How to add OKVED codes for individual entrepreneurs in 2021

If you decide to change types of activities or expand your business, you need to notify the tax office about this by submitting an application on form P24001 with new OKVED codes. The application is submitted without paying a state fee in any convenient way - directly to the tax office, online, through the MFC or by mail. Form P24001 is intended to notify the Federal Tax Service of names in the individual entrepreneur data specified in the Unified State Register of Individual Entrepreneurs. There is no need to fill out and print all the sheets of this form - you must fill out page 001, sheets D and E.

Important!

From November 25, 2020, the application form P24001 for registering changes in information about individual entrepreneurs in the Unified State Register of Individual Entrepreneurs and the requirements for its completion have changed. If you prepare an application using the old form, the tax office will not accept it. Our free service will help you prepare documents according to the new sample.

OKVED

Each legal entity and entrepreneur without the formation of a legal entity is engaged in certain types of economic areas.
In order to avoid discrepancies in the names of these types and standardize the procedure for their selection, the legislation of the Russian Federation combined them into the All-Russian Classifier of Types of Economic Activities (OKVED). The document contains an exhaustive list of types of economic areas that business entities can engage in. Each type of economic direction corresponds to a specific numeric code, the minimum number of digits in which is 4 characters.

When registering a legal entity or entrepreneur without forming a legal entity with the Federal Tax Service, they indicate in the documents the main and additional codes of economic areas. There should always be one main type of economic direction, and the number of additional types of economic directions is not limited by law and depends on the desire of the business entity.

How to fill out an application correctly

Completing the P24001 application is an important point that you should pay attention to when preparing to make changes. When filling out you should pay attention to the following points:

The form has 8 sheets, but you do not need to fill them all out. The pages you need depend on the situation.
On the main page, the basic data of the individual entrepreneur is indicated, that is, his full name, tax identification number, OGRNIP, and so on.
New codes are located on page 1 of sheet D.
The exclusion of old unnecessary codes is written on page 2 of sheet D.
The application is filled out with a black or blue pen; you can fill it out on a computer, even using special services and programs. The main thing is that it corresponds to the P24001 form.
Only capital letters are used.
The application does not need to be signed with your own hand; this should be done at the Federal Tax Service, with an employee who will certify the signature.
The document does not need to be stitched.

In general, the requirements for filling out the application are fully consistent with those required for the application for registration of an individual entrepreneur.

Sample form No. P24001:

Download form No. P24001 (sample/form)

filling

Read: Registration of an individual entrepreneur in the Social Insurance Fund as an employer

Change of OKVED

Options for economic directions chosen by a legal entity or an entrepreneur without forming a legal entity can subsequently be changed, and they can be added at any time. The legislation does not contain restrictions on changing these types; the main requirement is that a change of OKVED is subject to state registration with the Federal Tax Service inspection, and the main code and type must always remain the same.

To change the types of economic directions and register this change with the Federal Tax Service inspection, a legal entity or an entrepreneur without forming a legal entity must decide on a new set of specified types, add them to the charter (if necessary), and then indicate them in the form that will be presented to the registration authority.

Since the list of types of economic activities is constantly changing and updated by the state, the All-Russian Classifier of Types of Economic Activities changes almost every year. In 2016, three editions of the All-Russian Classifier of Types of Economic Activities are in effect simultaneously, and state registration of the choice and change of types of economic activities is carried out according to the All-Russian Classifier of Types of Economic Activities OK 029-2014.

If, when changing the type of economic direction, you indicate the incorrect version of the All-Russian Classifier of Types of Economic Activities, the Inspectorate of the Federal Tax Service will refuse to perform registration actions. This is due to the fact that only the edition of the All-Russian Classifier of Types of Economic Activities OK 029-2014 contains current classifier codes.

Should an individual entrepreneur change OKVED when changing activities?

If an individual entrepreneur has begun to engage in a new type of activity, then he must inform the tax authority at the place of his registration within three working days (sub-clause “o”, clause 2 and clause 5 of Art. Federal Law dated 08.08.01 No. 129- Federal Law; hereinafter referred to as Law No. 129-FZ). For violation of this requirement, a fine of 5 thousand rubles is possible (Clause 3 of Article 14.25 of the Code of Administrative Offenses of the Russian Federation).

From the literal interpretation of the norm in paragraph 5 of Article of Law No. 129-FZ, it follows that the new OKVED code is entered into the register if the individual entrepreneur actually conducts business (and does not carry out one-time transactions) in a type of activity not specified in the Unified State Register of Individual Entrepreneurs.

Check the OKVED codes of “your” individual entrepreneur and his contractors

The legislation does not contain criteria by which one-time transactions can be distinguished from systematic business activities. You need to rely on common sense and the usual understanding of the term “systematic”. Conducting one or two transactions during the year should not be regarded as a systematic activity aimed at generating income from the sale of goods, performance of work or provision of services (i.e., as a type of entrepreneurial activity). Therefore, it is not necessary to formally enter the additional OKVED code into the register in this case.

