Taxation of remuneration to the chairmen of the Councils of MKD with insurance premiums
Insurance premiums are paid by persons making payments and other benefits to individuals. Such persons can also be organizations (clause 1, clause 1, article 419 of the Tax Code of the Russian Federation).
The object of taxation of insurance contributions for organizations is payments and other remuneration in favor of individuals subject to compulsory social insurance, made, in particular, within the framework of labor relations (clause 1, clause 1, article 420 of the Tax Code of the Russian Federation).
If a homeowners association has not been created in the building, or it is not managed by a housing or other specialized consumer cooperative, but the building has more than four apartments, the owners of the premises must elect the MKD Council at a general meeting. The MKD council is elected from among the owners of premises in a given building (Part 1, Article 161.1 of the Housing Code of the Russian Federation).
At the general meeting, the owners of premises in the MKD choose the method of managing the MKD and from among the members of the MKD council they elect the chairman of the MKD Council (Parts 2 and 3 of Article 161 and Part 6 of Article 161.1 of the Housing Code of the Russian Federation).
The General Meeting of Owners also has the right to decide on the payment of remuneration to the chairman and members of the MKD Council. Such a decision must contain the conditions and procedure for paying remuneration, the procedure for determining its size (Part 8.1 of Article 161.1 of the Housing Code of the Russian Federation).
To make a decision on paying remuneration to the chairman of the MKD Council, the owners analyze the list of his powers, which are established by Parts 7 and 8 of Art. 161.1 Housing Code of the Russian Federation.
Article 16 of the Labor Code of the Russian Federation determines that in cases and in the manner established by labor legislation and other regulations containing labor law norms, or the charter of the organization, labor relations arise as a result of election to a position.
Selection and legal status of the MKD council
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Managing organizations and remuneration to chairmen of the Councils of MKD
In the apartment management agreement, which is concluded between the owners of premises in the apartment building and the management organization, in addition to the list of services and types of work that the management organization carries out, additional responsibilities of the management organization may also be established. For example, the obligation to accrue and pay remuneration to the Chairman of the Council of the MKD at the expense of funds received to the account of the Managing Director from the owners of the premises in the MKD.
Let's sum up the intermediate results. If the OSS has decided that the management organization will pay the remuneration to the chairman of the MKD Council from the money received into its account from the homeowners, then in this case the management organization is the policyholder, and the chairman of the MKD Council is the insured person.
This means that in this case the management organization acts as a payer of insurance premiums on the amount of remuneration it makes in favor of the chairman of the MKD Council within the framework of labor relations. Basis – pp. 1 clause 1 art. 419 and paragraphs. 1 clause 1 art. 420 Tax Code of the Russian Federation.
The management organization submits a calculation of insurance premiums to the tax authority at the place of its registration (clause 7 of Article 431 of the Tax Code of the Russian Federation). In this calculation, the MA reflects information about all individuals whose policyholder it is, including information about the chairman of the MKD Council.
The Ministry of Finance of the Russian Federation draws attention to the fact that labor relations between an employee and an employer also arise on the basis of the employee’s actual admission to work with the knowledge or on behalf of the employer or his authorized representative in the case where the employment contract was not properly drawn up (Article 16 of the Labor Code of the Russian Federation ).
The Department believes that the source of payment of insurance premiums should be the funds of the owners of premises in apartment buildings and this should be provided for by the decision of the OSS in the expenses intended for the payment of such remuneration.
Structure and content of the employment contract with the chairman of the HOA
The employment contract with the chairman of the HOA is concluded between the partnership and the employee. The contents of this agreement can be found in Article 57 of the Labor Code of the Russian Federation.
Such an agreement must have the following clauses:
- Subject of the agreement.
- Rights and obligations of the parties.
- Salary.
- Working hours.
- Guarantees.
- Termination of an agreement.
Important: at the beginning of the employment contract with the HOA representative, you should indicate the place and date of signing.
Further information follows that the partnership acts as a board and enters into an employment contract with the employee, that is, with the chairman.
Remuneration for the chairman of the HOA
Indicated:
- Salary size.
- Payment procedure.
- Amount and terms of compensation payments.
Labor Code of the Russian Federation, article 132.
Working hours
The working week and the start and end times of the working day are established - Article 100 of the Labor Code of the Russian Federation.
Help: This also contains information about rest breaks and annual leave.
Payment of personal income tax on remuneration to chairmen of MKD councils
When determining the tax base for personal income tax, all income of the taxpayer received by him in cash and in kind, or the right to dispose of which he has acquired, is taken into account (clause 1 of Article 210 of the Tax Code of the Russian Federation).
Tax agents are persons who calculate, withhold from the taxpayer and transfer taxes to the budget system of Russia (Clause 1 of Article 24 of the Tax Code of the Russian Federation). Thus, tax agents are recognized as Russian organizations from which or as a result of relations with which the taxpayer received the income specified in clause 2 of Art. 226 of the Tax Code of the Russian Federation (clause 1 of Article 226 of the Tax Code of the Russian Federation).
It turns out that if the owners at the general meeting decided that the management organization will pay the remuneration to the chairman of the board of the MKD at the expense of money received into its account from the owners, in this case the management company acts as a tax agent.
If the MA is a tax agent, it has the obligation to calculate, withhold from funds paid to the taxpayer, and transfer amounts of personal income tax to the Russian budget system.
