Veterans, citizens with children, disabled people: how much are they entitled to standard deductions for personal income tax?
The state provides certain categories of citizens with the opportunity to pay a smaller amount of personal income tax by reducing the income they receive by standard deductions.
Standard deductions are fixed amounts, the amount of which is established in Art. 218 Tax Code of the Russian Federation. Their peculiarity is the regularity of provision. Most can be received monthly throughout the year. Only “children’s” standard deductions have a number of additional restrictions and preferences: the size of the deduction depends on the number of children, their age, parents’ income calculated on an accrual basis from the beginning of the year, and other nuances.
The amounts of standard deductions and the categories of citizens to whom they can be provided are shown in the figure:
If the taxpayer is simultaneously entitled to standard deductions in the amount of RUB 3,000. and 500 rubles, he will be given the maximum deduction. The possibility of receiving “children’s” deductions remains regardless of the availability of the right to other standard deductions (clause 2 of Article 218 of the Tax Code of the Russian Federation).
Amounts of deductions for children established by tax legislation
Every month, parents or adoptive parents receive a deduction for their children until they reach the age of majority (18 years) (within certain salary limits until the salary reaches 350 thousand rubles). However, its size depends on the following factors:
- 1400 rub. issued for the first two children;
- 3000 rub. the taxpayer receives for subsequent children, starting with the third;
- 12,000 rub. – for each child with a disability or disabled student studying full-time at an educational institution, until they reach 18 years of age (or 24 years of age if the student has a disability of 1-2 groups).
The same benefits are provided for guardians, trustees and foster parents, with the exception that for each child with a disability or full-time student, 6,000 rubles are allocated. instead of 12,000.
If a parent (adoptive parent, guardian, etc.) is raising children alone, he is provided with a double deduction until the children enter into legal marriage. Also, double the amount can be provided to one of the parents if the second officially refused the benefit in favor of the first.
Letter of the Ministry of Finance of the Russian Federation No. 03-04-05/1999 dated January 21, 2016 provides that when determining the amount of the standard deduction, the total number of children is taken into account, including those who have reached the age after which parents lose the right to receive this benefit.
Thus, if an employee has four children aged 26, 24, 19 and 16 years, children aged 26, 24, 19 are not entitled to tax benefits due to their age. For this reason, the employee receives a deduction of 3,000 rubles. for a 16-year-old child, since he is the fourth. It should be borne in mind that if the child is a full-time student under 24 years of age, then he is entitled to a deduction. Accordingly, in the above example, children who are full-time students of universities and colleges are also entitled to a deduction in the amount of 1,400 rubles. for everyone.
By the way, in certain situations, deductions are summed up. The letter of the Ministry of Finance of the Russian Federation No. 03-04-06/15803 dated March 20, 2022 and No. 03-04-05/85821 dated November 7, 2022 considers the rights of employees to two types of deductions at once if they have a child with a disability. With reference to the Review of Practice approved by the Presidium of the Supreme Court on October 21, 2015, the department reports that the taxpayer is entitled to a regular deduction for children and an additional deduction for a child with a disability. For example, if there are three children under the age of majority, the third of whom is disabled, the amount of deductions will be as follows:
- 1st – 1400 rub.;
- 2nd – 1400 rub.;
- 3rd – 3000 rub. + 12,000 rub. for disability.
If the child is the first, then he is entitled to 1,400 rubles. standard deduction for personal income tax, as for the first child, and 12,000 rubles. – for disability, i.e. in the amount of 13,400 rubles.
A mechanism for saving on personal income tax using standard deductions
Let's look at an example of how standard deductions help you save money.
Plumber Igor Petrovich Tarasov has the right to a monthly standard deduction of 500 rubles. according to sub. 2 p. 1 art. 218 Tax Code of the Russian Federation. He is caring for two children aged four and eleven years old. The amount of “children’s” deductions for him is 2,800 rubles. (RUB 1,400 × 2). In January 2022, Tarasov I.P. received a salary of 28,731 rubles. How will the standard deduction help him save money?
