Individual entrepreneurs (IP) will be exempt from tax and insurance debts. Deputies of the lower house of parliament of the Russian Federation supported the introduction of adjustments to the country's Tax Code. The bill, within the framework of which arrears on certain types of taxes will be written off from entrepreneurs working as individual entrepreneurs, was considered and approved by the relevant committee. Earlier, deputies also supported the initiative of the Ministry of Finance to exempt businessmen from paying debts on insurance premiums.
What debts can be written off
Of course, it is possible to close an individual entrepreneur even with debts - this topic has been raised more than once.
But the debts themselves will not go away; the loss of individual entrepreneur status does not relieve a citizen from liability for obligations. Therefore, you will still have to pay or write them off. Forgiveness of individual entrepreneurs' debts is possible on several grounds. An individual entrepreneur can count on repayment of the following debts:
- on property and income taxes;
- on insurance premiums;
- before counterparties;
- on loans, including as part of writing off credit debts by individuals.
Various write-off mechanisms are defined by law: from tax amnesty to declaring an entrepreneur bankrupt in court. But let's consider everything in order.
What could be the liquidation procedure?
The Federal Law (No. 129 of 08/08/2001), in force in Russia, describes in detail the process of closing an individual entrepreneur. Business entities can liquidate their business in several ways:
- on a voluntary basis;
- in a forced form;
- in connection with the death of a business entity;
- on bankruptcy;
- due to cancellation of individual entrepreneur registration in the Russian Federation.
In order to initiate a voluntary liquidation process, an individual entrepreneur needs to collect a package of documents and submit a standard application to the state registrar. After this, the individual entrepreneur must go through several difficult stages of closure, after which it can be deregistered with regulatory authorities and extra-budgetary funds.
The situation is more complicated with the forced closure of an individual entrepreneur. This type of liquidation requires the participation of representatives of Themis, since it starts only after the court makes an appropriate decision. The initiator of the closure of an individual entrepreneur’s business can be regulatory authorities or creditors, who in this way try to repay all debts.
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Advice: individual entrepreneurs should remember the statute of limitations, which for Pension contributions is 3 years. If representatives of this fund go to court after its expiration, then the business entity can focus the removal of the judge on the expired terms. Thus, he will be released from the obligation to repay the debt to the Pension Fund, and the debt will be written off from him.
Tax amnesty: law on writing off debts of individual entrepreneurs
In 2021, the Federal Tax Amnesty Law No. 436-FZ continues to apply. It allows you to cancel debts that are not subject to collection, but continue to be listed on the personal accounts of taxpayers. Putin signed a law that applies to all entrepreneurs: both current and former.
Who can benefit
It is important to understand that legal entities will not be able to take advantage of this scheme - under the tax amnesty, the debts of individual entrepreneurs and individuals can be written off. The specific list is specified in 436-FZ. It includes:
- individuals with arrears in payment of transport, land and property taxes, including penalties on them;
- existing individual entrepreneurs and individuals previously engaged in entrepreneurial activities;
- business entities: notaries, lawyers, other privately practicing individuals.
Write-off of individual entrepreneurs' debts is available only for taxpayers who have no debts for later reporting periods. Only in this case will the tax office make a recalculation.
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How debts are written off
A measure in demand today is the write-off of debts on taxes and insurance premiums. The decision to write them off is made directly by the tax authority operating at the place of registration of the entrepreneur. This is done as follows:
- The Federal Tax Service forms a decision on writing off arrears, which is drawn up in any form. The decision indicates the full name and tax identification number of the payer, information about his debts that will be written off.
- The Federal Tax Service also forms a decision on writing off penalties and fines, which is also drawn up in any form. The document reflects the taxpayer’s details and the amount of debts to be written off.
It is worth noting that the law does not establish specific deadlines during which the tax office is obliged to write off debts. However, the taxpayer can speed up this process by sending a corresponding application with a request to write off the debt to the tax authority.
The taxpayer can clarify the amount of arrears and the procedure for writing them off independently through the tax service website. To access information, you need to register with the State Services, or have an electronic digital signature of the taxpayer.
Over what period is debt written off?
The Tax Code provides for debt write-off for the following reporting periods:
- in relation to taxes not paid as of 01/01/2015;
- in relation to arrears of insurance premiums as of 01/01/2017.
If there are arrears for later periods, the amnesty will not take place. First you will have to deal with your current debts.
Debt write-off amount
A significant advantage of the tax amnesty is that individual entrepreneur debts can be written off regardless of their size. The law does not establish a minimum and maximum amount of arrears and penalties accrued on them, beyond which would not allow taxpayers to exercise their legal right to write-off.
Let's look at an example:
- As of January 1, 2015, an individual or individual entrepreneur had a debt in the amount of 100 thousand rubles.
