There is good news for entepreneur that are payers of single social contribution
Last week, namely May 13, 2020, the Verkhovna Rada of Ukraine adopted some important legislative acts. Among them, there are those that are important specifically for Entepreneur. In particular, the exemption from the payment of single social contribution “for themselves” by entepreneur and independent members of farms was extended for May. Also, for entrepreneurs who are on a common taxation system, they introduced the corresponding norm. According to it, they may not pay single social contribution for the months in which they did not make a profit. But this rule will be effective from 2021. That is, if we analyze these regulatory legal acts, then in accordance with the Law of Ukraine №3329, in May, individual entrepreneurs may not pay for themselves single social contribution.
At the same time, it is important that it does not take into account whether the entepreneur had income during this period or not. So, for the second quarter of 2020, entrepreneurs will need to pay single social contribution for only one month – June. The due date is until June 20, 2020. But the months in which the entepreneur was exempted from the payment of single social contribution will be taken into account in the experience.
When submitting reports, it is important not to show accruals for single social contribution in the form of D5, for months in which it is not required to be paid by law. Since, if indicated, it will be considered that the payer voluntarily decided to pay single social contribution for the months in which he was exempted from such payment.
The adopted law provides for many important changes, which include:
- extension of the amnesty for tax offenses, a ban on inspections (tax, documentary, accrual of single social contribution);
- the accrual of penalties for taxes and single social contribution has been stopped in accordance with the limitation periods provided for in Art. 102 of the Tax Code of Ukraine;
- the procedure for obtaining unemployment benefits in the event of partial unemployment has been slightly improved.
As for the latter, the Law stipulates that such assistance is not taxed. That is, it does not pay tax on personal income and military duty. Although this norm is already enshrined in the Tax Code of Ukraine, namely in paragraph 165.1.1.
In particular, it was noted that state aid, social assistance and other payments from the State budget are not included in the total monthly income, which should be taxed. Also included in the list of persons entitled to receive such assistance are individual entrepreneurs. That is, they will be able to get help not only for workers, but also for themselves, in case of stoppage of work and loss of income due to quarantine. The term for applying for help to the employment center was also extended to 90 days, previously it was 30 days from the day the work was suspended.
Single social contribution for entepreneur that are on the common taxation system
Very important changes have been made, as provided for in Bill № 2166, but they only come into force in 2021.
These changes include:
- Entepreneur on the general taxation system may not pay single social contribution “for themselves” in the month in which they do not receive income. This is provided for in paragraph 2 of Part 1 of Art. 7 of the Law of Ukraine “On the Unified Social Contribution”. For those entrepreneurs who were simply registered and did not pay single social contribution for themselves from 01/01/2017, there is an opportunity to write off the debt-arrears that were accrued to them for this period. For this, it is necessary to submit to the tax authorities an application and form D5, and an application to the state registrar on the termination of registration of an individual entrepreneur. If such a debt has already been paid, then it is not subject to return. In case of partial payment, only the part that has not yet been paid can be debited. Those taxpayers who, although they did not receive income, but paid single social contribution “for themselves”, will not be given back the funds.
- Entepreneur that are on the common taxation system or are single tax payers and work under an employment contract may not pay single social contribution for themselves if such an payment was made by the employer at the main place of work, but at a rate not lower than the insurance premium. This is provided for in Part 6 of Art. 4 of the Law of Ukraine “On the Unified Social Contribution”.
- The list of persons who may not pay single social contribution “for themselves” has increased. These are persons engaged in independent professional activities, if they are included in the list provided for in part 4 of Art. 4 of the Law “On the Unified Social Contribution”. Entepreneur, which are engaged in independent professional activities, members of farms that receive long service pensions may also not pay single social contribution “for themselves” if they have not reached the age prescribed by the Law “On Compulsory State Pension Insurance”.
Not related to persons who are exempted from the payment of single social contribution under Part 4 of Art. 4 of the Law of Ukraine “On single social contribution” persons:
- receiving a survivor’s pension and have not reached the age specified in art. 26 Law of Ukraine “On Compulsory State Pension Insurance”;
- receiving a pension for length of service and have not reached the age specified in Art. 26 Law of Ukraine “On Compulsory State Pension Insurance”.
Author: Kristina Vorozhbitova