Loss from previous years under the simplified tax system “income minus expenses” in 2022

Current period loss

In a situation where, at the end of the year, an enterprise’s expenses exceed income, or there is no income at all, a loss occurs. If the loss occurred in the reporting period (quarter, half-year, 9 months), then there is no need to transfer an advance payment for this period. But at the end of the year the situation is somewhat different. If the organization had no income at all for the entire reporting year, then no tax is transferred. And if there was income, even if it was less than expenses, then a tax in the amount of 1% of income will have to be transferred to the budget. This is the minimum tax according to the simplified tax system. Also read the article: ⇒ “Expenses under the simplified tax system in 2022.”

Features of loss accounting

Losses can be taken into account in tax calculations only at the end of the year. This cannot be done when calculating an advance payment based on the results of a quarter, half a year or 9 months. This is one of the features of loss transfer for. Organizations using the general regime can do this without waiting for the end of the tax period. They have the right to do this already based on the results of the first quarter. When calculating the amount of the annual payment, organizations using the simplified tax system have the right to take into account the loss of previous years. A loss can be carried forward for no more than 10 years. Thus, the loss received in 2022 can be taken into account until 2027. But if the loss is not written off in full by 2027, it will no longer be possible to write it off and it will remain outstanding.

One of the conditions for reducing the tax base by the amount of a loss is its documentary confirmation.

You can confirm your loss: (click to expand)

• primary documents (invoice, act, etc.);
• copies of tax returns;
• books of income and expenses.

Such documents must be stored for no less than the period during which they can be used for transfer. That is, even if the period for storing documents according to the law allows them to be destroyed or transferred to the archive, they will have to be preserved for the entire period of transferring the loss. In addition, these documents are additionally stored for another 4 years. The Ministry of Finance clarifies this in letter No. 03-03-06/1/278 dated May 25, 2012. Thus, the total storage period of the document confirming the loss is 14 years.

The loss can be taken into account as a whole amount in the current period, or the balance can be transferred to any permitted year (within 10 years). Moreover, losses received in several periods are taken into account in the order in which they were received. That is, the loss that occurred earlier in time will be taken into account first.

Also read the article: ⇒ “Annual tax under the simplified tax system in 2022.”

When and what kind of losses can be taken into account?

If the completed year on a simplified basis brought a negative result in terms of the difference between revenue and the costs of obtaining it - a loss, the tax base calculated in subsequent years can then be reduced by its amount. The maximum period during which this can be done is 10 years following the year of the loss.

It is important to remember that we are talking specifically about the tax base, when the result between the income accepted on the simplified tax system and the expenses allowed for deduction under Art. 346.16 Tax Code of the Russian Federation. If, for example, you made some expenses that cannot be accepted as expenses for the simplified tax system, and due to them you incurred a loss only in accounting or management accounting, then such a loss will not be counted.

It is possible to reduce the tax base under the simplified tax system in the current year by a loss from previous years only if:

• During the year, the simplified tax system “income minus expenses” was applied;
• the tax base for the year is greater than zero.

If you, while remaining on the simplified tax system, changed the object of taxation (for example, you received a loss on the “income-expenditure” simplified tax system, next year you switched to the “income” system, and then returned to the “income-expense” system), then when you return to “ income-expense simplification, the right to take into account losses of previous “income-expense” years is retained for all 10 years after the year the loss occurred.

Example

Continent LLC applies the simplified tax system for income minus expenses. The income of Continent LLC for 2014 was 1,500,000 rubles, and expenses were 1,900,000 rubles. That is, for 2014, the LLC’s loss was: 1,900,000 – 1,500,000 = 400,000 rubles For 2014, the organization paid the simplified tax system in the minimum amount equal to: 1,500,000 x 1% = 15,000 rubles In 2015, the income of Continent LLC ” amounted to 1,200,000 rubles, and expenses – 1,190,000 rubles. We reduce the tax base for 2015 by the amount of tax paid to the budget for 2014, equal to 15,000 rubles. Thus, for 2015, Continent LLC again incurred a loss in the amount of 5,000 rubles: (1,200,000 – 1,190,000 – 15,000) For 2015, Continent LLC transferred the simplified tax system in the minimum amount: 1,200,000 x 1% = 12,000 rubles

In 2016, the income of Continent LLC amounted to 1,800,000 rubles, and expenses – 1,200,000 rubles. We reduce the tax base by the tax paid for 2015, equal to 12,000 rubles: 1,800,000 – 1,200,000 – 12,000 = 588,000 rubles. The outstanding loss for 2016 was: 400,000 + 5,000 = 405,000 rubles. Let's calculate the tax for 20 16 year due: (588,000 – 405,000) x 15% = 27,450 rubles

How to write off a loss using a simplified method

You can write off the loss all at once or in parts. The amount that can be written off should not exceed the value obtained in line 120 of section III KUDiR (book of income and expenses).