- Penalties and fines accrued for arrears amounted to another 10 thousand rubles.
- Then the taxpayer’s total debt will be equal to 110 thousand rubles. It is this amount that will be written off as a result of the tax amnesty.
Government measures to support individual entrepreneurs during a crisis
President of Russia V.V. Putin gave orders to provide a number of measures to help individual entrepreneurs during the pandemic.
What did individual entrepreneurs receive in the most affected areas of activity:
- Extension of deadlines for submitting tax reports.
- Deferment of a number of taxes or payment in installments.
- Deferment of insurance premiums.
- Credit holidays in banks.
Postponement or installment plan
To take advantage of support measures from the state, it is necessary to document losses due to coronavirus. To apply for an installment plan or deferment, you must submit an application to the tax authorities.
Installment or deferment for more than 6 months is possible only if there is security. For example, guarantees, bank guarantees, real estate.
To get a deferment, you must prove that revenue has decreased by at least 30%.
Credit holidays for individual entrepreneurs
If an individual entrepreneur has lost his solvency, during a pandemic you can contact a credit institution with a request for a vacation. The basis is a decrease in income compared to average monthly revenue in 2021 by 30% or more. Vacation period is up to 6 months.
Write-off of bad loans
In July, the State Duma approved a law stating that loans taken by individual entrepreneurs to restart a business due to coronavirus can be considered bad.
The state will write off loans at a preferential rate of 2% received from January 1 to December 31, 2020.
Debts will be written off if the company does not go bankrupt and continues to do business. To write off, you need to contact the bank with an application and confirm that more than 90% of the employees are retained on staff - then the loan will be written off completely. If at least 80% of employees remain on staff, the bank will change the loan agreement and write off half of the debt and interest.
The bank's expenses and losses are fully compensated by the state.
How to write off a tax debt for an individual entrepreneur
Since the tax service often has a lot of other equally important tasks, writing off old debt can take years. Then it’s wiser to write it off yourself by following these steps:
- It is more convenient to receive a certificate of tax debts from the Federal Tax Service through your personal account. If you need to involve the court, it will serve as confirmation of the existing debt.
- Submit a claim to the tax office, then to the Office of the Federal Tax Service of Russia for your region. This is a mandatory step in the pre-trial resolution of disputes, without which the court will not accept the case for consideration. There is no specific form of claim - it will be enough if it discloses information: who is demanding, from whom and what exactly. For example, this one:
- Apply to the court. Similar to a claim, an application does not strictly have a form - it is enough that it meets the requirements of Art. 131 Code of Civil Procedure of the Russian Federation. Depending on the workload of a particular judicial authority, consideration of the application may take from 2–3 to 4 months or more.
When making a decision, the court looks at whether the deadline for collecting tax debts has passed. If they pass, then he takes the applicant’s side. Then the judicial act will say something like “The Federal Tax Service has lost the ability to collect arrears due to the expiration of the statute of limitations.” Here is an example of such a decision on UTII.
- Then you need to send a copy of the received judicial act to the tax office. This is not necessary, but it’s better to remind yourself once again - then writing off your debts will go faster.
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- At the final stage, all that remains is to obtain a certificate from the tax service confirming the absence of debts.
The Federal Tax Service has 6 days to write off the debt. If the individual entrepreneur debt remains hanging in the tax authority’s database, then file a complaint with the local branch of the Federal Tax Service. First, you can complain to the Office of the Federal Tax Service of Russia for your region, then (if there is no positive effect) - to the Prosecutor's Office of the Russian Federation.
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"Senseless" debt
Deputies considered and approved another amendment to the Tax Code, specifically Article 217. The adjustments increase the list of income that will be exempt from taxation. It is proposed to include among these incomes that were received in the period from January 1, 2015 to December 1, 2021 (from which tax was not withheld).
Experts explain that by introducing the proposed changes, the problem of accumulated debts to the tax system will be eliminated, when collection authorities assessed personal income tax to citizens as a result of writing off their debts to banks, telecommunications companies, etc. President Vladimir Vladimirovich Putin called this practice meaningless. However, we are not talking about getting rid of it altogether. “Contingent income” that the businessman received after the period mentioned above is subject to personal income tax.
The law provides that a tax agent who has not withheld personal income tax is obliged to report this to the tax authorities. Such situations arise if a person received some economic benefit, but not with money in the physical sense. For example, if the bank wrote off the payer’s debt or the company allowed the employee not to pay for a previously taken out loan. In such situations, the citizen must send a declaration and settle accounts with the state. But not all residents of our country act according to the law, and the tax service does not always have the opportunity to collect small amounts.
What debts does the tax amnesty write off?