Let's calculate the tax taking into account standard deductions (NDFL1) and excluding them (NDFL2):
Personal income tax1 = 13% × (28,731 - 500 - 2 × 1,400) = 3,306 rubles.
Personal income tax2 = 13% × 28,731 = 3,735 rubles.
Thanks to the use of standard deductions, Tarasov I.P. will save 429 rubles. (3,735 - 3,306) in January 2022. In subsequent months (until the end of the year), you can still save using a deduction of 500 rubles. The opportunity to save on “children’s deductions” will continue until Tarasov I.P.’s income, calculated cumulatively from the beginning of the year, does not exceed 350,000 rubles. (Subclause 4, Clause 1, Article 218 of the Tax Code of the Russian Federation).
IMPORTANT! If the employee’s income exceeds 5 million rubles. per year, exceeding the amount from 2022 is taxed at a rate of 15%.
For an example of a calculation, see a typical situation from ConsultantPlus. If you do not have access to the K+ system, sign up for a trial demo access for free.
How many applications should I submit for two deductions?
When submitting a 3-NDFL declaration to the tax office at the end of the reporting year, an individual will need to fill out only one application for a tax refund. Since 2022, it has been included in the declaration itself, approved by order of the Federal Tax Service dated October 15, 2021 No. ED-7-11 / [email protected] , as Appendix 1 to Section 1. No matter how many deductions a person claims, he will indicate the total amount in the application tax calculated for refund.
NOTE! On one page of the application there are two applications at once: one for a tax offset, the other for a tax refund.
If a person decides to receive deductions from an employer, there may be several applications. A person writes an application for standard deductions either when applying for a job, or when receiving such a right, for example, when a child is born in the middle of the year. For the provision of social and property deductions - upon receipt of a notification from the tax office. That is, these statements could be written at different times. If the right to several deductions arose simultaneously, then one application will be sufficient, which spells out the procedure for their provision.
A ready-made solution from K+ is described on how an employer provides a social deduction for treatment. Get free demo access to the system and read all the most necessary and up-to-date information about personal income tax.
How to save on personal income tax when buying or building housing and when property deduction is not possible
A property deduction is a benefit provided by the state that makes it possible, after purchasing or selling property, to return part of the previously paid personal income tax or reduce its current deductions.
The Tax Code of the Russian Federation provides for four types of property deductions. The size of each of them is limited by the maximum amount:
Find out how the amount of property deduction depends on the type of property being sold and other important nuances of this type of deduction.
A property deduction is not provided if funds from employers or other persons, as well as maternity capital, were used in the purchase or construction of residential real estate (or the acquisition of land for individual housing construction).
You should not count on a deduction even if the purchase and sale transaction of residential real estate was concluded between interdependent persons.
When citizens are recognized as interdependent persons, we tell in this material.
Property deduction is not provided for the sale of securities and certain types of property (for example, real estate used in commercial activities).
Tax deductions
Tax deductions for personal income tax
What are tax deductions? Why was this term invented and what does it mean? Why are “tax deductions” sometimes also called “tax refunds”? How do these terms differ from each other?
Below we will try to answer these questions in the most accessible and understandable language.
To make sure everything is clear, it is better to start a little from afar, namely with the fact that most of us work and receive wages.
We receive wages from which our employer has already withheld personal income tax (NDFL). For example, if you receive 25,000 rubles a month in your hands, this means that in fact your income in this organization is 25,000 / 87 * 100 = 28,736.
This amount is easy to check: from 28,736, calculate 13% (this is the tax rate that is withheld from everyone’s salary by their employer) and you get 3,736. Now from 28,736 – 3,736 = 25,000 rubles. That is, our salary turned out to be 25,000 minus the tax of 3,736, which the employer withheld and transferred to the budget.
The current tax legislation of our country in certain cases allows us not to impose income taxes on our wages or other income. That is, in the above example, you will receive in your hands not 25,000 rubles, but all 28,736.
