Since 2022, the Federal Tax Service began requesting clarification from enterprises that pay wages to employees below the average for the constituent entity of the Russian Federation according to the corresponding activity code. What does this mean? How to respond to such a requirement? What consequences may occur if wages are slightly higher than the minimum wage? We figured out the situation and tried to answer these and other questions as accurately as possible in this article.
Determination of wages in accordance with the Labor Code of the Russian Federation
Chapter 21 of the Labor Code of the Russian Federation (LC RF) regulates the standards for the amount and payment of wages to employees. Paragraph 3 of Article 133 of the Labor Code of the Russian Federation states that the amount of remuneration for an employee who has worked for an entire month at full time cannot be less than the minimum wage.
In accordance with Article 133.1 of the Labor Code of the Russian Federation, regions have the right to set their own minimum wage, which cannot be less than the regional one. In this case, the minimum wage of workers must be equal to the regional minimum wage or higher
provided that the employee worked for a full month at full time.
The maximum wage is not limited by the norms of the Labor Code of the Russian Federation. This is indicated by Article 132 of the Labor Code of the Russian Federation.
Consequently, tax inspectors cannot oblige an organization to pay wages to its employees in the amount of the average for the constituent entity of the Russian Federation
according to the corresponding activity code. So why does the Federal Tax Service send such requirements to companies?
Salary commission
Even if the employer conducts its activities honestly, there is a possibility of a tax audit if the amount of payment is small. The salary commission is a council at which the tax inspector and the management of the enterprise talk, which takes place at the tax office at the place of state registration of the company. As the conversation progresses, the tax officer asks the manager questions about the wages of his subordinates and records all the answers received.
There are situations when a company pays wages to its employees in an envelope, therefore, it pays it in cash. The cash was obtained illegally, and the company evades paying taxes to the budget. The Federal Tax Service only has the facts, and to clarify the problem, the manager is called to the salary commission. Their main goal is to raise wages to an acceptable level, that is, the market average.
Can the Federal Tax Service demand clarification regarding the amount of salary?
The requirement to provide explanations may be stated by tax authorities in accordance with the Tax Code of the Russian Federation (Tax Code of the Russian Federation) and other regulatory legal acts, including orders and resolutions. Federal Tax Service specialists can request clarification regarding wages
based on clause 5 of the Publicly Available Risk Assessment Criteria, approved by Order of the Federal Tax Service of Russia dated May 30, 2007 No. MM-3-06/ [email protected] This document is used for planning on-site tax audits.
That is, such requirements are not based on the facts of identified errors or failure to provide information, but on the identification of problematic financial situations when assessing a business.
Official requirement of the Federal Tax Service
the provision of explanations regarding the low wages of employees is as follows.
That is, tax inspectors may request information from an organization based on the results of a desk audit of the Calculation of Insurance Contributions (DAC).
The presented document indicates that the company pays wages below the regional average. In this regard, the Federal Tax Service invites companies to analyze their activities in relation to financial security and income level
, identify the reasons that affect the amount of remuneration of employees and provide a response to the current situation to the tax service.
Salary below minimum wage
After submitting the DAM report, taxpayers began to receive requests from the tax office to explain the reasons for payments below the minimum wage. In this article we will look at whether the tax authorities are always right, and in what cases the salary may actually be below the minimum wage.
Note - for 2022 the minimum wage is 12,130 rubles.
According to Article 133 of the Labor Code of the Russian Federation: “The monthly salary of an employee who has fully worked during this period the standard working hours and fulfilled labor standards (labor duties) cannot be lower than the minimum wage.”
But there are cases when wages may be less than the minimum wage legally. Let's consider these options.
If an employee is hired on a part-time/weekly basis , then he receives pro rata for this. In this case, the employer did not violate anything, since, in terms of full working time, the employee’s salary will not be less than the minimum wage. To prove that you are right, you can attach copies of the following documents:
The second case is an employee’s sick leave . Since he was on sick leave, he did not work his normal working hours due to illness, and therefore received less. In this case, you can provide the employee's sick leave certificate.
Similarly, a payment less than the minimum wage can be in all cases when an employee has worked for less than a full month. For example, he took a vacation at his own expense, started his work activity not from the beginning of the billing month, or ended it before the end of the month. For all these cases, you probably have supporting documents: an application, an order of admission or dismissal, etc.
It is also possible to pay less if there was a deprivation of wages due to an employee’s absenteeism, the employee made a defect in production or did not pass the established production standard. Of course, all these cases must be documented.
And the last case is when an organization can pay an employee less than the minimum wage if there is an act of downtime at work due to circumstances not related to the employer’s decision.