The exact mechanism for writing off debts for individual entrepreneurs is explained in Art. 11 and art. 12 of Law No. 436-FZ. In short, entrepreneurs have the opportunity to get rid of debts incurred directly as a result of their business activities. In particular:
- VAT and personal income tax debts;
- arrears on land and property taxes;
- debts under the Unified Agricultural Tax, Unified Internal Income Tax, and the simplified tax system;
- debts of entrepreneurs working on the basis of a patent.
But it is important to understand that if the taxpayer’s debt was not incurred in connection with business activities, then it will be written off according to the general rules applied to individuals. And in this way you can only write off transport, land and property taxes.
Legal regulation
During the amnesty in 2021, the debts of individuals recognized as bad will be written off completely without the need to repay them after a certain time. The basis for this is Federal Law No. 436-FZ “On Amendments to Parts One and Two of the Tax Code of the Russian Federation and Certain Legislative Acts”, signed on December 28, 2021. The main provisions of this document entered into legal force the next day after its adoption; for certain provisions a later deadline was set.
The main advantage of the adopted federal law is not only that all bad debts are subject to write-off. The Government of the Russian Federation undertakes to forgive all fines and penalties that have accrued due to the delay in paying mandatory government fees to the budget. If the collection of mandatory payments from individual entrepreneurs had already been carried out before the adoption of the law, a refund of the funds paid will not be made.
Amnesty on insurance premiums
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The fiscal amnesty also provides for the disposal of debts on insurance premiums, penalties and fines accrued on them. Provided that they were formed before January 1, 2021. But here there are a number of limitations.
For example, only additional insurance premiums accrued for annual income exceeding 300 thousand rubles are written off. According to the norms, an entrepreneur must accrue them at a rate of 1%, but in the absence of reporting, the Pension Fund always calculates them based on eight times the minimum wage. These “overcharges” will be written off as a result of the amnesty.
“Huge” charges and fines
According to the head of the budget committee, many who have not even started doing business face heavy fines. For individual entrepreneurs who did not submit tax reports to the Federal Tax Service (accordingly, the Pension Fund of the Russian Federation could not determine their income), the Pension Fund assessed contributions payable in the maximum amount - 8 minimum wages. “And it turns out that, although he has not started his business, the entrepreneur already has 8 minimum wages. Therefore, the government proposes to give the opportunity to write off the Federal Tax Service,” Makarov said.
Such relaxations from the Ministry of Finance may be associated “with an imperfect system of data transfer from the Pension Fund to the tax authorities” (from the beginning of 2021), says Ilya Burtsev, senior tax manager at IPT Group. Since the beginning of the year, many individuals registered as individual entrepreneurs began to receive “chain letters” from tax authorities demanding additional payment of huge amounts of allegedly unpaid insurance payments for previous periods, which already included fines, the lawyer says.
Matvienko proposed redistributing taxes in favor of the regions Economy
According to Burtsev, in practice, after a reconciliation with the Pension Fund of Russia, almost all requirements and fines from individual entrepreneurs are removed. “Most likely, the introduction of such an amnesty may allow fiscal authorities to reduce the number of lawsuits from those individual entrepreneurs from whom fines have already been removed, but who would like to restore justice and their additional costs in connection with the misunderstanding,” he argues.
What is not subject to amnesty
The legislation clearly defines the types of debts to which cancellation does not apply. These include:
- Excise taxes applied to entrepreneurs selling excisable goods: alcohol, tobacco products and others.
- Mineral extraction tax (with the exception of common ones: crushed stone, sand and others).
- VAT when transporting goods across the border of the Russian Federation.
- Insurance premiums for employees.
Entrepreneurs will not be able to write off these debts. At least within the framework of the tax amnesty.
Bankruptcy of individual entrepreneurs without trial
On September 1 of this year, amendments to the Bankruptcy Law came into force. In accordance with the changes, you can become bankrupt for free by simply submitting an application to the MFC at your place of residence. This will allow debtors to avoid legal costs.
Who is the new law aimed at?
The amendments apply to individual entrepreneurs and individuals (for example, borrowers of microfinance organizations and banks) with debts from 50 thousand to half a million rubles. In addition, the debtor must not own property that is subject to sale.
No new enforcement proceedings should be initiated against him, and the old ones should be completed - this is when the bailiffs returned the writ of execution to the claimant (that is, in fact, the debtor has no property, he has nothing to pay with).
How is the procedure for writing off debts of individual entrepreneurs through the MFC?
The debtor applies to the MFC (after going through the active collection stage) with an application for extrajudicial bankruptcy indicating all creditors. After checking the information in the FSSP, MFC employees check the presence (absence) of grounds for bankruptcy.