This is where the term “tax deductions” comes in. Please note that the term itself contains the word “deduction” - that is, a decrease in some of our income by a certain amount that may not be subject to personal income tax.
In other words, when certain “circumstances” occur, it is permitted not to calculate or withhold personal income tax into the budget from the employee’s salary or when the employee receives certain income - to calculate the amount of tax payable not on the entire amount, but only on part of it.
Example:
the employee bought an apartment (built it, with his own money, with a mortgage - it doesn’t matter). In this case, tax legislation allows not to pay personal income tax to the budget on the employee’s income (his salary) up to 2,000,000 rubles. That is, the state grants the employee the right to apply a tax deduction in the amount of the purchase price of the apartment, but not more than 2 million rubles.
“Apply a tax deduction” - that is, reduce the employee’s income by a certain amount (in our example, up to 2,000,000 rubles), from which tax is allowed to be withheld to the budget.
The employee, in this case, has the right to receive a property tax deduction from his employer. Having completed certain procedures to exercise this right, the employee will receive a “full” salary, from the example above - 28,736 per month (not 25,000).
Thus, until the employee’s total income accumulates in the amount of the cost of purchasing the apartment (but not more than 2 million rubles), the employer will not withhold tax.
But what if the employee purchased an apartment not from the beginning of the year, but in the middle - or at the end, when the employer had already withheld personal income tax from the employee’s salary before that month?
This is where the term “tax refund” comes into play.
A tax refund is when the tax inspectorate returns tax that was, as it were, excessively withheld from the employee’s income (after all, the employee bought an apartment and has the right not to tax his income up to 2 million rubles, and the employer withheld personal income tax from the salary and transferred it to the budget).
In order to return the over-withheld tax, the employee must fill out a 3-NDFL tax return at the end of the year. The declaration will be filled out also on the basis of data from the 2nd personal income tax certificate. And this certificate contains all the information - what the employee’s salary is and how much tax the employer withheld and transferred to the budget.
Thus, a tax refund for a particular year is possible in an amount no more than the tax deduction required by law and in an amount no more than the tax withheld from the salary according to the 2-personal income tax certificate. Let us remind you that the 3-personal income tax declaration, as well as the 2-personal income tax certificate, are filled out for a specific year.
Therefore, a tax deduction is an opportunity to reduce income from which you don’t have to pay personal income tax to the budget, and if it was still paid, then return it as overly withheld (tax refund).
Above we talked about the property tax deduction; social and standard tax deductions work in a similar way.
The only difference between them is that property deductions when purchasing residential real estate do not expire, but are transferred to subsequent years, until they are fully received.
If you bought an apartment for 2 million rubles, you are entitled to a deduction in full - 2,000,000 rubles, therefore, you have the right not to pay personal income tax on income in the amount of up to 2 million rubles, at least 10 years in a row, until you earn that much, or, if the employer withholds personal income tax from your salary, then, based on the 3-personal income tax declaration (submit from year to year), return everything that he withholds for a particular year from the tax office until you fully return what is due - in our example, this is 13% of 2 million rubles, that is, 260,000 rudders.
And social deductions are not carried over to subsequent years. For example, you had training expenses of 110,000 rubles. You have the right to a deduction in this amount; your employer withheld tax from you in the amount of 7,000 rubles for the year (for example, you were on maternity leave and did not work much). With 110,000 you are entitled to a return of 14,300 (that is, 13%), but in fact you will return only 7,000, the rest is not carried over to the next year, but burns out (unlike property deductions).
Let's look at another example where the term “tax deduction” is also used.
When selling an apartment that you have owned for less than 5 years, you must pay personal income tax at a rate of 13% to the budget. At the same time, you have the right to reduce your income:
- or by 1 million rubles - the so-called tax deduction, which is currently established by legislators;
- or the amount of your expenses when you bought the property you are now selling.
As you can see, there is no question of a tax refund here; here the tax deduction simply reduces the tax base, that is, income from the sale. In this example, you yourself will calculate and pay the tax to the budget; in the example above, your employer pays the tax for you, so in most cases we are talking about a tax refund.
