Can the sole founder be a director? The only founder and director in one person
For ten years now, various ministries and departments have been giving contradictory, sometimes directly opposite, answers to the question:
“Should the head of a company, who is its sole founder, pay himself a salary, withhold personal income tax from it and transfer it to the budget, and also pay insurance premiums for mandatory pension, medical and social insurance?»
Managers and business owners often ask the question: Should the sole founder, who is the head of his own business, enter into an employment contract with himself and, accordingly, pay himself a salary, and from it - withhold personal income tax (13% to the budget), as well as charge insurance premiums (30%)?
Can the founder-director be considered an employee of the organization? Indeed, in accordance with Article 273 Labor Code, the only founder, who is the general director, is not on the staff of the organization.
Today, the following practice is emerging: the manager, who is the sole founder of the company, SHOULD NOT pay himself a salary, and, therefore, personal income tax and insurance contributions from his salary.
Our legislation provides the following explanations.
Explanation 1 – “From the perspective labor legislation»
Here, for example, is letter dated October 17, 2014 No. 03-11-11/52558, in which Ministry of Finance appeals to norms labor legislation:
“According to articles 57, 129 and 135 of the Labor Code Russian Federation(hereinafter referred to as the Labor Code of the Russian Federation) under wages(employee remuneration) refers to the remuneration for labor that is paid to the employee in accordance with the concluded employment contract.
Article 56 of the Labor Code of the Russian Federation stipulates that an employment contract involves two parties: the employee and the employer. In accordance with Article 20 of the Labor Code of the Russian Federation, an employee is an individual who has entered into labor Relations with the employer, and the employer is an individual or entity(organization) that has entered into an employment relationship with the employee. In cases provided for by federal laws, another entity entitled to enter into employment contracts may act as an employer. In the absence of one of the parties employment contract it cannot be concluded.
Consequently, the head of the organization, who is its sole founder and member of the organization, cannot accrue and pay to himself wages.
Based on this, the above-mentioned head of the organization does not have the right to take into account as expenses when determining the object of taxation for the unified agricultural tax as labor costs incurred expenses in the form of paying himself wages. The calculation of insurance contributions to extra-budgetary funds and personal income tax in this case is also not carried out.”
And here is an even more recent opinion of the Ministry of Finance (letter dated February 19, 2015 No. 03-11-06/2/7790): “the head of an organization, who is its sole founder and member of the organization, cannot calculate and pay wages to himself.”
Another department - Rostrud - earlier in its letter dated December 28, 2006 No. 2262 6 1 noted that the signing of an employment contract by the same person both on behalf of the employee and on behalf of the employer is unacceptable, and, therefore, the sole founder cannot to be the only employee of the organization by virtue of Article 273 of the Labor Code of the Russian Federation. This means that in this case there is no need to conclude an employment contract.
Explanation 2 – “From the perspective of civil law”
The new norms of the Civil Code of the Russian Federation, which came into force on September 1, 2014, strengthened the opinion that The labor code does not apply to the relations of the sole founder with the company founded by him.
Since September 2014, amendments to the Civil Code of the Russian Federation came into force. In particular, in Art. 53 of the Civil Code of the Russian Federation, a new paragraph 4 has been introduced, which states: relations between a legal entity and persons included in its bodies are regulated by this Code and laws on legal entities adopted in accordance with it, and therefore these relations (including labor ) regulated by civil law, that is, they are removed from the scope of labor legislation.
Norms Labor Code are aimed at regulating the relationship between the employee (a person initially dependent on the one who hires him) and the employer with one sole purpose: provide the employee protection his rights, getting everyone guarantees And compensation provided for by labor legislation.
A supervisor –sole founder such does not require employer guarantees, since no one hired him for work and, accordingly, no one is going to violate his labor rights and no one is knowingly depriving him of any guarantees. Therefore, the relationship between the founder and the company he founded should be considered exclusively within the framework of civil law.
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In a situation where the only participant (founder) performs the functions of the sole executive body(directors, general director), as directors we are often asked 2 questions:
If an employment contract is concluded, is it possible to take into account the director’s salary as an expense for income tax purposes?
Does a business owner need to enter into an employment contract to perform the functions of director of an organization?
The legislation does not provide a clear answer to the question of how to formalize the relationship between an organization and its leading member (founder). Rostrud insists that there cannot be an employment contract with the director - the only participant. The Russian Ministry of Finance indicates that you cannot pay your own salary, but if there is an agreement between the legal entity and the manager, then the expenses can be taken into account. The courts clearly say that an employment contract must be concluded.
As we see, there is no consensus on this issue: some (theorists) are of the opinion that in such a situation an employment contract cannot be concluded, others (practitioners) believe that an employment contract in this case is an urgent necessity.
What should an organization do in such a situation: should it draw up an employment contract with the director or not? Is it worth it to include the manager’s salary as expenses or not? Let's analyze it.
