, which comes from the budget.
Is personal income tax imposed on personal assistance to an employee or a former employee if the amount of payment for the tax period does not exceed 4 thousand rubles? Not. Personal income tax is levied on excess of this amount at a rate of 13%. Compensation of expenses for medical services, including payment of vouchers for spa treatment, is also included in the exclusion list.
A special case
Is personal income tax paid when it comes to a lump sum payment to a member of the labor collective whose child was born? No, if the amount of material assistance does not exceed 50 thousand rubles. In this case, payment can be made both to one of the spouses, and to both at once. If the amount exceeds the specified limit, you will have to pay personal income tax.
This payment should be considered separately. Firstly, often in collective bargaining agreements such compensations are called the “birth bonus”. As already mentioned earlier, an incorrect formulation of the operation can re-qualify the payment from mother aid to any other. Therefore, in the collective agreement and the order for the transfer of funds, it must be indicated that it is a matter of material assistance.
Secondly, the payment is limited to the amount of 50 thousand rubles. If parents work in different organizations, then management may request a certificate from an employee confirming the fact of receiving second aid by the second parent. Officials say that there are no special requirements in this regard. The Finance Ministry believes that it is better to play it safe and get a certificate of income of the second parent. If he is not employed, then you can provide a copy of the employment certificate or a certificate from the employment service.In some regions, tax authorities accept a statement from a second parent about the lack of material support.
If, however, to the payment received by one employee in connection with the birth of a child on the basis of a new order, an additional payment is made, then it will no longer be considered a lump sum. With this amount will have to withhold personal income tax. This payment to the employee must be included in the payroll sheet. The document should also reflect all such payments, put the signature of the cashier and the seal of the organization.
BOO
Let us consider in more detail how taxation of material assistance to personal income tax is carried out in accounting. Amounts given relate to other expenses for the current period. But they are not taken into account when calculating income tax or STS. Consider typical wiring:
- DT91 KT73 - allocation of help to other expenses.
- DT91 KT69 - reflection of contributions under ЕССС for amounts exceeding the limits of material assistance.
- DT73 KT68 - withholding personal income tax from amounts exceeding the limits for material assistance.
- DT73 KT50 - delivery of help to an employee “on hand”.
The report 6-NDFL on pages 020 and 030 should indicate only those payments that are subject to taxation in full or in part.
WELL
Having dealt with whether personal income tax is subject to financial assistance, let us consider in more detail how this process is carried out in NU. The organization is obliged to calculate the amount of tax on the day the funds are paid. The funds must be transferred to the budget on the day of receiving cash from the bank. Therefore, the algorithm of actions is as follows:
- accrual of mother aid;
- retention of personal income tax;
- issuing funds from the cash desk or transferring money to a card;
- transfer of tax to the budget.
Conclusion
An organization may pay a lump sum cash payment to its employees that is not related to the performance of their labor duties. Is personal income tax paid? Yes, provided that the amount of the payment exceeds 4 thousand rubles. Also, the legislation spells out individual cases when material assistance is not taxed. The availability of conditions for payment of material assistance should be documented. In the absence of a certificate, application or order of the director, the tax authority may consider the payment unlawful and charge additional personal income tax.