Please note that if your employees receive wages below the industry average, tax officials may also ask for clarification. Such checks began on January 1, 2022. You can find out whether wages correspond to the industry average on the Rosstat website.
You should not ignore such requests and delay in responding. If explanations are not sent on time, tax authorities may charge additional personal income tax on the difference between real wages and the industry average or minimum wage. The Federal Tax Service may assume that you issue salaries in envelopes. Moreover, following the tax authorities, funds will also come with inspections: since there is a base for personal income tax, it means that a base for contributions has appeared.
Be sure to respond to the requirements from the tax office. Sometimes they are only explanatory in nature and you should not be afraid of them. Ask your questions and join my webinar on this topic.
Consulting on the correctness of payroll calculations for more than five years.
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Providing clarification on tax requirements
It is advisable for all companies and individual entrepreneurs to submit all explanations to the tax authorities in a timely manner. Such actions make it possible to form a good “personal attitude” of the inspector towards the taxpayer.
Answers and explanations should be sent to the tax authorities exclusively on paper or electronically via communication channels. This is how the company will be able, if necessary, to prove that it is a responsible taxpayer and complies with all the requirements of the Federal Tax Service.
You can write any reason in the document
and additional information in free form, since there is no approved template for explanations. The response is issued on the official letterhead of the company, if available. The following information must be reflected in the explanatory text:
- name, tax identification number and checkpoint of the enterprise;
- name of the tax authority;
- number and date of the submitted request.
The letter must be signed by the General Director
or other responsible person, and also certified by the seal of a legal entity.
For example, if the company was registered recently, it can be noted that production volumes have not yet reached planned levels. Or you can indicate that the founders of the company decided to purchase production machines or other necessary equipment that will increase production volumes, if such transactions were actually carried out in the past year.
But there is a separate category of organizations to which a corresponding requirement may also be sent - the industries most affected by the coronavirus pandemic
. Such companies can be advised to indicate as a reason the current situation in the country, which led to a temporary suspension of activities and a significant reduction in production.
If the company really is experiencing a deterioration in its financial situation, which has led to a decrease in employee compensation, then it is worth considering the previously adopted business development policy and drawing up a new business plan. Perhaps the company should involve a third party to analyze the company's activities and determine new management decisions . All decisions made must be reflected in the explanation of the requirement.
.
Consequences for the organization when paying below average wages
As noted earlier, payment of wages in an amount less than the average for the constituent entity of the Russian Federation is not a violation of either labor or tax legislation
. But this fact may attract the attention of the Federal Tax Service and lead to an on-site tax audit.
If the company really does not pay the highest salary to its employees, for example, due to a recent opening or a decrease in the number of sales (with piecework wages), but not less than the regional or all-Russian minimum wage, then there will be no consequences.
However, the fact of paying a small salary with large volumes of sales and revenue may mean that the organization is paying “gray” wages
. If the fact of payment of unofficial wages is revealed, the enterprise may be held liable for concealing reliable information and tax evasion.
Responsibility for non-payment of taxes and fees is provided for in Articles 122 of the Tax Code of the Russian Federation (20% or 40% of the amount of unpaid taxes) and 199 of the Criminal Code of the Russian Federation (tax evasion on a large and especially large scale - from 100 thousand to 300 thousand rubles or from 200 thousand to 500 thousand rubles
respectively). When brought to justice under a criminal article, other types of punishment are possible. Additionally, the organization may be held accountable for violating labor laws.
Possible discrepancies in requirements
But a more detailed study of the information reveals some discrepancies in these requirements.
. For example, the average salary is indicated not by region, but throughout Russia, or not by a specific OKVED code, but overall.
Also, when determining the average salary, the size of the business may not be taken into account, since for small businesses this is one indicator, and for large enterprises another.
If you do not go into the nuances specified in the requirement, then in most cases, provided that the company really does not hide anything, it provided a reasoned answer and, if necessary, evidence (losses incurred, minimal revenue, the duration of the company is less than 2-3 years with small sales volumes), then all of the above discrepancies are not important - tax inspectors will not order an on-site tax audit. And even if they come, they won’t find any significant errors.
Explanations from the Federal Tax Service regarding wages below the minimum wage
On August 11, 2022, Romashka LLC received a request from the tax inspectorate to explain why the average salary of individual employees in the organization is below the minimum wage.
In connection with receipt of the above message, we clarify that Romashka LLC has employees who are not full-time, namely:
Secretary Petrova Maria Aleksandrovna works part-time (4 hours a day), her average salary for 2022 is 9,130 rubles. per month;
courier Petr Petrovich Ivanov works part-time (2 days a week), his average salary for 2022 is 8,260 rubles. per month.
If these employees worked full time, their average salary would exceed the minimum wage.
