Payroll related taxation and obligatory reports

The employer must pay wages to employees on time. At the same time, he has additional responsibilities related to the calculation and payment of personal income tax, as well as insurance contributions.

In this article, you will learn what payments the employer must make and what reports should be submitted to the Tax Authorities and Funds.

Payroll taxes, which the employer must calculate, withhold, and transfer to the budget, can be divided into two large groups. The first one includes the amounts that are transferred at the employee’s expense. These payments are deducted from the salary when it is paid, and the employee actually receives less than it was accrued before tax. And the second group of mandatory deductions includes those amounts that are transferred at the employer’s expense.

Group 1: Deductions at the expense of employees

This is a tax on personal income, which is deducted from the remuneration of employees. Personal income tax (PIT) must be deducted from the wages of employees who are citizens of the Russian Federation and permanently reside in Russia at the rate of 13%. Such an employee receives 13% less than the amount specified in the employment contract in general. The company should determine the amount of personal income tax on wages once a month, on the last day of the month.

When paying an advance (wages for the first half of the month), personal income tax is not calculated and is not withheld. That is why, in the middle of the month, the employee receives precisely the accrued amount. But making the final calculations, a personal income tax should be withheld, calculated on all wages, including advance payment. The employer must transfer the employee the amount of the monthly salary minus personal income tax and the previously issued advance.

Personal income tax from the salary of foreigners must be charged at a rate of 30% until the time spent in the Russian Federation does not exceed 183 days in 12 months. As soon as this happens, a foreign employee receives exactly the same rights as Russian employees. It means that you need to deduct personal income tax from his salary at the rate of 13%.

The deadline for payment of PIT withheld from employees to the budget is the next working day after the payment of wages for the month.

Group 2: Deductions at the expense of employers

There are four types of insurance contributions:

  • for mandatory pension insurance (pension contributions);
  • compulsory health insurance (medical contributions);
  • compulsory social insurance in case of temporary disability and maternity (contributions for «sick leave»);
  • a compulsory insurance against industrial accidents and occupational diseases (contributions for «injuries»).
These revenues are used to pay pensions, free medical care under the medical policy, pay for sick leave and child care benefits, and compensate for damage to life and health caused by injuries at work. These payments are always made by the employer and are not deducted from employees' salaries.

Contributions are usually paid at the rates: 22% of the salary for pension insurance, 5.1% for medical insurance, 2.9% for «sick leave». These contributions are transferred to the funds, and the Federal Tax Service controls their payment.

The rate of contributions «for injuries» is set annually by the divisions of the FSS for each policyholder.

The minimum rate is 0.2%, and the maximum is 8.5% of the amount paid to employees. Thus, even with the most «non-risky» activity in terms of injuries, the employer must transfer 30.02% of each employee’s salary to the budget every month. With high salaries, this indicator is slightly reduced. So, if the employee’s salary, determined by the cumulative total from the beginning of the year, exceeds 912,000 rubles, then you no longer need to pay contributions for «sick leave». And if the salary is more than 1,292,000 rubles, the rate of pension contributions from payments exceeding this value decreases from 22% to 10%.

Insurance contributions for the previous month must be paid not later than the 15th day of the current month.

The liability for non-payment of contributions and personal income tax

If the employer violated a term of payment of insurance contributions, the tax authorities would charge him interest based on Article 75 of the Tax Code. A penalty for non-payment is possible only if the contributions were not transferred due to errors made in the calculation of contributions. Then a fine of 20 percent of the unpaid amount will be added to the penalties.

Other rules apply to personal income tax. Penalties for the amount of tax are charged only if the employer has retained the money that was withheld from employees when paying their salaries. But a fine of 20 percent of the unpaid personal income tax amount will be issued to the tax agent in any case. Even if he did not withhold tax at all when paying his salary.

Reports

Сompanies are also required to submit various reports. Payroll tax reports are the largest category of the entire set of reports.

Reports to the Tax Service:

  • 2-PIT, annually, before March 1;
  • 6-PIT, quarterly, during one month after the end of the quarter (The Federal tax service has the right to block the company’s current accounts if the calculation of 6-personal income tax is delayed for more than 10 days);
  • Calculation of insurance contributions, quarterly, during one month after the end of the quarter;

Reports to the Social Security and Pension Funds:

  • 4-FSS, quarterly, during 25 days after the end of the reporting quarter;
  • SZV-M, monthly, during 15 days after the end of the month;
  • SZV-work record, monthly, during 15 days after the end of the month;
  • SZV — work experience, annually, before March 1.

Reports to Federal State Statistics Service:

  • P4, quarterly or monthly depending company size, during 8–15 days after the end of the quarter or month.
  • There is a number of reports which can be submitted additionally by Federal Statistic Service request.

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