Theorists(for example, Y.P. Orlovsky in the Commentary to the Labor Code of the Russian Federation) argue that:
employment contracts are not concluded with managers who are the only participants in organizations, since labor legislation does not apply to them;
a participant (the sole founder of the organization) cannot conclude an employment contract with himself,
and justify their position with the following arguments:
such a prohibition is directly provided for by Part 2 of Article 273 of the Labor Code of the Russian Federation (hereinafter referred to as the Labor Code);
if such an employment contract is concluded, then the norms of Chapter 43 of the Labor Code cannot be applied to it, which means that such a person can work in the company as anyone, but not as a manager, because legal regulation of the work of the head of an organization can only be implemented through the application of the norms of Chapter 43 of the Labor Code;
the nature of the employment relationship is hired (self-employed) work. In the situation described above, the lack of independence of labor is lost, since he exercises employer powers in relation to himself.
Currently, this point of view is shared by Rostrud (Letter dated March 6, 2013 No. 177-6-1) and the Ministry of Finance of Russia (Letter dated October 17, 2014 No. 03-11-11/52558), i.e. in fact, officials deny the very possibility of labor relations.
The same point of view was previously held by the Ministry of Health and Social Development of Russia, justifying it by the fact that the basis of Part 2 of Article 273 of the Labor Code is the impossibility of concluding an employment contract with oneself, since the organization simply does not have other participants (members, founders). Sole participant in this situation, the company must, by its decision, assume the functions of the sole executive body - director, general director, president, etc. Management activities in this case, in our opinion, it is carried out without concluding any contract, including a labor contract (Letter of the Ministry of Health and Social Development of the Russian Federation dated August 18, 2009 No. 22-2-3199). But later the Ministry of Health and Social Development of Russia changed its point of view to the opposite (Letter of the Ministry of Health and Social Development of the Russian Federation dated 06/08/2010 No. 428n), justifying it by the fact that only in this way can the manager be provided with social and labor guarantees.
Note: this position of officials can be beneficial at the initial stage of launching a business project, because when the activity does not yet generate any income, then there is no need for extra expenses (in the absence of an employment contract, salaries are not paid, insurance premiums are not charged).
Practices based on the fact that:
laws don't prohibit the sole participant (founder, member, owner of property) of the organization becomes its leader (i.e., manages this organization, including performing the functions of its sole executive body). So from Article 88 of the Civil Code and Articles 2, 7, 11 of the Federal Law "On Societies with limited liability"(hereinafter referred to as the Law on LLC) it follows that an LLC can be founded by one person or may consist of one person. And from Article 39 of the Law on LLC it follows that the highest management body in an LLC is the general meeting of its participants; if there is only one participant, he and makes decisions of the sole participant. The sole founder of the company himself decides who will manage the organization. The law does not prohibit the founder of the company, as the sole executive body, from assigning these responsibilities to himself (Article 40 of the LLC Law);
the only founder holding the position of manager personally performs for the organization labor function under its leadership current activities, he works in the interests of a legal entity, he is given workplace and other working conditions are provided;
labor legislation applies to such managers, and in labor relations with the organization they manage, they are employees.
This point of view is also shared by judicial practice. The courts believe that such managers (along with any other employees) have the right to receive social benefits (for temporary disability, pregnancy and childbirth, etc.) from the Social Insurance Fund. For example:
in Definition Supreme Court RF dated 02.28.2014 No. 41-KG13-37 notes that if the relationship between an organization and its leader, who is the sole participant (founder) of this organization and the owner of its property, is formalized by an employment contract, the general provisions of the Labor Code of the Russian Federation apply to the said leader.
The Supreme Arbitration Court of the Russian Federation dated 06/05/2009 No. VAS-6362/09 in case No. A51-6093/2008,20-161 in the Determination substantiated this position with the following arguments:
in accordance with Article 273 of the Labor Code, the provisions of Chapter 43 on the specifics of regulating the labor of the head of an organization and members of the collegial executive body of organizations apply to heads of organizations regardless of their organizational and legal forms and forms of ownership, except in cases where the head of the organization is the only participant (founder) , a member of the organization, the owner of its property. Stated position does not mean, What's on specified persons does not apply to the Labor Code of the Russian Federation. Otherwise it would violate them labor rights;
Article 16 of the Labor Code stipulates that labor relations that arise as a result of election and appointment to a position are characterized as labor relations on the basis of an employment contract;
By virtue of Article 39 of the LLC Law, the appointment of a person to the position of director is formalized by the decision of the sole founder of the company, therefore, labor relations with the director as an employee are formalized not by an employment contract, but by the decision of the sole participant.
Accordingly, such an employee, who has a labor relationship with the company, has the right to compulsory social insurance provided for by the Labor Code of the Russian Federation and the Federal Law “On the Fundamentals of Compulsory Social Insurance”.
The FAS of the West Siberian District in the Resolution of the FAS of the West Siberian District dated November 18, 2009 in case No. A45-11064/2009 indicated: “According to Article 6 of the Federal Law of July 16, 1999 No. 165-FZ “On the Basics of Compulsory Social Insurance” ( hereinafter referred to as Law No. 165-FZ), the subjects of compulsory social insurance are policyholders (employers) and citizens of the Russian Federation working under employment contracts.
