Chapter 24. Uniform Social Tax

Article 234. General Provisions

The present chapter of the Code institutes a uniform social tax (hereinafter referred to as "tax" in the present chapter) intended for mobilising funds for the purpose of exercising the right of citizens to state pension and social welfare (insurance) and medical aid.

Article 235. Taxpayers

1. The following persons are deemed the taxpayers of the tax (hereinafter referred to as "taxpayers" in the present chapter):

1) persons making disbursements for the benefit of natural persons:

organisations;

individual entrepreneurs;

natural persons not recognised as individual entrepreneurs;

2) individual entrepreneurs, lawyers.

For the purposes of this Chapter members of a peasant farm shall be equated with individual businessmen.

2. If a taxpayer is simultaneously classified under the several categories of taxpayers specified in Subitems 1 and 2 of Item 1 of the present article he shall accrue and pay the tax on each ground.

Article 236. Object of Taxation

1. For the taxpayers specified in Paragraphs 2 and 3 of Subitem 1 of Item 1 of Article 235 of the resent Code the object of taxation shall be the disbursements and other remunerations accrued by taxpayers for the benefit of natural persons under labour and civil legal contracts the subject matter of which is the performance of works, provision of services (except for the remunerations disbursed for the benefit of individual entrepreneurs) and also under copyright contracts.

For the taxpayers specified in Paragraph 4 of Subitem 1 of Item 1 of Article 235 of the present Code the object of taxation shall be the disbursements and other remunerations paid by the taxpayers for the benefit of natural persons under labour and civil legal contracts the subject matter of which is the performance of works, provision of services.

The following is not classified as object of taxation: disbursements effected within the framework of civil legal contracts the subject matter of which is the transfer of a right of ownership or other rights in rem to property (proprietary rights) and also contracts relating to the transfer of property (rights in rem) for use.

2. For the taxpayers specified in Subitem 2 of Item 1 of Article 235 of the present Code the object of taxation shall be incomes from entrepreneurial activity or another professional activity less the expenses relating to their production.

For the individual entrepreneurs applying the simplified taxation system the object of taxation shall be the gross earnings determined under the Federal Law on the Simplified Taxation, Accounting and Reporting System for Small Businesses with due regard to the provisions of Item 3 of Article 237 of the present Code.

For taxpayers who are members of a farm (including the head of a peasant farm), the actual expenses incurred by said peasant's farm in connection with development thereof shall be excluded from incomes.

3. The disbursements and remunerations specified in Item 1 of the present article (irrespective of the form thereof) shall not be deemed object of taxation if:

taxpayers being organisations do not classify such disbursements as expenses reducing the tax base for the purpose of the tax on the profit of organisations in the current accounting (tax) period;

taxpayers being individual entrepreneurs or natural persons do not have tax base reduced by such disbursements for the purposes of the personal income tax in the current accounting (tax) period.

4. The disbursements specified in Items 1 and 2 of the present article shall not be deemed a tax basis if they are effected at the expense of funds remaining at the disposal of the organisation after the tax on the profit of organisations or funds remaining at the disposal of the individual entrepreneur or natural person after the tax on the incomes of natural persons.

Article 237. Tax Base

1. The tax base of the taxpayers specified in Paragraphs 2 and 3 of Subitem 1 of Item 1 of Article 235 of the present Code shall be determined as the sum of the disbursements and other remunerations specified in Item 1 of Article 236 of the present Code accrued by the taxpayers for the tax period for the benefit of natural persons.

When tax base is being determined account shall be taken of any disbursements and remunerations (except for the amounts specified in Article 238 of the present Code), irrespective of the form thereof, in particular, a full or partial payment for goods (works, services, rights in rem or other rights) intended for a natural person being an employee or members of the family thereof, in particular, utility services, meals, recreation, education in their interests, the payment of insurance contributions under voluntary insurance policies (except for the amounts of insurance contributions specified in Subitem 7 of Item 1 of Article 238 of the present Code).