How the MKD Council can be useful to management companies
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Arbitrage practice
The courts have also not yet formed an unambiguous position; the Supreme Court of the Russian Federation has not considered such issues; judicial practice has mainly developed at the level of courts of first instance and appellate instances. The decision the court makes individually will depend on the specific situation and circumstances of the case.
1. Let us draw attention to the Resolution of the Federal Arbitration Court of the Northwestern District in case No. A26-1411/2013 dated December 12, 2013 (at the time of the adoption of this Resolution, housing legislation did not provide for remuneration for members and (or) the chairman of the house council, and precisely the Ministry of Construction referred to this resolution in its letter, which we discussed above in this article).
In this situation, there were two entities - the settlement center paying the remuneration, and the management organization. The personal income tax on the remuneration received by the chairman of the house council was paid by the settlement center. The court came to the following conclusion: the remuneration to the chairman of the council of the house is not an operation of the Company for the sale of goods (work, services) on the territory of the Russian Federation (income of the Company) and therefore VAT is not charged on its amount.
2. In the ruling of the Primorsky Regional Court dated March 31, 2014 in case No. 33-2590, it came to the conclusion that the management organization is obliged to withhold and pay the amount of personal income tax on remuneration. Thus, the activity of monitoring the fulfillment by the management company of obligations arising under the management agreement for an apartment building is not a service provided to the defendant, but is related to the representation of the interests of the owners of premises in the apartment building, carried out in their interests and on the basis of their decision. In accordance with the provisions of Part. Part. 1, 2 tbsp. 226 of the Tax Code of the Russian Federation , the management company is a tax agent, and therefore is obliged to calculate, withhold from the taxpayer and pay the amount of personal income tax , in connection with which the argument of the appeal about the absence of grounds for the payment of tax by the defendant is recognized as untenable.”
3. In the resolution of the Arbitration Court of the Ural District No. F09-1818/17 dated May 03, 2021 in case No. A60-3944/2016, the court came to the conclusion that the management organization should not withhold insurance premiums and transfer them to the appropriate budget . since the chairman of the MKD board does not have a direct relationship with the management organization. Thus, “in the absence of an employment contract or civil law agreement between the chairman of the board of an apartment building and the company, in the absence of such individuals performing work for the company or providing services for the company, there is no object of taxation with insurance premiums on the amounts transferred to these persons by the management company " . Decisions on the payment of remuneration to the house elder (chairmen of the house council), members of the board for performing the functions assigned to them were made by the general meeting, but not by the management company . The source of incentives for the chairman of an apartment building is payments from owners and tenants of residential and non-residential premises of the apartment building, in the amounts established by the meeting.”
4. The court came to a similar conclusion in the resolution of the Arbitration Court of the Volga District No. F06-19409/2017 dated April 17, 2021 in case No. A72-11114/2016: the management organization does not pay insurance premiums, since it is not the source of payments . The court noted that there is no evidence that the facts of concluding labor or civil law contracts with individuals who are the chairmen of the council of an apartment building, the subject of which is the performance of work or the provision of services for the company (management company), were established, and also that payments for which insurance premiums were charged were made precisely within the framework of the labor relations that arose between these persons and the management company. It is also stated that the sums of money collected by the company from the owners of the premises are not a payment from the management company to the chairman of the board for the work he has done for her or the service he has provided to her. In fact, the source of these payments is the funds of the owners of the premises of an apartment building, and not the management company.
Since at the moment there are only isolated cases of judicial practice, it is not possible to say unequivocally what general position the courts adhere to when resolving disputes about the subject of payment of personal income tax and insurance premiums, and about the obligation to pay insurance premiums. Summarizing only the existing isolated cases, we can say that personal income tax is payable, insurance premiums are payable if a contractual relationship has been concluded with the chairman.
Additionally, we note that an individual - a member or chairman of the house council does not pay insurance premiums on their own, and in the case of accrual of remuneration through a third organization (it does not matter whether the management organization is involved in this or any other), insurance premiums and personal income tax are withheld by this organization.
Even if the owners in the agreement with the management company stipulated that personal income tax is paid directly by the member (chairman) of the house council, the obligation to pay personal income tax still lies with the management organization. This issue was disclosed in the letter of the Russian Ministry of Finance dated March 09, 2021 No. 03-04-05/12891.
Please note that the necessary taxes and fees are only transferred by the management organization on behalf of the owners; the management company has no obligation to reimburse the missing amounts from its own funds; accordingly, the owners, when setting the amount of remuneration, must also provide for the fact that it is necessary to pay taxes on it.
Remember
The management organization may be the payer of insurance premiums from the amount of remuneration it makes in favor of the chairman of the MKD Council within the framework of labor relations (clause 1, clause 1, article 419 and subclause 1, clause 1, article 420 of the Tax Code of the Russian Federation).
The management entity must submit a calculation of insurance premiums to the tax authority at the place of its registration (clause 7 of Article 431 of the Tax Code of the Russian Federation).
In the calculation, the MA reflects information about all individuals for whom it is the insured, including information about the chairman of the MKD Council.
If the OSS has decided to pay remuneration to the chairman of the MKD Council by the management organization at the expense of money received into its account, the MA acts as a tax agent.
The tax agent must calculate, withhold from funds paid to the taxpayer, and transfer amounts of personal income tax to the Russian budget system.