Thus, we will give two definitions of tax deductions:
- this is a certain amount that reduces the income of an individual, with which it is allowed not to pay income tax;
- This is a so-called “tax refund,” that is, the opportunity to return part of previously paid personal income tax to the budget.
Consequently, on the one hand, tax deductions make it possible to reduce the current amount of income tax payable to the budget; on the other hand, if the tax has already been paid, return part of it back.
Tax deductions can be received by:
persons - tax residents of the Russian Federation (that is, persons who are in the territory of the Russian Federation for 183 days or more for 12 consecutive months) receiving income from which personal income tax is withheld at a rate of 13%;
Tax deductions cannot be obtained: (we are talking about a tax refund)
- unemployed people who have no income other than unemployment benefits;
- pensioners and disabled people, if their only income is a pension, which is not taxed;
- persons who receive child care benefits (the benefit is also not subject to income tax);
- individual entrepreneurs who work under special regimes (for example, simplified tax system, UTII, etc.), while there is no income, which is taxed at a rate of 13%.
Individuals can claim tax deductions for the last 3 years. For example, you can file tax returns for 2014, 2015, and 2016 in 2022.
How to get a tax deduction:
The legislation of the Russian Federation offers 2 ways to obtain tax deductions:
- Through the tax office: (this will be a tax refund) by filling out and submitting 3-NDFL tax returns and attaching all the necessary documents to the tax office for the previous three years. The maximum period for consideration and transfer of part of the tax refund by the inspectorate will be 4 months.
- Through the employer: this method is suitable for obtaining the following deductions: property deduction for the purchase of an apartment, all social deductions (except for deductions for charity, for expensive treatment and for the education of children), standard deductions. It is necessary to submit a corresponding application to the tax office with supporting documents attached. Within 30 days, the tax office will provide a Notification, which must be taken to the accounting department of your organization and filled out another application. From this moment on, the employer will not withhold income tax from the individual’s salary. But if the amount to be returned (according to the deduction) turns out to be more than what was paid by the employer from the moment the application was submitted, then in order to return the balance, it will still be necessary to submit a 3-NDFL tax return to the inspectorate next year.
Tax deductions are:
- Standard tax deductions: for yourself, for your child(ren);
- Social tax deductions: for charity, for training, for treatment and the purchase of medicines, for voluntary personal insurance, for non-state pension provision, for voluntary pension insurance, for voluntary life insurance, for expenses for the funded part of the labor pension;
- Investment tax deductions: in the amount of a positive financial result from the sale of securities, in the amount of funds contributed to an IIS, in the amount of a positive financial result from transactions on an IIS;
- Property tax deductions: when selling property, when purchasing real estate;
- Professional tax deductions.
Types of social deductions
A social deduction is a legally established opportunity for an individual who has spent funds on education, treatment and some other social purposes to return part of previously paid personal income tax or reduce current tax obligations.
Types of social deductions are presented in the figure:
IMPORTANT! From 2022, you can apply for a new social deduction to pay for fitness services. We talked about the nuances in this publication.
Read more about each type of social deductions in the material.
Who is eligible for the professional deduction?
A professional deduction is an opportunity for individual entrepreneurs, private practitioners, executors of GPC agreements or persons receiving royalties when calculating personal income tax to reduce income received by the amount of documented expenses.
Find out what nuances to consider for each category of professional deduction recipients.
Ordinary citizens who are not registered as individual entrepreneurs, are not engaged in private practice, do not perform work under civil contract agreements and do not receive royalties cannot take advantage of the professional deduction.