The tax base of the taxpayers specified in Paragraph 4 of Subitem 1 of Item 1 of Article 235 of the present Code shall be determined as the sum of the disbursements specified in Item 2 of Article 236 of the present Code for the tax period for the benefit of natural persons.

2. The taxpayers specified in Subitem 1 of Item 1 of Article 235 of the present Code shall determine the tax base separately for each natural person as accrued and cumulative from the beginning of the tax period upon the expiration of every month.

3. The tax base of the taxpayers specified in Subitem 2 of Item 1 of Article 235 of the present Code shall be determined as the sum of incomes received by such taxpayers for the tax period both in pecuniary form and in kind from entrepreneurial or another professional activity less the expenses relating to the production thereof. In such a case the composition of the expenses accepted as deductibles for taxation purposes for the given group of taxpayers shall be determined in the manner similar to that applied to determine the composition of the expenses established for the payers of the profit tax by relevant articles of Chapter 25 of the present Code.

For the individual entrepreneurs applying the simplified taxation system tax base shall be determined as gross earnings times the coefficient 0.1.

4. When tax base is being calculated disbursements and other remunerations in kind in the form of goods (works, services) shall be taken into account as the value of these goods (works, services) as of the date of disbursement thereof calculated on the basis of their market prices (tariffs) and in the case of state regulation of prices (tariffs) for these goods (works, services), on the basis of state regulated retail prices.

In such a case the value of the goods (works, services) shall include a relevant value added tax amount and also a relevant excise tax amount for excisable goods.

5. The amount of remuneration taken into account in tax base calculation in as much as a copyright contract is concerned shall be determined in compliance with Article 210 of the present Code with the account taken of the expenses stipulated by Item 3 of Part 1 of Article 221 of the present Code.

Article 238. Amounts Which Are Not Taxable

1. The following shall not be subject to taxation:

1) state allowances paid according to the legislation of the Russian Federation, legislative acts of constituent entities of the Russian Federation, decisions of representative bodies of local self-government, including temporary disability allowance, allowance for care of sick child, unemployment benefit, maternity and birth of child allowance;

2) all types of compensatory disbursements (within the limits of standards established according to the legislation of the Russian Federation) established by legislation of the Russian Federation, legislative acts of constituent entities of the Russian Federation, decisions of representative bodies of local self-government and involving:

reimbursement of harm caused by crippling or other damage to health;

free granting of housing and utilities, meals and foodstuffs, fuel or a relevant pecuniary reimbursement;

payment of cost and/or issue of authorized allowance in kind and also the disbursement of cash instead of such allowance;

payment of cost of meals, sports gear, equipment, sports and dress uniform received by the sportsmen and staff of physical culture and sports organizations for the training process and participation in sports competitions;

dismissal of workers, including compensations for unused holiday;

reimbursement of other expenses, including the expenses involved in the improvement of professional skills of workers;

employment of workers dismissed as a result of reduction of work force, reorganization or liquidation of an organization;

performance by a natural person of his job duties (including relocation to work to another locality and reimbursement of travel and living expenses).

In case the taxpayer pays the expenses on business trips of workers both in the country and abroad, the daily allowance exempt from taxation shall be within the limits of standards established according to the legislation of the Russian Federation, and also the actually effected and documented target expenses in the travel up to destination and back, charges for airport services, the commission charges, expenses in travel to the airport or to the terminal in the places of departure, destination or changes, on conveyance, expenses in hiring housing, communication services expenses, charges for the issue (receipt) and registration of a service foreign passport, charges for granting (receipt) of visas, and also expenses in exchange of currency cash or cheques in a bank into foreign currency in cash. If no documents are presented to confirm the payment of expenses for hiring of housing, the amounts of such payment are exempted from taxation within the limits of standards established by the legislation of the Russian Federation. A similar order of taxation shall apply to disbursements effected to persons found in command of, or administrative subordination to, an organization, and also members of a board of directors or any similar body of the company coming to participate in meetings of the board of directors, the board of management or another similar body of such company;

3) the amounts of lump-sum subsistence benefit granted by the taxpayer:

to natural persons in connection with a natural disaster or other extraordinary circumstances of the purposes of reimbursing the material damages inflicted thereto or harm inflicted to their health and also to natural persons being victims of terrorist actions on the territory of the Russian Federation;

to members of the family of a deceased employee or to an employee in connection with the death of a member (members) of his/her family;

4) the amount of wage and other amounts in foreign currency paid to workers, and also servicemen sent to work (to serve) abroad by taxpayers who are state organizations or institutions funded from the federal budget, within the limits established by the legislation of the Russian Federation;

5) incomes of members of a country (farmer) household received in such a household from the production and sale of agricultural products and also from production of agricultural products, their processing and sale - during the five years after the registration year of the household.