But there is an important point to consider. For tax purposes, income received from transactions that do not correspond to the declared OKVED codes is considered “non-entrepreneurial” (letter of the Ministry of Finance dated November 22, 2017 No. 03-04-06/77155). This means that when paying income, the counterparty (organization or other individual entrepreneur) must withhold personal income tax, even if the entrepreneur who received this income applies a special regime. If such income comes from an “ordinary” individual, then the individual entrepreneur himself is obliged to include this amount in the personal income tax return. Moreover, in full, without reduction for professional tax deductions.

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ADVICE

The additional OKVED code must be entered into the Unified State Register of Individual Entrepreneurs even for a one-time transaction. It is better to do this in advance, before receiving income from such an operation. Otherwise, additional tax charges are possible. Also see “The Federal Tax Service clarified how inspectors should identify unregistered entrepreneurs.”

OKVED codes for individual entrepreneurs

An entrepreneur without forming a legal entity selects types of economic areas during registration by selecting the appropriate data from the All-Russian Classifier of Types of Economic Activities. As a rule, as the main individual entrepreneur he chooses exactly the type of economic areas that he plans to engage in. As additional types, an individual entrepreneur can indicate an unlimited number of them or one code, even if he does not actually carry out these types of work.

An individual entrepreneur can make changes to OKVED at any time at his own discretion. To do this, he needs to fill out an application in form P24001 (On making changes to information about an individual entrepreneur contained in the Unified State Register of Individual Entrepreneurs), in which he should indicate the required code, and send it to the registration authority - the Inspectorate of the Federal Tax Service.

Choosing new OKVED

To select the desired code, it is better to use OKVED in electronic form with the ability to search by keywords. It is necessary to indicate the words that correspond to the new type of activity (for example, “rent,” “welding,” “sidewalk,” etc.) and read the description of the groups where they were found.

The classifier is built on the principle: “from the general to the specific.” Therefore, you need to “climb” the grouping higher to codes containing four, three, and then two digits, and study the explanations for them (for example, from code 01.11.31 go first to code 01.11, and then to codes 01.1 and 01). It is quite possible that after studying the “upstream” codes you will understand that the “downstream” code is not suitable for you. Carefully read the explanations for all groups that the new code is included in. Typically, it first describes what activities are covered by the grouping, and then provides exceptions.

If a suitable code is found, then one more question needs to be resolved: enter a “lower” code into the Unified State Register of Entrepreneurs, or “go up” in the grouping above and indicate a code that includes a larger number of possible operations?

REFERENCE

Include “superior” codes containing four digits in the Unified State Register of Individual Entrepreneurs. This will expand the list of operations that an individual entrepreneur has the right to engage in, and therefore will reduce the risk of claims from tax authorities.

If a keyword search does not produce results, you will have to select the code based on the general logic of constructing the classifier. First you need to select a section (they are designated in Latin letters in OKVED), and within it - the most suitable grouping. And already in this grouping, find codes corresponding to “other types of activities not included in other groups.” Usually they are at the very end of the group.

Select OKVED codes for free in a special web service

For example, this is exactly what individual entrepreneurs who are engaged in intermediary activities (agents, commission agents) will have to do. There is no special code for them in OKVED. Therefore, when carrying out such activities, code 82.99 “Activities for the provision of other support services for business, not included in other groups” is applied.

Next, you need to analyze how the selected code will affect the amount of tax liabilities of the individual entrepreneur. The fact is that the use of some OKVED codes entails the loss of the right to PSN, a reduced single tax rate under the simplified tax system or reduced insurance premium rates.

If an individual entrepreneur has hired employees, you need to check which class of professional risk the activity belongs to under the new code. It is quite possible that the new OKVED will lead to an increase in the insurance premium rate for injuries.

Also see “Taxes for individual entrepreneurs with and without employees in 2021.”

OKVED for individual entrepreneurs

The application in form P24001 is filled out by the individual entrepreneur by hand or using computer technology. Submission of an application in form P24001 is carried out personally by the entrepreneur (in this case, he puts a personal signature on the application in the presence of a tax officer), or by means of a valuable postal item (in this case, the entrepreneur’s signature is subject to notarization).

Within a period of no later than five working days from the date of filing the said application, the registration authority makes additions to the information in the Unified State Register of Individual Entrepreneurs regarding changes in the types of economic directions.

What documents will be required?

Submitting an application does not require any additional paperwork. All you need is an application form and a passport. If a passport is not available, then another identity document is used (residence permit, temporary ID, etc.).

Additionally, a power of attorney, a certificate of temporary registration or permission from legal representatives may be required if the action is carried out by a minor individual entrepreneur.