Article 9 of Law No. 165-FZ establishes that relations under compulsory social insurance arise for all types of compulsory social insurance from the moment an employment contract is concluded with an employee;
in accordance with Articles 11, 16 of the Labor Code of the Russian Federation, labor relations that arise as a result of the election or appointment of a director of a company are characterized as labor relations on the basis of an employment contract. A person appointed to the position of director of a company is its employee, and the relationship between the company and the director as an employee is regulated by labor law.
According to Article 7 of the Federal Law of February 8, 1998 No. 14-FZ “On Limited Liability Companies” (hereinafter referred to as Law No. 14-FZ), a company can be founded by one person, who becomes its sole founder. The same person can also make a decision to appoint a director if for this purpose a general meeting of the company’s participants is impossible, since only one person who acted as a founder when creating the company is its participant.
From the foregoing it follows that a limited liability company may include one participant, who has the right to perform the functions of the head of a limited liability company, i.e. be his employee.
The provisions of the Labor Code of the Russian Federation do not contain rules prohibiting the use general provisions Code to labor relations when there is a coincidence of an employee and an employer in one person, although the application to such legal relations of the provisions of Chapter 43 of the Labor Code of the Russian Federation is excluded. Consequently, the employee has the right to maternity leave with the payment of benefits under state social insurance in the amount established by law, while the argument of the Social Insurance Fund that... there is no status of a person insured under compulsory social insurance was rightfully rejected by the court as insolvent
This point of view is indirectly confirmed by the state. organs. Thus, the Pension Fund of the Russian Federation in its Letter dated 05/06/2016 No. 08-22/6356 “On reporting” indicated the following:
In accordance with paragraph 2.2 of Article 11 of the Federal Law of 04/01/1996 N 27-FZ “On individual (personalized) accounting in the compulsory pension insurance system” (which entered into force on 04/01/2016), the policyholder provides monthly information about each insured person working for him . Reporting is presented in the form SZV-M, approved by Resolution of the Board of the Pension Fund of the Russian Federation dated 01.02.2016 N 83p.
When implementing this norm, working citizens are understood to mean the persons specified in Article 7 of the Federal Law of December 15, 2001 N 167-FZ "On Compulsory Pension Insurance in the Russian Federation", which includes those working under an employment contract, including heads of organizations who are the only participants (founders), members of organizations.
absence of the fact of accrual of payments and other remuneration in favor of the above-mentioned persons for reporting period are not grounds for failure to submit reports in relation to these persons in the SZV-M form.
Thus, these persons are subject to the compulsory pension insurance regime and upon payment of insurance premiums they acquire pension rights.
Accordingly, these policyholders must submit to the authorities on a monthly basis Pension Fund Russian Federation information about each insured person working for him.
Is it possible to include a director's salary as an expense for income tax purposes?
Discussions about whether it is necessary to conclude an employment contract with the sole founder of the organization or whether one should do as officials advise (assign the functions of a manager without concluding any contract to oneself (the person who is the sole founder)) would not be so relevant if not one but. The fact is that, according to tax law, expenses for paying wages can be taken into account for tax purposes only if:
labor relations (Article 255 of the Tax Code of the Russian Federation);
civil relations(clause 21 of article 255 of the Tax Code of the Russian Federation).
By virtue of clause 21 of Art. 270 of the Tax Code of the Russian Federation, when determining the tax base, expenses for any types of remuneration provided to management or employees, in addition to remunerations paid on the basis of employment contracts, are not taken into account. Therefore, even if a civil contract has been concluded with the head of an organization, accounting for the costs of paying him remuneration is associated with tax risks.
In the field of small business, a common situation is when the sole founder of the company is its leader. Is it necessary to conclude an employment contract with such an employee and to accrue contributions from accidents on his salary? Let's try to figure it out and consider the answers of several experts.
Expert Answer No. 1
The general director of the organization is also its founder. Is there an employment contract with the manager? Who signs it?
According to paragraph 4 of Art. 40 of the Federal Law of 02/08/98 N 14-FZ “On Limited Liability Companies” (hereinafter referred to as the LLC Law), the procedure for the activities of the general director of the company and his decision-making is established by the company’s charter, internal documents of the company, as well as an AGREEMENT concluded between the company and general director.
According to part three of Art. eleven Labor Code of the Russian Federation ( Labor Code of the Russian Federation) All employers (individuals and legal entities, regardless of their organizational and legal forms and forms of ownership) in labor relations and other directly related relations with employees are obliged to be guided by the provisions of labor legislation and other acts containing labor law norms.
In accordance with Art. 16
Labor Code of the Russian Federation ( Labor Code of the Russian Federation) labor relations between an employee and an employer arise on the basis of an employment contract concluded in accordance with Labor Code of the Russian Federation ( Labor Code of the Russian Federation) , and the labor relations that arise as a result of the election or appointment to the position of a director of the company are also characterized as labor relations on the basis of an employment contract. From articles 56, 59, 275 Labor Code of the Russian Federation ( Labor Code of the Russian Federation) It also follows that an EMPLOYMENT CONTRACT must be concluded with the head of the organization.Thus, the general director is at the same time the sole executive body of a legal entity, including a limited liability company (LLC) (Articles 53, 91
Civil Code of the Russian Federation ( Civil Code of the Russian Federation) ), and his employee (part six of article 11 Labor Code of the Russian Federation ( Labor Code of the Russian Federation) ). The activities of the general director as the sole executive body of the company are regulated by the norms of civil legislation, and as an employee - by the norms of labor legislation.Therefore, an employment contract must be signed with the general director.
