Entrepreneurship is a source of income for many people in our country. The importance of individual business is the higher, the more difficult the overall economic situation in the world and our state. Of course, small businesses Russian budget a lot of tax deductions, so the state is extremely interested in their support and development (theoretically). In this article, we will reveal both the essence of this concept and some principles of supporting this form of business.
Basic information
As in other legal states, the fundamental principle of economic development in our country is complete freedom of entrepreneurial activity. Every person with us can engage in activities permitted by law and receive profit from it. By the way, what is meant by the term "entrepreneurial activity"? This is an independently carried out work that is performed at your own peril and risk.
The sole purpose of small business is to regularly make a profit, which is achieved through the use of manufacturing tools, brainwork, and more. This activity is aimed at the production and sale of goods and / or the provision of services. The state supports small business for its dynamic development, which guarantees the filling of the state budget with tax deductions.
The Importance of Small Business
The most important role of this type of activity is that it acts as the main competitive factor. The principle of entrepreneurship is simple - to find some kind of society’s need and satisfy it within a specific economic or social niche. By what principle can small businesses be classified as “small”? It's all about the number of staff or employees working under temporary employment contracts.
What is meant by subjects?
These are small commercial organizations that are focused on making a profit. What is their difference from the others? The fact is that in their authorized capital should not be more than 25% of the shares belonging to the constituent entities of the Russian Federation, public, religious, and other organizations. Finally, the number of employees permanently working in them should not exceed the following standard amount:
- Thus, small businesses working in industry, transport and construction should not have more than a hundred employees.
- Agriculture and science - no more than 60 workers.
- Wholesale trade - up to 50 employees.
- Retail trade and the provision of services - about 30 people.
- Other areas of activity - up to 50 wage workers.
In addition, small businesses are all individuals who are engaged in small business, but do so without registering as a full-fledged legal entity. Important! Many believe that all such companies can take advantage of a simplified taxation method. Unfortunately, this is not the case. Regardless of the type of activity, only individual entrepreneurs and organizations that employ no more than 15 people can apply for this right.
It should be noted that many of the problems of small business are precisely the too complicated, confusing and high taxation, and therefore the number of organizations that can count on some concessions is somewhat small.
By the way, when can an enterprise be considered small at all? After all, not only the number of employed employees in the state affects the adoption of such a decision? It all depends on the amount of revenue that was received as a result of the sale of goods or / or services produced or otherwise obtained. Moreover, the size of the profit (over the last four quarters) should not exceed a thousand times the minimum wage.
State support for small businesses
As in other countries, the development of small business is stimulated with the help of state subsidies, soft loans, as well as the provision of all necessary equipment and machinery for leasing. Specifically, in the Russian Federation, small and medium-sized enterprises are supported in the following areas:
- The infrastructure necessary for the operation of small businesses and individual entrepreneurs is being formed.
- Supporting small business also consists in creating the conditions under which the above entities can use state, financial, technical and information resources on more favorable terms.
- Simplified registration procedure for entrepreneurs and small commercial organizations.
- In addition, the state supports small and medium enterprises in terms of simplification and assistance in establishing contacts with businessmen from other countries, creating mutually beneficial conditions for this.
- Various courses are organized at which employees of such organizations can improve their skills and hone their professional skills.
The financial side of the issue is provided at the expense of the federal budget, as well as money received from the budgets of the constituent entities of the Russian Federation and other sources, including funds specially created for this purpose.
Definition of small business and its essence
And now we’ll talk in more detail about what small business in Russia is. So, as we have already said, all of them carry out economic activities within the limits limited by state laws and the laws of the constituent entities of the Russian Federation. We also mentioned that the main criterion for classifying a company as “small” is a certain number of specialists who are constantly employed in production.
But there are other criteria that should be applied to all, without exception, entities engaged in small business in Russia: the amount of their authorized capital, the annual (as a rule) cash flow, and the size of the main assets of the organization.
Historical retreat
In our country, small business in the modern sense of the word was allowed only in 1988. At first, everyone was categorized as “small” state enterprises the number of employees in which did not exceed one hundred people. But two years later, in August 1990, a separate resolution was issued by the USSR Council of Ministers (the law on small business).
This document clearly disclosed which enterprises should be classified as small: in the industrial sector they were allowed to have up to 200 people, in the scientific field - up to a hundred, in other areas of production activities, organizations could have up to 50 employees, in the non-production sphere - up to 25 people. All retailers could count on only 15 employees.
Economic turnover
The volume of economic turnover was also taken into account, but the right to establish its specific value was left at the mercy of the republics. In practice, it turned out that this value was never established at the legislative level. It is from those times that the identification of small enterprises based on the number of specialists employed in them remained. At that time, support for small businesses in fact was not carried out, since the USSR simply did not have enough time to form a legislative base.
Current state of affairs
In July 2007, Federal Law No. 209 was adopted. Its text sets out all the measures that the state is taking in the field of small business development. The law provides that “those small businesses” include all those organizations that are included in the register of small businesses (excluding state and municipal enterprises). This also includes all entrepreneurs entered in the relevant register and engaged in entrepreneurial activities without forming a legal entity, as well as peasant and farm enterprises. All must comply with the conditions below.
Shareholding
Firstly, as we have already mentioned, the share of third parties in the authorized capital of legal entities should not exceed 25%. But there are two exceptions to this rule. This does not include investment equity funds. Secondly, the exception is closed-end mutual investment funds. Finally, legal entities can also be invested in the authorized capital, which generally do not belong to the category of small and medium-sized businesses, but their participation should also not exceed ¼ of the total size of the fund.
The average number of employees
All organizations included in the register of small businesses must maintain a certain quota in relation to the number of employees hired. So, the average annual number of employees for small and medium-sized enterprises should not exceed the following, legislatively fixed values:
- For medium - from 101 to 250 (inclusive) employees.
- Small organizations - up to 100 people inclusive.
- There are also microenterprises, the number of workers on which cannot exceed 15 specialists inclusive.
Revenues
The average annual revenue of the organization, moreover, this amount does not include the amount of VAT tax, should not exceed certain limit values. They are installed centrally by the Government of our country. At the same time, a selective approach is used, expressed in different rates for different small and medium-sized enterprises.
It should be remembered that these values are variable: they are set every five years according to the results of statistical studies, which can show how much the revenue for each category of small and medium-sized businesses has changed over time. Their category is determined based on the maximum values of indicators already indicated by us in the previous paragraphs. Important! The category of the subject can be increased or decreased, if only one of these values exceeds the value established by law for two calendar years, and the years should follow each other.
This stimulates the development of small business in the sense that the founders are forced to more closely monitor current legislation.
Important notes and some exceptions
All registered private entrepreneurs and farms, including farmers, during the year during which their details were entered in the respective registers, can go into the small business category under several conditions. Firstly, the number of employees should change accordingly, and secondly, the volume of revenue from the sale of goods or / and services, as well as the value of fixed assets and other material assets, can seriously change. The values of these indicators should not exceed those already considered by us in the previous paragraphs, and the term should not exceed one year from the moment of state registration.
It should be remembered that the average number of employees of small organizations and microenterprises is determined taking into account all people, including those who work part-time or use other forms of labor contracts, taking into account the working time that they actually worked.This also includes employees of all subsidiaries and branches, regardless of their number, as well as the form of small business used.
The size of the average annual revenue is determined exclusively in the manner established by the Tax Service of the Russian Federation. The book value of assets and other material assets is determined based on the Federal Law “On Accounting”.