Read: Application for simplified tax system (simplified tax) when registering an individual entrepreneur

Amendments to OKVED IP

Changes to the list of types of economic directions for individual entrepreneurs can occur in the following options:

adding OKVED codes for individual entrepreneurs (one new code or new codes of economic areas are added without changing the previous codes);
change (previously selected codes may be completely or partially removed with the simultaneous addition of new types of economic areas).

In any case, the individual entrepreneur must always have one main code and type of work.

Sample application form P24001 for changing OKVED codes

An example of a completed form P24001 when changing OKVED codes - Create an application

Generate an application automatically Enter your data in the form, download the already completed application P24001 and all other documents for changing the types of activities of an individual entrepreneur. Create an application
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Adding OKVED code for individual entrepreneurs

Changing the code of an economic direction does not entail consequences for individual entrepreneurs in the field of taxation, with the exception of cases when one or more codes are taken into account under the preferential procedure for calculating and paying taxes.

The individual entrepreneur selects codes for starting work or in the process of activity independently, based on his own needs. There is a standard selection of codes for various areas. The more detailed it is indicated (this indicator can be traced by the number of digits in the code), the narrower the scope of action of a particular code.

How to choose OKVEDs

When registering, you can specify as many types of activities as you like. This will not in any way affect the tax rate, the possibility of using special taxation systems or special programs, or accounting. All this can change only from the moment the individual entrepreneur begins to actually work in these areas.

If for some reason you need to add activities, you can do this at any time. There are also no restrictions on the number of applications. Applications can be submitted immediately after registration.

It is recommended to add all OKVEDs that directly or indirectly affect the activity. For example, if retail trade is planned, you can also indicate wholesale, as well as trade in related goods. This will protect the entrepreneur in case such a transaction is still required.

You can even indicate those types of activities that you do not plan to engage in at all. The only difficulty is that the application for registration or amendments will be extended by several sheets. It is also worth checking whether it is permissible for an individual entrepreneur to conduct this activity; there are some changes in this regard.

Adding OKVED code for LLC

An LLC can also change the codes by which its economic activity is determined at any time. To do this, the LLC must fill out an application in form P13001, in which note (indicate) the necessary additions.

To change the LLC codes provided for in the charter, this decision must be approved. This fact is reflected in the minutes of the general meeting of the founders of the Company or in the decision of the sole participant.

Like an entrepreneur, an LLC has several options for changing codes:

adding codes for society (new codes of economic areas are added without changing previous codes);
changing codes for society (previously selected codes can be completely or partially removed while simultaneously adding new types of economic areas).

Confirmation of codes

Some organizations, when concluding various types of transactions with an entrepreneur, ask for confirmation of his codes. To do this, you can contact the tax authority to obtain an extract from the Unified State Register of Individual Entrepreneurs. The extract contains current information regarding the entrepreneur, and this document confirms his status.

The procedure for initial registration and addition of new codes is quite simple and does not require the help of specialists. However, you should be very careful when choosing codes, because if one code is specified, and the entrepreneur works in a completely different direction, the tax authority has the right to impose penalties and deprive the individual entrepreneur of the opportunity to apply preferential taxation.

Making changes to OKVED LLC codes

If a company changes codes not provided for by the charter, it must fill out an application in form P14001. Applications in form P13001 and P14001 are subject to mandatory notarization.

The addition of OKVED codes for an LLC must be registered with the Federal Tax Service with the information posted in the Unified State Register of Legal Entities. The period for completing registration actions in this case should not exceed five working days from the date of submission of the application.

How to apply for the addition of OKVEDs

The application must be submitted to the Federal Tax Service at the place of business of the individual entrepreneur. You can do this in one of the following ways:

Personally, through the Federal Tax Service office. In this case, you will not have to certify it. You can also use the services of a representative, which will require a power of attorney executed by a notary.
Through MFC. Documents can also be given independently or through a representative by proxy.
Through Russian Post. To do this, you will first have to have it notarized. You can contact any notary, regardless of your place of residence.
Online, through the taxpayer’s account or government services portal. In this case, an electronic digital signature is required.

You can choose any method, depending on which one seems more convenient.

Selection of OKVED codes for individual entrepreneurs

Each entrepreneur selects codes at his own discretion. However, such a selection must take into account current changes in the legislation of the Russian Federation, because registration using an outdated edition of the classifier or inaccurate codes may lead to the refusal of the registration authority to accept the corresponding changes.

Simplified taxation system

When choosing OKVED for an individual entrepreneur who is going to work on the simplified tax system, you need to be extremely careful about this issue. After all, to apply the simplified system, minimum tax rates are provided.

To obtain the right to apply the simplified tax system, the chosen line of business must comply with what is allowed under the given taxation system.

For example, if among the areas indicated in the application are the services of a lawyer or notary, the tax authority will prohibit the use of the simplified tax system.

Therefore, choosing OKVED for individual entrepreneurs requires preliminary familiarization with some legislative acts regulating the taxation of individual entrepreneurs.