At the same time, if he is the sole founder of the LLC, some peculiarities appear.
Clause 1 of Art. 40 The LLC Law establishes that the sole executive body of the company is elected general meeting members of the company, and the AGREEMENT WITH IT IS SIGNED BY THE PERSON who chaired the general meeting of participants or AUTHORIZED BY THE GENERAL MEETING OF PARTICIPANTS.
FEATURES OF LEGAL REGULATION OF MANAGER'S LABOR are defined in Chapter 43 of the Labor Code of the Russian Federation, however, in Art. 273
Labor Code of the Russian Federation ( Labor Code of the Russian Federation) It is stated that the provisions of this chapter do not apply to cases where the head of the organization is the only participant in the legal entity. Regarding the last case, special mention should be made.IF THE GENERAL DIRECTOR IS THE SOLE FOUNDER OF THE LLC, the following must be taken into account:
In accordance with Art. 39 of the Law on LLC, if the company consists of one participant, the functions of the general meeting of company participants are performed by the sole participant of the company individually and are documented in writing.
Civil legislation does not limit the ability of an individual - the sole founder of a legal entity - to appoint himself as the sole executive body, and labor legislation does not contain reservations regarding the effect of its norms on such managers or the absence of the need to formalize labor relations with them.
Thus, in this case too an employment contract must be drawn up.
The fact that the signatures of both parties to the employment contract are affixed by the same person, acting both as an employee (general director) and as the management body of the employer, does not contradict the law. Provision of paragraph 3 of Article 182
Civil Code of the Russian Federation ( Civil Code of the Russian Federation) , according to which a representative cannot make transactions on behalf of the represented person in relation to himself personally, does not apply to labor relations (Article 2 Civil Code of the Russian Federation ( Civil Code of the Russian Federation) ).We consider it necessary to note that there is another point of view, which we consider erroneous, that in the case where the manager is the only participant in the organization, an employment contract should not be concluded. This position was once expressed in a letter dated December 28, 2006 N 2262-6-1 federal Service on labor and employment (Rostrud). Rostrud justified its position by the fact that an employment contract cannot be concluded, since in such a situation “there is no employer in relation to the general director,” meaning that in this case the employee and the employer are the same person. And the Social Insurance Fund of the Russian Federation, in a letter dated June 27, 2005 N 02-18/06-5674, explaining the issue of compulsory social insurance against accidents at work, generally concluded that cases where the head of an organization is the sole owner of its property, are not regulated by labor laws.
Once again we would like to note that we consider this position to be erroneous and not based on legal norms (the letters themselves, due to their status regulations are not), since it does not take into account any of the above provisions of Art. 11, 16 Labor Code of the Russian Federation ( Labor Code of the Russian Federation) , nor the provisions of Art. 20 Labor Code of the Russian Federation ( Labor Code of the Russian Federation) , according to which the employer is the organization itself (legal entity), and not the founder or, especially, the director. And it is the legal entity, regardless of the number and status of participants, that, through its bodies, independently acquires rights and bears responsibilities as an employer.
This position has received support in judicial practice - see Resolution of the Federal Antimonopoly Service of the North-Western District dated May 19, 2004 N A13-7545/03-20, Resolution of the Federal Antimonopoly Service of the Ural District dated September 17, 2007 N F09-2855/07-S1, Resolution of the Federal Antimonopoly Service of the West Siberian District dated December 5, 2007 N F04-8301/2007(40653-A45-25).
As for the form of the contract for this case, we remind you that the features legal regulation labor of a manager, defined in Chapter 43 Labor Code of the Russian Federation ( Labor Code of the Russian Federation) , according to Art. 273 Labor Code of the Russian Federation ( Labor Code of the Russian Federation) do not apply to cases where the head of the organization is the only participant of the legal entity.
Thus, in this case we can only say that such an agreement must comply general requirements labor legislation. The content of the employment contract is regulated by Art. 57 Labor Code of the Russian Federation ( Labor Code of the Russian Federation) .
CONCLUSION:
The conclusion of an employment contract with the general director, who is also the founder, is mandatory, regardless of whether he is the sole founder of the company or not.
If the general director is not the sole founder of the company, then he is elected by the general meeting of participants of the company, and the agreement with him is signed by the person who chaired the general meeting of participants or authorized by the general meeting of participants.
If the general director is at the same time the sole founder of the company, then he makes the sole decision to appoint himself as general director, and signs an employment contract on both sides, on the one hand, as an employee, on the other hand, as a representative of the employer (legal entity).
Prepared answer:
Expert of the Legal Consulting Service GARANT
Goryunova Olga
Checked the answer:
Reviewer of the Legal Consulting Service GARANT
Serkov Arkady
Moscow
Expert Answer No. 2
The specifics of regulating the work of the head of an organization are specified in Chapter 43 of the Labor Code. However, the provisions of this chapter do not apply to cases where the director is the only founder (Article 273 of the Labor Code of the Russian Federation). This norm is understood in different ways.