This value is added up as follows:

Where NBUU is the tax base reduced by losses

We talked about what the minimum tax is here.

The amount of loss that you can write off is reflected in line 130 of section. III KUDiR and in line 230 section. 2.2 declarations according to the simplified tax system.

If during the year in which you were going to use the loss to reduce your tax, you also received a loss, then you will not be able to do this. In this situation, lines 120 and 130 of section. III KUDiR line 230 section. 2.2 declarations will remain empty.

Is it possible to take into account losses for several years in a row in the future? Yes, you can. According to the same principle as a one-time loss, in chronological order: from the “oldest” loss to the new ones.

Example

If a loss is received in 2022 of 30,000 rubles and in 2022 – 40,000 rubles, and the simplified tax system “income minus expenses” base for 2022 (p. 120 section III) is 35,000 rubles, then you can write off the loss:

• 30,000 rub. for 2022 (entirely);
• 5,000 rub. for 2022.

The balance of the loss for 2022 is 35,000 rubles. will move on to the next years.

Accounting for losses during reorganization and regime change

An important point when carrying forward a loss to a future period is the transition from one tax regime to another. For example, an organization decided to switch to a general taxation system from a simplified one, or vice versa. In this case, it is impossible to transfer a loss from one tax system to another, that is, losses received under the simplified tax system do not transfer to the general regime and vice versa. The same applies to simplifiers who decided to switch from the “income minus expenses” mode to “income”. They do not have the right to carry forward losses to the next year under the new tax regime. Since under the simplified tax system “income” losses cannot arise and the tax base cannot be reduced on them. When the organization's activities are terminated due to its reorganization, it is also impossible to carry forward losses. An organization acting as a legal successor does not have the right to take into account the losses of the acquired company during the reorganization.

Change of tax regimes

Losses received when applying other taxation regimes are not taken into account when calculating the single tax. Conversely, losses incurred during the period of application of the simplification are not recognized if the taxpayer switched to other taxation regimes. When changing tax regimes, existing losses are taken into account as follows:

• a loss that was not taken into account when calculating income tax (was carried forward) before the transition to the simplified system, the taxpayer will be able to take into account only after returning to the general taxation system;

• a loss that was not taken into account when calculating the single tax (was carried forward) before the transition to the general tax system, the taxpayer will be able to take into account only after returning to the simplified system.

This procedure is provided for in paragraph 8 of paragraph 7 of Article 346.18 of the Tax Code of the Russian Federation and is explained in letters of the Ministry of Finance of Russia dated January 28, 2011 No. 03-11-11/18, dated October 25, 2010 No. 03-03-06/1/657.

Situation: is it possible to write off a loss from previous years if the organization (autonomous institution) applying the simplification has changed the object of taxation?

The answer to this question depends on what object of taxation the organization applies in the period in which it plans to write off the loss.

When simplified, a loss can accrue to an organization only based on the results of those periods in which it paid a single tax on the difference between income and expenses. In those periods when the organization paid a single tax on income, losses cannot arise. Since such an object of taxation does not take into account any expenses (clause 1 of Article 346.18 of the Tax Code of the Russian Federation), the result of the organization’s activities will always be positive.

The right to reduce the tax base of the current period by the amount of losses from previous years is granted only to those organizations that pay a single tax on the difference between income and expenses (clause 7 of Article 346.18 of the Tax Code of the Russian Federation). After an organization switches to paying a single income tax, it is deprived of this right. Consequently, in those periods when an organization applies the object of taxation “income”, it cannot write off losses that arose before the change in the object of taxation.

If an organization changed the object of taxation to “income” and then again began to pay a single tax on the difference between income and expenses, the tax base of the current period can be reduced by the amount of losses from previous years. Similar clarifications are contained in the letter of the Ministry of Finance of Russia dated March 16, 2010 No. 03-11-06/2/35.

When is it better to take into account a current period loss?