The present provision shall apply to incomes of those members of a country (farmer) household who have earlier not used the provision;

6) incomes (except for wages of hired workers) received by members of registered in accordance with the established manner patrimonial, family communities of small ethnic groups of the North from the sale of products received as a result of pursuing their traditional types of craft;

7) the amounts of insurance premiums (contributions) for the compulsory insurance of employees accomplished by the taxpayer in the manner established by the legislation of the Russian Federation; the amounts of the taxpayer's premiums (contributions) under contracts of voluntary personal insurance of employees concluded at least for one year term that envisage that the insureds bear the medical expenses of these insured persons; the amounts of the taxpayer's premiums (contributions) under contracts of voluntary personal insurance of employees concluded exclusively for the onset of death of the insured person or for the loss of working ability by the insured person in connection with his/her exercising labour duties;

8) amounts paid to the charge of membership fees of gardening, gardening and vegetable gardening-, garage construction- and housing building co-operatives (partnerships) to persons for the performance of works (services) for said organizations;

9) travel expenses of workers and members of their families to the place of their holiday and back paid by the taxpayer to the persons working and living in areas of the Far North and areas equated thereto according to the legislation of the Russian Federation;

10) amounts paid to natural persons by election commissions, and also from the resources of election funds of candidates and registered candidates for the position of the President of the Russian Federation; candidates and registered candidate deputies of the State Duma; candidates and registered candidate deputies of legislative (representative) public power of a constituent entity of the Russian Federation; candidates and registered candidates for the position of chief executive of a constituent entity of the Russian Federation; candidates and registered candidates of an elected body of the local government; candidates and registered candidates for a position of the head of a municipal entity, candidates, registered candidates for the position in another federal state body, a state body of a constituent entity of the Russian Federation stipulated by the Constitution of the Russian Federation, by the Constitution, or charter of the constituent entity of the Russian Federation, and elected directly by citizens; candidates and registered candidates for another position in a body of local self-government stipulated by the charter of the municipal entity and filled in through direct ballot, of election funds of electoral associations and election blocks for such person's work directly associated with the conduct of election campaigns;

11) cost of service dress and utility uniform issued to workers, trainees and pupils according to the legislation of the Russian Federation and also to civil servants of federal executive governmental bodies free or against partial payment and remaining in their permanent personal use;

12) cost of travel privileges granted by the legislation of the Russian Federation to certain categories of workers, trainees and pupils;

13) disbursements made to the charge of members of trade-union contributions to each member of the trade union, provided that such disbursements in pecuniary form and in kind are made no more often than once every three months and do not exceed 10,000 roubles annually.

14) disbursements in kind in the form of goods of own production - agricultural products and/or children goods in an amount of up to 1,000 roubles (inclusive) per natural person being an employee per calendar month.

2. The following shall not be subject to taxation: disbursements effected for the benefit of the employees of organisations financed out of budget funds, not exceeding 2,000 roubles per individual in the tax period on each of the following grounds:";

the amounts of material help rendered by employers to their workers, and also former workers who have retired due to disability or old age;

the amounts of reimbursement (payment) by employers to their former workers (old age retirees and/or invalids) and/or members of their families of cost of drugs bought by them (for them) which were prescribed to them by a treating doctor.

3. The tax base (in the part of amounts of the tax subject to payment to the Social Insurance Fund of the Russian Federation), apart from disbursements specified in Items 1 and 2 of the present Article, shall also not include any compensations paid to the natural persons under civil contracts or author's or license agreements.