Recruitment
Some experts believe that there is no need to enter into an employment contract with the director, who is the sole founder. It's hard to agree with this. After all, the director makes decisions, issues orders, manages the activities of the company, etc. Consequently, labor relations arise between him and the organization. They are formalized by an employment contract (Articles 15, 16 of the Labor Code of the Russian Federation).
In general cases, an agreement with the manager is concluded on certain period. This is stated in Article 275 of Chapter 43 of the Labor Code. But since this chapter does not apply in the situation “the owner himself is the director himself,” the contract can be concluded for an indefinite period.
An employment contract is signed by two parties - the employer and the employee. What to do in our situation? It turns out that the employer and the employee are one person. There are two possible options here.
Firstly, the director can enter into an employment contract with himself. True, in paragraph 3 of Article 182 Civil Code There is a clause that a company representative cannot enter into transactions in relation to himself personally. But this provision applies specifically in civil law, for example, in relation to business contracts. Labor legislation specifies only one case of cancellation of a contract with an employee - if he does not start work within a week (Article 61 of the Labor Code of the Russian Federation). This situation has nothing to do with the issue of signing an employment contract by the same person.
The second option is that the contract can be signed on behalf of the company by one of the company’s employees. For example, this could be a member of the HR department.
Hiring is formalized by order (Article 68 of the Labor Code of the Russian Federation). The form of this document (Form No. T-1) was approved by Decree of the State Statistics Committee of Russia dated January 5, 2004 No. 1. The document is signed by the head of the organization, and the employee signs his “autograph”, notifying that he has read the order. Since this is the same person, the director can sign the document himself. Or another employee will sign the order on behalf of the company.
Like any other employee, a personal card is issued for the manager. For this purpose, a form in form No. T-2 is provided.
If the work for the director in the company he created is the main one, then you need to make an entry in his work book(Article 66 of the Labor Code of the Russian Federation). The rules for filling it out are specified in the instructions, which were approved by Resolution of the Ministry of Labor of Russia dated October 10, 2003 No. 69.
So, in column 3 of the “Work Information” section, you need to write down the full name of the organization as a heading. If there is an abbreviated name, indicate that too. Under this heading, in column 1, enter the serial number of the entry, and in column 2, indicate the date of employment. Next, in column 3, write down: “Hired to the position of director.” In column 4, enter the date and number of the hiring order, according to which the director began to perform his duties (for example: order dated September 5, 2005 No. 1).
Everything according to the code
The director, like any employee, is subject to the guarantees provided for in labor legislation. For example, days off, sick leave payments.
It happens that the director is not only the only founder, but also the only employee. But even this fact does not limit his right to leave. Thus, Article 124 of the Labor Code prohibits working without rest for two years in a row.
Like any employee, the director is entitled to a salary. According to Article 136 of the Labor Code, it must be issued every six months. The minimum monthly salary should not be lower than one minimum wage (Article 133 of the Labor Code of the Russian Federation). From September 1, 2005, this value is 800 rubles (Federal Law of December 29, 2004 No. 198-FZ).
Can a director who is the sole founder work without paying a salary? The Labor Code does not establish exceptions for any category of employees. Therefore, the working director will have to pay his salary.
This legal requirement can be circumvented if the director goes on vacation “at his own expense.” But this option is not suitable for all companies. For example, it can be used by those organizations that have “frozen” their business and only the manager himself is on staff. But when an enterprise conducts business activities, the absence of a director looks very strange. After all, he has to sign contracts, payment documents, reports, etc. This will be an indicator that the director actually fulfills his duties, and, therefore, he is entitled to a salary with all that it entails tax consequences.
Payments to the budget and funds
The director's salary is included in expenses when calculating income tax (Article 255 of the Tax Code of the Russian Federation). The supporting document for such expenses is the employment contract. This once again confirms that such a document must be drawn up.
Unified social tax and pension contributions are accrued on the director's salary (clause 1 of article 236 of the Tax Code of the Russian Federation, clause 2 of article 10 of the Federal Law of December 15, 2001 No. 167-FZ). In addition, you need to withhold personal income tax. When calculating taxes, the accountant should make sure whether standard tax deductions can be provided to the director (Article 218 of the Tax Code of the Russian Federation). Their amount is 400 rubles per employee and 600 rubles for each of his children. Deductions are provided until the month in which the employee’s income exceeded 20,000 and 40,000 rubles, respectively.
Is the founding director subject to accident insurance? Employees of the FSS of the Russian Federation tried to answer this question in a letter dated June 27, 2005 No. 02-18/06-5674.
Unfortunately, the social insurance companies did not provide clear explanations. Moreover, they cited a somewhat strange phrase that can mislead an accountant. According to the fund’s employees, “cases when the head of an organization is the sole owner of its property are not regulated by labor legislation.” After that, they reminded that citizens with whom an employment contract was concluded are subject to accident insurance.
Following this formulation, one might think that an employment contract is not concluded with the founding director, and, therefore, he is not subject to accident insurance. It turns out that there is no need to pay contributions on his salary.