Based on the fact that accounting for losses from previous years is not an obligation, but a right of the company, it is better to use it if there is an economic benefit. It is most profitable to take into account a loss if the tax received during the calculation is greater than or equal to the minimum tax for the same period, that is:

(D – R – U) x 15% > D x 1%,

Where:

D – income of the organization for the reporting period; R – expenses of the organization and the reporting period; Y – loss of the organization that arose in the previous period; 15% – simplified tax rate; 1% is the rate for calculating the minimum tax.

If the two compared values ​​are equal, or the first one is greater, the organization will receive greater benefits due to the distribution of the loss.

Reflection of loss in the declaration according to the simplified tax system

Reflection of losses of previous years in the declaration under the simplified tax system (approved by Order of the Federal Tax Service of Russia dated February 26, 2016) occurs as follows. Initially, you need to indicate the taxable income for the tax period and the amount of expenses (lines 213 and 223, section 2.2, respectively). Include the difference in the amount of expenses - the amount of the minimum tax paid minus the tax for the previous period. If the previous period was unprofitable, then this difference will be the amount of the minimum tax. If there is no loss in the current tax period (that is, income exceeds expenses), the amount of the loss of the previous period is indicated in line 230. But only if it does not exceed the tax base in the current period. The final amount of the tax base is calculated as follows: the difference between the values ​​on lines 213, 223, 230 is recorded in line 240. Thus, in the reporting year, the tax base will decrease by the amount of losses from previous periods. If in a given period expenses exceed income, then a loss is indicated in the declaration (line 253).

Transfer of losses under the simplified tax system

The simplified tax system is a preferential tax regime in which some taxes are not paid (VAT, income tax, property tax on the average annual value of real estate). The tax rate is low - 6 (8)% for the object “Income”, 15 (20)% for the object “Revenue minus Expenses”. There is a fly in the ointment of benefits - expenses are accepted strictly according to the list established by the Tax Code of the Russian Federation (Article 346.16 of the Tax Code of the Russian Federation), there are limits on the use of a special regime (the number of employees is no more than 100-130, the amount of income is no more than 150 - 200 million, etc.) .

If the taxpayer chooses the object “Income minus Expenses” under the simplified tax system (clause 2 of Article 346.18 of the Tax Code of the Russian Federation), the tax is calculated from the monetary value of income reduced by the amount of expenses. The difference between income and expenses can also be negative. In this case, the tax base is zero (Federal Law No. 266-FZ dated July 31, 2020 added the second paragraph of paragraph 2 of Article 346.18 of the Tax Code of the Russian Federation from January 1, 2021 about the zero base).

If at the end of the tax period (calendar year) expenses exceed income, a loss is incurred. Just as with the general tax system, a loss may subsequently reduce the tax base of the next tax period.

But there are nuances that relate only to the simplified tax system:

1) clause 7 of Art. 346.18 of the Tax Code of the Russian Federation - the tax base can be reduced if the same object of taxation is used (“Income minus Expenses”) (letter of the Ministry of Finance dated May 5, 2017 No. 03-11-11/27739);

2) the amount of loss can only be reduced by the tax base calculated based on the results of the tax period (calendar year), and not reporting periods (letters of the Ministry of Finance dated May 19, 2014 No. 03-11-06/2/23437, dated May 26, 2014 No. 03- 11-11/24968), i.e., tax advances based on the results of reporting periods cannot be reduced by losses;

3) a loss can be transferred within 10 years after its receipt, and it can be transferred in total or in part to any year of the next nine years (clause 7 of Article 346.18 of the Tax Code of the Russian Federation) (example: a loss is received in 2022 - included in expenses it can be done in 2022, and in 2023, etc.);

4) losses incurred when applying other taxation regimes (general, for example), cannot be recognized under the simplified tax system (letter of the Department of Taxation in Moscow dated May 25, 2004 No. 21-09/34942), we note that the rule also applies to the simplified tax system - losses, received under the simplified tax system will not reduce the tax base for income tax;

5) if losses are received in several tax periods, they must be recognized in the order in which they were received (letter of the Federal Tax Service of Russia dated July 14, 2010 No. ШС-37-3/ [email protected] );

6) when changing the object of taxation, you may lose the right to recognize losses from previous years. For example, by changing the object from “Income minus Expenses” to “Income”, you can forget about losses from previous periods. But if you then return to the “Income minus Expenses” mode, and 10 years have not yet passed, the use of loss transfer can be resumed (letter of the Ministry of Finance dated March 16, 2010 No. 03-11-06/2/35);

7) the most important thing: if a loss is made under the simplified tax system, the minimum tax (1% on income) will still have to be paid.