Decoding personal income tax deduction codes: table
| RECORD CODE | TYPE OF DEDUCTION |
Standard children's deductions (subclause 4, clause 1, article 218 of the Tax Code of the Russian Federation) | |
| Deduction for a child under the age of 18, as well as for a full-time student under the age of 24 to the parent, spouse of the parent, adoptive parent who is supporting the child | |
| 126 | when providing a deduction for the first child |
| 127 | when providing a deduction for a second child |
| 128 | when providing a deduction for the third and each subsequent child |
| 129 | when providing a deduction for a child who is a disabled person of group 1 or 2 |
| Double deduction for a child under the age of 18, as well as for a full-time student under the age of 24 - for a single parent, adoptive parent | |
| 134 | when providing a deduction for the first child |
| 136 | when providing a deduction for a second child |
| 138 | when providing a deduction for the third and each subsequent child |
| 140 | when providing a deduction for a child who is a disabled person of group 1 or 2 |
| Double deduction for a child under the age of 18, as well as for a full-time student under the age of 24 - to one of the parents, if the other parent refused to receive his child deduction | |
| 142 | when providing a deduction for the first child |
| 144 | when providing a deduction for a second child |
| 146 | when providing a deduction for the third and each subsequent child |
| 148 | when providing a deduction for a child who is a disabled person of group 1 or 2 |
Property deductions (Article 220 of the Tax Code of the Russian Federation) | |
| 311 | Expenses for the construction/purchase of housing on the territory of the Russian Federation, acquisition of land plots for individual housing construction (IHC), land plots on which the purchased residential buildings are located |
| 312 | Interest expenses on targeted loans received for the construction/purchase of housing in the Russian Federation, the acquisition of land plots for individual housing construction, land plots on which the purchased residential buildings are located |
Social deductions (subparagraph 2 and subparagraph 3, paragraph 1, article 219 of the Tax Code of the Russian Federation) | |
| 320 | Expenses of the taxpayer for his own education, full-time education of a brother or sister under the age of 24 in educational institutions within the established limit |
| 321 | Expenses of a taxpayer-parent (guardian, trustee) for full-time education of their children (wards, former wards) under the age of 24 in educational institutions within the established limit |
| 324 | Expenses for medical services provided to the taxpayer himself, his spouse, parents, children (including adopted children), wards under the age of 18, as well as expenses for medications prescribed by the attending physician and purchased by the taxpayer at his own expense within the established limit |
Professional deductions (Article 221 of the Tax Code of the Russian Federation) | |
| 403 | Documented expenses incurred during the performance of work (provision of services) under civil contracts |
| 404 | Documented expenses associated with receiving royalties |
| 405 | Amount within the limits of cost standards associated with receiving royalties (as a percentage of the amount of income) |
Deductions for income not subject to personal income tax within certain amounts (subclause 8 and subclause 28 of article 217 of the Tax Code of the Russian Federation) | |
| 501 | Deduction from the value of gifts received from organizations and individual entrepreneurs |
| 503 | Deduction from financial assistance provided to employees, as well as former employees who quit due to retirement |
| 505 | Deduction from the value of winnings and prizes issued as a result of competitions, games and other events held for advertising purposes |
| 508 | Deduction from one-time financial assistance to employee-parents (adoptive parents, guardians) at the birth (adoption) of a child |
Specific transactions for investment deduction
Investment deduction is discussed in Art. 219.1 of the Tax Code of the Russian Federation, introduced by the Law “On Amendments...” dated December 28, 2013 No. 420-FZ.
An individual has the right to this deduction if he:
- received income from transactions with securities traded on the organized securities market;
- deposited personal savings into your IIS (individual investment account);
- received income from transactions placed on the IIS.
Find out how to get an investment deduction for personal income tax in ConsultantPlus. Learn the material by getting trial demo access to the system. It's free.
We talk about the nuances of how organizations use the investment deduction in the article “Investment tax deduction for income tax.”
Results
Standard, social and property tax deductions are the most commonly used types of personal income tax deductions.
They are available to individuals receiving income subject to personal income tax at a rate of 13%, subject to certain conditions being met (having children, disabled or veteran status, purchase and sale of property, etc.). Professional and investment deductions are less common and are available to a limited number of people. You can find more complete information on the topic in ConsultantPlus. Free trial access to the system for 2 days.