However, the statement that the founding director is not subject to labor laws is incorrect. In these cases, only Chapter 43 of the Labor Code does not apply. It presents some features of labor regulation for managers. For example, if such an employee wants to work part-time in another company, then he needs to obtain permission from the owner of the company (Article 276 of the Labor Code of the Russian Federation). Other provisions of labor legislation apply to all employees.
As we have already found out, an employment contract is concluded with the director. Consequently, he is subject to social insurance (Article 5 of the Federal Law of July 24, 1998 No. 125-FZ). Therefore, insurance premiums against accidents are added to the manager’s salary. Their size depends on the occupational risk class assigned to the enterprise.
T. Averina, expert
The question - “whether or not to conclude an employment contract between the founder and the manager if this is one individual” is in this list key.
If we turn to the labor legislation that regulates labor relations and relations directly related to it, we will see that the legislator has not directly established in the Labor Code of the Russian Federation (hereinafter referred to as the Labor Code) the need to conclude an employment contract between the founder and the manager, if this is the same person; There is also no direct prohibition on concluding such an agreement.
Article 16 of the Labor Code states that labor relations arise between an employee and an employer on the basis of an employment contract concluded by them in accordance with this Code, including as a result of appointment to a position or confirmation in a position. 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 representative in the case where the employment contract was not properly drawn up.
Article 273 of the Tax Code of the Russian Federation states that the provisions of Chapter 43 of the Labor Code do not apply to the situation when the head of the organization and its sole founder are the same person. The specified 43rd chapter of the Labor Code considers the peculiarities of regulating the work of the head of the organization.
What does this collectively mean? The fact that an employment relationship between one individual (like any other relationship) does not arise at all, or that an employment relationship arises even without a contract, or another meaning, remains a question. Lawyers, employees personnel services, judicial authorities interpret this problem differently; just look at any legal reference system.
Official bodies, judging by the documents they issue, do not have a unified approach.
Thus, in some letters it was concluded that the conclusion of an employment contract between the sole founder and the manager, if they are the same person, is not possible on the basis of Art. 273 of the Labor Code of the Russian Federation, (Federal Service for Labor and Employment, Letter dated December 28, 2006 of the Russian Federation No. 2262-6-1; Ministry of Health and Social Development of the Russian Federation, Letter dated August 18, 2009 No. 22-2-3199).
There is an example of a consultation with the Federal Tax Service on a private issue, which also confirms this approach - no agreement is concluded.
Other letters indirectly indicated the possibility of the existence of such an agreement. So, for example, from the letter of the Ministry of Finance of the Russian Federation dated 09/07/2009 No. 03-04-07-02/13 regarding the Unified Social Tax, it follows that an employment contract can be concluded between an individual (manager) and the sole founder (as a representative of the organization).
Order of the Ministry of Health and Social Development No. 428n reflects the following: the head of an organization who is in labor relations with this organization, as well as in the case when he is the only founder (participant), member of the organization, owner of its property, for the purpose of compulsory social insurance in case of temporary disability and in connection with maternity, applies to persons working under an employment contract.
Federal Law No. 379-FZ also indirectly confirms the legality of the existence of an employment contract between the sole founder and the manager in one person. This law amended the Federal laws“On compulsory social insurance in case of temporary disability and in connection with maternity” No. 255-FZ; “On compulsory pension insurance in the Russian Federation” No. 167-FZ, “On compulsory health insurance in the Russian Federation” No. 326-FZ. The meaning of the amendments enshrined in paragraphs. "b" clause 2 of Art. 3, Art. 5 and art. 7, Law No. 379-FZ, is that if the manager (who is also the only founder) works under an employment contract, he is also an insured person.
The courts believe that a manager appointed to a position by decision of the founder is his employee, even if an employment contract has not been signed. The courts also recognize the legality of employment contracts signed by one person.
Thus, due to the uncertainty of the legislation and the presence of different interpretations, if a situation arises where the manager and the sole founder are one person, each founder independently decides whether an employment contract will be concluded or not. It is clear that such an employment contract is signed on behalf of the employer and on behalf of the employee by the same individual. It can be formulated, for example, as follows: LLC (name) represented by the director (full name), hereinafter referred to as the Company, on the one hand, and the citizen (full name), hereinafter referred to as the General Director, concluded this employment contract...
The form of the employment contract with the manager is developed independently, taking into account the requirements of the Labor Code of the Russian Federation. The duration of such an employment contract is determined by the charter (indefinite, fixed-term).
We also note that in any case, the founder secures the status of a manager by his decision. The wording can be free, for example, “By this decision, I assume the duties of the sole executive body - the General Director without drawing up an employment contract (with drawing up an employment contract).”
When concluding an employment contract, the employee presents a work book, this is stated in Art. 65 of the Labor Code of the Russian Federation, and the employer maintains this work book (makes appropriate entries), in accordance with the procedure established in Art. 66 Labor Code of the Russian Federation.
The answer to the question “whether to accrue wages or not, and what personal income tax rate to apply in this case” depends on what decision was made on the previous question.
If the employment contract has been signed, formally there is a basis for calculating wages based on the terms of the employment contract and the working time sheet.
The personal income tax rate is applied on the basis of clause 1 of Art. 224 of the Tax Code of the Russian Federation: 13% - for tax residents, and 30% - for non-residents, clause 4 of Art. 224 Tax Code of the Russian Federation.