Is it legal to charge taxes on losses?

If at the end of the tax period the taxpayer received a loss and the amount of tax calculated according to the general rules is zero, then the taxpayer has an obligation to pay the minimum tax (see letters of the Ministry of Finance dated June 20, 2011 No. 03-11-11/157, dated April 1, 2009 No. 03-11-09/121, Federal Tax Service of Russia dated July 14, 2010 No. ShS-37-3/ [email protected] ).
But not everyone agrees with this.

Please note the resolution of the Administrative Court of the North-Western District dated October 12, 2020 No. F07-11033/20 in case No. A26-12824/2019, the price of the issue is the minimum tax of 167 thousand rubles. and a penalty of 605 rubles.

Based on the results of 2022, the individual entrepreneur received a loss of 1.7 million rubles, did not pay the minimum tax, moreover, he tried in court to challenge the constitutionality of the fact of paying tax in case of losses: they say that collecting the minimum tax is not economically justified, it violates the balance of public interests and interests business entities, does not comply with the principle of proportionality of taxation. And in general, let the Arbitration Court make a request to the Constitutional Court and find out the legality of levying the minimum tax.

In fact, the Arbitration Courts have such a right - Part 3 of Article 13 of the Arbitration Procedure Code of the Russian Federation indicates: if, when considering a specific case, the Arbitration Court comes to the conclusion that the law applied or to be applied in the case under consideration does not comply with the Constitution of the Russian Federation, the Arbitration Court appeals to the Constitutional Court of the Russian Federation with a request to verify the constitutionality of this law. But not in this case, the Arbitration Court of the Northwestern District decided. The court's conclusion: the presence of a loss does not relieve a taxpayer using the simplified tax system from the obligation to pay the amount of the minimum tax provided for in paragraph 6 of Art. 346.18 Tax Code of the Russian Federation.

Is it necessary to document losses?

Of course you need it! Common sense and judicial practice convince us of this.

In the Resolution of the Arbitration Court of the Volga-Vyatka District dated July 24, 2019 No. F01-3303/2019 in case No. A11-649/2016, the court once again recalled: there is a Federal Law “On Accounting” No. 402-FZ dated December 6, 2011, which obliges to document all business transactions, including those that led to losses. Circumstances of the case: the individual entrepreneur declared in the declaration for 2014 income of 17 million, expenses of 9.8 million, as well as losses from previous years in the form of expenses for the construction of an administrative building in 2008 in the amount of 45 million. At the same time, documents on the costs of construction of the building She did not provide the IP, stating that the Federal Tax Service should have independently reduced the current tax base by the amount of losses in 2008.

The court decided that if the loss reflected in the declaration is not confirmed by primary documents, but is only taken into account in tax registers and declarations of previous years, then it cannot be recognized.

Another court decision (resolution of the Federal Antimonopoly Service of the East Siberian District dated August 29, 2013 No. F02-3894/13 in case No. A78-111/2012) made a similar conclusion: without primary documents, it is impossible to take into account losses from previous years, even if they are reflected in the books and in registers. The case involved the bank's bills of exchange, which were used to pay off with suppliers. While recognizing this as an expense, the bank did not confirm the issue of these bills of exchange, since a lot of time had passed, and the taxpayer did not have the bills themselves. The result is that losses were not allowed to be recognized.

If you recognize losses from previous years, keep the primary documents confirming the formation of losses during the entire period of recognition and another 5 years later (clause 8, clause 1, article 23, clause 4, article 283 of the Tax Code of the Russian Federation). Controllers have the right to check these documents (letter of the Ministry of Finance dated April 30, 2019 No. 03-02-08/32313).

We reflect losses in the Income and Expense Book and in the declaration

The transfer of losses is reflected in tax accounting: in the Book of Accounting for Income and Expenses in Section III, the total amount of losses is indicated in the context of each “unprofitable” tax period and the amount that is taken to reduce the tax base of the reporting tax period.

Section III of the Book:

In the declaration under the simplified tax system (the form and procedure for filling out the declaration were approved by order of the Federal Tax Service dated December 25, 2020 No. ED-7-3 / [email protected] ) the amount of loss received in the previous tax period(s), for which the tax base is reduced for the current tax period is reflected on line 230 of Section 2.2. The indicator in this line is involved in calculating the tax base for calculating tax according to the simplified tax system for the tax period (line 243 of Section 2.2).

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