The accrual of personal income tax upon compensation upon dismissal deserves special attention

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Cash compensation for leave is paid to an employee in the event of his dismissal from the company. This payment is mandatory and is calculated according to certain rules. Special attention deserves preferential taxation of such a calculation.

In which case the employee is en titled to compensation payments for unused vacation

An employee who decides to change his job, subject to the availability of unclaimed vacation days, the employer is obliged to pay monetary compensation. Accountants quite often calculate such a payment, since almost everyone has vacation days on the day of dismissal.

Compensation for unused vacation upon dismissal is accrued not on the last day of the month, as it is customary to calculate wages, but on the term of the employee's dismissal. Naturally, such a calculation is also paid on the day the employee leaves. The amount of compensation payments directly depends on the number of days of all accumulated vacations and does not depend on the reason for dismissal.

From whattax exempt compensation payments

Compensation for unused vacation upon dismissal is a special income of the employee, so this accrual is subject to partial taxation. According to the current legislation, the compensation payment for unused vacation days is exempt from the accrual of insurance contributions to the pension and medical funds. Also, the calculation is not included in the tax base of the social insurance fund and does not participate in the calculation of contributions for injury insurance.

In connection with this benefit, the regulatory authorities are closely monitoring that compensation is accrued only in case of partial replacement of excess vacation days or upon dismissal of an employee. In other situations, the replacement of vacation with compensation is prohibited.

What taxes still have to be charged

When starting to calculate the compensation payment, many accountants are wondering whether compensation is subject to personal income tax upon dismissal. The Tax Code of the Russian Federation (Article 217, clause 3) states that such earnings are subject to income tax on a general basis, regardless of the reason for which the payment was accrued - in connection with the replacement of additional leave or dismissal.

Compensation for unclaimed leave also falls into the calculation base for income tax. The calculation amount is included in full, even if there is a reserve for vacation pay. If a company uses a simplified systemtaxation at a rate of 15%, then compensation also falls into the expense item in full (TC RF Art. 346.16).

How to reflect the tax in the calculation of 6-personal income tax

Despite the fact that the 6-personal income tax form contains only a couple of sheets, filling it out causes a lot of questions for accountants. Compensation upon dismissal in 6 personal income tax is reflected according to the general rules for filling out the form. But in this situation, you should pay close attention to the fact that in the reporting period you will have to enter data on two accruals: wages and vacation compensation. The difficulty lies in the fact that these two accruals can be calculated and paid in different periods of time. For example, personal income tax for compensation upon dismissal is accrued on the last working day of the resigning employee (TC RF Art. 223), and from salary - at the end of the month.

Payment for unused vacation is recorded in 6-personal income tax in two sections. In the first one, it is indicated in the amount of accrued income on line 020 (tax on lines 040 and 070). In the event that compensation is paid separately from other charges, then it is entered in a separate line in the calculation of 6-personal income tax. In the second section of the calculation on lines 100 and 110, you need to put down exactly the date that reflects the moment the compensation is paid to the employee.

Based on the data entered in the 6-NDFL form, the 2-NDFL form will be filled in the future. For this, the code 4800 is provided in the certificate, and personal income tax for compensation upon dismissal will be indicated in the total amount of tax.

Date of transfer of personal income tax upon compensationupon dismissal

Since compensation is subject to income tax, the required amount must be transferred to the budget in a timely manner. The compensation payment is not a remuneration, but is accrued to the employee instead of unused vacation, therefore, personal income tax upon dismissal compensation must be transferred on the day the funds are sent to the employee’s account or at the time of cash payment (TC RF Art. 226).