If a decision was made not to conclude an employment contract, then on the basis of Art. 43 of the Tax Code of the Russian Federation, payments that an individual founder-manager will receive when distributing profits remaining after taxation should be considered as dividends. It should be noted that as long as there is uncertainty in the legislation, which we discussed above, there remains the risk of disputes with regulatory authorities on the issue of additional personal income tax assessment based on a rate of 13%. Availability judicial practice speaks of the possibility of such disputes. In this situation, in our opinion, there is a high probability of defending one’s position both in court and in pre-trial proceedings, relying on arbitration practice that is positive for the taxpayer.
If the employment contract is not signed and there is a decision of the founder to calculate wages for performing the duties of a manager without concluding an employment contract (this practice also exists), personal income tax should be calculated at the same rate as in the presence of an employment contract. The author does not recommend using this option, as it is associated with income tax risks. After all, recognition of expenses for wages and insurance premiums is possible if there is an employment contract; this will be discussed further.
Is it necessary to accrue dividends to the only participant if he works under an employment contract?
Yes, it is necessary if there is a corresponding decision of the founder. According to articles 31, 32 of the Law “On joint stock companies» No. 208-FZ, shareholders have the right to dividends. In accordance with paragraph 1 of Art. 8 of the Law “On Limited Liability Companies” No. 14-FZ, company participants have the right to participate in the distribution of profits. There are no restrictions in the form of an employment contract.
It should be remembered that it is important to document the payment of dividends; in the absence of a founder’s decision, dividends can be reclassified as wages, with all the corresponding tax consequences (the author draws attention to this, since in practice quite often the founder-manager in one person approaches the issue carelessly documentation their decisions). Interim and annual dividends are allowed to be paid. The decision to pay interim dividends may be based on performance results for each quarter. The decision to pay annual dividends is made based on the results of work for the year.
Taxation of dividends is quite simple.
In accordance with paragraph 4 of Art. 224 of the Tax Code of the Russian Federation, dividends from individuals who are tax residents of the Russian Federation are subject to personal income tax at a tax rate of 9%. Dividends from individuals who are not tax residents of the Russian Federation are taxed at a rate of 15%.
When paying dividends, personal income tax is withheld by the tax agent (employer) and transferred to the budget. In paragraph 4 of Art. 226 of the Tax Code of the Russian Federation stipulates that tax agents are obliged to withhold the accrued amount of tax directly from the taxpayer’s income upon their actual payment.
Dividends are not included in expenses taken into account for profit tax purposes; this is expressly stated in clause 1 of Art. 270 Tax Code of the Russian Federation.
Insurance premiums are not charged, since dividends are not related to wages.
Tax deductions (standard, property, social, professional) are not applied, which is enshrined in clause 4 of Art. 210 Tax Code of the Russian Federation.
For example
The founder-manager, a tax resident of the Russian Federation, decided to accrue annual dividends for 2011 in the amount of 1,500 thousand rubles.
IN accounting On the date of the decision the following entry is made:
“dividends of 1,500 thousand rubles were accrued.”
when paying dividends:
“dividends of 1,365 thousand rubles were transferred. (1500-1500*9%),
personal income tax withheld 135 thousand rubles. (1500*9%),
personal income tax was transferred to the budget in the amount of 135 thousand rubles.”
If wages are accrued, is it legal to recognize them for tax accounting purposes, and what insurance premiums should be charged?
Based on Article 255, the taxpayer’s expenses for wages include any accruals to employees provided for by the laws of the Russian Federation, labor agreements (contracts) and (or) collective agreements.
In paragraph 21 of Art. 270 of the Tax Code of the Russian Federation stipulates that when determining the tax base, expenses in the form of expenses for any types of remuneration provided to management or employees in addition to remuneration paid on the basis of employment agreements (contracts) are not taken into account.
With regard to compulsory pension insurance, compulsory social insurance, compulsory medical insurance, it should be said that on the basis of Law No. 379-FZ, which was mentioned when discussing the first issue, which came into force on January 1, 2012, insured persons include, among others, managers organizations that are the only participants (founders), if they work under an employment contract. Based on Art. 264 amounts of insurance contributions to the Pension Fund of the Russian Federation for compulsory pension insurance, to the Social Insurance Fund of the Russian Federation for compulsory social insurance in case of temporary disability and in connection with maternity, to the Federal Compulsory Medical Insurance Fund and territorial compulsory medical insurance funds for compulsory medical insurance , accrued in the manner established by the legislation of the Russian Federation, relate to other expenses associated with production and sales.
Thus, if there is an employment contract, both the amount of wages and the amount of compulsory insurance contributions are recognized as expenses. In the absence of an employment contract, expenses for wages and insurance contributions are not taken into account for tax purposes.
Option I
The sole founder-manager signed an employment contract. He is a tax resident of the Russian Federation and has one child. The salary for April 2012, based on the terms of the contract and the working time sheet, amounted to 100 thousand rubles. The cumulative total from the beginning of the year is 400 thousand rubles. and did not exceed 512 thousand rubles. (the base for calculating insurance premiums is for each individual an amount not exceeding 512,000 rubles on an accrual basis from January 1, 2012). Contributions to the Pension Fund - 22%; in the Federal Social Insurance Fund of the Russian Federation - 2.9%; to the Federal Compulsory Medical Insurance Fund - 5.1%, a total of 30%. When calculating personal income tax, a deduction for a child is not applied, since income for January-April exceeded 280 thousand rubles.
