EMPLOYEE PURCHASES GOODS FOR YOUR MONEY

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Recall: the fiscals, whose illegal explanations about the taxation of the so-called credit sub-report of personal income tax and military policy began to be canceled by the courts, appealed for support to the Ministry of Finance. Fortunately, neither the courts nor the Ministry of Finance supported the fiscal position and, in fact, the overseers had to “back down” in this matter.

The Ministry of Finance first voiced its vision of the situation in a letter dated February 26, 2019 No. 11220-16-63 / 5675. But! The Ministry of Finance still insists on the condition of "labor function".

Accordingly, if:

1) the purchase of goods / services is carried out by the employee at his own expense in connection with the performance of the work assigned to him (labor function) - then this is not the income of an individual. And neither personal income tax, nor a military unit when paying compensation to an individual does not need to be withheld;

2) but if the purchase of goods / services, which is carried out by the employee in favor of the employer at his own expense, is not related to the performance of labor functions, then this is the income of a physical person (it is believed that the employee sold the goods / services to the enterprise). With such income should be withheld personal income tax and military collection.

Given this position of the Ministry of Finance, our recommendations: approve the list of employees (positions) who have the right to carry out the relevant procurement for the enterprise. Better yet, define it as one of the responsibilities in the job description / employment contract.

We also recommend that the order fix a list of goods that can be purchased by employees for the needs of the enterprise.

And do not forget about the advance report!

In our opinion, it should not matter, in the framework of labor or civil-legal relations compensation is paid to an individual. If an employee purchases goods and materials for an employer at his own expense, who does not have this in his labor duties, then the relations between them are of a civil law nature.