If the decision is positive (the verification takes 1 business day), information about the applicant is entered into the unified federal register within 3 days. From this time on, the accrual of all penalties and interest stops, and the amount of debt is fixed.
From the moment of registration until the official recognition of bankruptcy, at least six months will pass. After this time, and provided that no creditor disagrees, the debt is considered uncollectible and written off.
What is the difficulty?
In reality, not all entrepreneurs will be able to take advantage of the extrajudicial bankruptcy procedure, even if they meet the legally established requirements. There are a number of reasons for this:
- Proving financial insolvency is not easy. For example, the creditor may not turn to the bailiffs, but when conducting enforcement proceedings, FSSP employees are able to search for the debtor’s property for years. It turns out that the waiting period for the closure of the writ of execution is extended for an indefinite period of time.
- It is also worth considering that after the bailiff returns the writ of execution, the claimant resubmits it for execution. Accordingly, a citizen or entrepreneur risks not having time to submit an application for extrajudicial debt write-off.
- If the applicant receives liquid property (for example, an inheritance), the procedure for writing off the individual entrepreneur's debts through the MFC will be terminated. Bankruptcy through the MFC can be stopped if in the application he forgot to mention the creditor, who may demand that the issue of the entrepreneur’s insolvency be resolved in court.
That is, the possibility of successfully writing off debts through the MFC will depend on the actions of bailiffs, creditors, and only a small part - on the debtor himself.
Writing off bad debts in 2021
Last year, the tax authorities prepared a draft Order on the procedure for writing off arrears and fines deemed uncollectible. The document allows you to write off debts in the following cases:
- When an individual or individual entrepreneur is declared bankrupt. Along the way, the procedure allows entrepreneurs to get rid of credit debts for personal and commercial purposes and debts to counterparties.
- When the court declares the period for collecting the arrears has expired. That is, when, according to the law, it is impossible to collect the debt by force or apply interim measures to the debtor to return it.
- If funds were written off from the taxpayer’s account, but were not credited to the budget account.
- In case of death of an individual and liquidation of an individual entrepreneur.
You can learn more about how to deal with debts if your solvency has decreased from our credit lawyers. Just call us by phone or ask your question online.
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To whom does it apply, for what years?
Amnesty of transport tax debts is available to all Russian citizens who own registered cars. Its direct action cannot be limited by anything. Therefore, the amnesty does not depend on:
- Citizen status, place of work, amount of his income;
- Place and region of permanent residence;
- Ownership time and vehicle engine power;
- Reasons for non-payment of the debt amount (no importance, payment was not made due to lack of money or unwillingness);
- Gender, age and technical characteristics of the car subject to mandatory registration;
- Number of registered cars per person or family;
- The number of people in the family, the inflation rate and other important economic indicators.
After the transport tax amnesty law comes into force, debts are written off in all cases. The most important point in this situation is the fact of writing off absolutely any amount that is credited to a person before January 2021 (i.e., debts arose before January 2020 and were recorded on that date). Taking into account the amendments from 2021, taxes, fines and penalties from four years ago are written off by the tax service.
Interesting: Will the transport tax be abolished in 2021?
A citizen who owes debt to the Federal Tax Service does not need to participate. In this case, the fine can be successfully deleted automatically from the general database. The service is not required to provide a notification for this.
To find out whether the debt has been removed under President Putin’s transport tax amnesty law, you can go to the official website of the tax service by checking the status of the debt through your personal account. Registration is required here. You can also find out about the amnesty by visiting the tax office in person and requesting materials about yourself.
As a rule, all necessary documents are issued quickly and you can obtain the necessary information within 1-2 hours. Everything will depend on the queues. In addition, there is an option to call the Federal Tax Service hotline and consult with them on this issue. In some cases, they may send information to a postal address.
It is important to note that for the period of 2021 there is an amnesty for debts from 2021. That is, the 2014 transport tax does not fall under the amnesty. The President of the Russian Federation did not propose any innovations in this regard. When asked whether there was an amnesty for transport tax before, it is worth pointing out that it previously took place in 2014 and was valid for debts that were four years old. Then, more than 50 thousand residents of the country and their relatives received assistance from the state in the form of reducing their debt burden.
When will it take effect?
The authors of the law on writing off the debts of individuals and individual entrepreneurs in 2021 were the State Duma vice-speakers: Sergei Neverov, Pyotr Tolstoy and Alexander Zhukov, as well as the head of the budget committee Andrei Makarov and committee member Andrei Isaev.
According to Andrei Makarov, the 2021 “tax amnesty” will take effect on January 1. Now the official text of the document should be published by Rossiyskaya Gazeta, after which it will be included in the reference and legal system Consultant Plus, where it will be enriched with expert comments.