“Salaries of 100 thousand rubles have been accrued,
Pension Fund contributions of 22 thousand rubles were accrued. (100 *22%),
FSS contributions of 2.9 thousand rubles were accrued. (100*2.9%),
Compulsory medical insurance contributions of 5.1 thousand rubles were accrued. (100*5.1%),
personal income tax accrued 13 thousand rubles. (100*13%)".
Option II
Based on the same conditions, let us assume that the founder has not signed an employment contract, but, based on his decision, performs the duties of the general director. Wages and salary deductions are calculated and paid based on the decision.
In this case, tax accounting will not recognize expenses for both wages and contributions to insurance funds.
In accounting, it is necessary to accrue a permanent tax liability of 26 thousand rubles. (130*20%) .
Let us note that regulatory authorities have the right to question the legality of the employment contract between the sole founder-manager in one person. Until the legislator directly establishes the procedure for the sole founder to perform managerial duties, there will be risks of disputes with tax authorities and the likelihood of reclassification of payments to this individual even in the presence of an employment contract.
Liliya Mikhailovna Kuleshova,
Lead Auditor “What to do Audit”
The material presented in this article is provided for informational purposes only and may not be applicable to your particular situation and should not be taken as a guarantee of future results. For solutions to specific questions, we recommend contacting our company’s specialists.
We draw attention to the need to take into account changes in legislation that occurred after the date of preparation of the material.
The only founder and director in one person is a typical picture for a small business. Moreover, bringing a startup to profit often requires the manager to invest a year or even more of work and money into its development without receiving anything in return.
In such a situation, paying the director a salary is a luxury that not everyone can afford. The luxury of paying insurance premiums from your salary, maintaining personnel records and submitting a huge amount of “salary” reporting.
Meanwhile, in an already established business, you want something fundamentally different - social guarantees (sick leave, vacations), the formation of pension savings, a monthly salary. These are the benefits of an employment contract.
Is it necessary to conclude an employment contract and pay wages?, if your company has the only founder and director in one person? Unfortunately, there is no single official answer to this question. And if you came here for an exact “yes or no,” then I will immediately disappoint you.
Meanwhile, there are also advantages - using the situation in a way that is beneficial to you. And in both cases, guided by legal norms.
Employment contract with the sole founder
All official sources who are called upon to clarify controversial issues - Rostrud, the Ministry of Finance, extra-budgetary funds, the courts - like capricious young ladies, put forward opposing points of view. Moreover, with references to legislation. That does not prevent them from changing their position to the opposite one after some time.
By the way, letters from Rostrud and the Ministry of Finance are not normative legal acts; they contain only explanations and opinions and cannot have legal force.
Above, we have already briefly outlined the reasons why an employment contract with a single founder can be beneficial, we repeat:
- — the opportunity to receive monthly income from the business, regardless of whether there is profit;
- — social guarantees (payment of vacations and various benefits);
- — formation of pension insurance length of service for calculating pensions.
Examples of officials’ opinions against concluding an employment contract: letters of Rostrud dated 03/06/2013 No. 177-6-1, dated 12/28/2006 No. 2262-6-1, letter of the Ministry of Finance dated 02/19/2015 No. 03-11-06/2/7790, letter of the Ministry of Health and Social Development dated August 18, 2009 No. 22-2-3199. Here are their arguments:
- If the only founder and director are one person, then the employment contract will contain two identical signatures, he concludes with himself, which is impossible.
In paragraph 3 of Art. 182 of the Civil Code of the Russian Federation states that an agreement signed by the same person on both sides has no legal force. But the provisions of this article do not apply to labor relations; this is civil law.
- Article 273 of the Labor Code from Chapter 43 (labor relations with the manager) states that the provisions of this chapter do not apply to managers who are the only participants (founders) of their organizations.
As you can see, the statements are very controversial.
Is the director's employment contract with himself or with the company?
What arguments can you give in your favor if you are the only founder and director in one person and want to conclude an employment contract?
- The parties to the employment contract are different– director as an individual and organization as a legal entity. It is known that a legal entity has its own legal capacity and acts in legal relations on its own behalf, and not on behalf of its founders. Therefore, an employment contract between the director “with himself” is possible.
- Chapter 43 of the Labor Code, which officials refer to, describes the relationship with the manager, who is not the founder. The Labor Code itself does not prohibit concluding an employment contract with a single founder. And even in Article 11, among the persons to whom labor legislation does not apply, the founding director is not named.
Indirectly confirms the possibility of concluding an employment contract with the sole founder insurance legislation. So, for example, in paragraph 1 of Article 7 of Law No. 167-FZ of December 15, 2001 “On compulsory pension insurance in the Russian Federation” we will find that the insured persons are “those working under an employment contract, including heads of organizations who are the only participants (founders)".
Similar provisions are in laws No. 326-FZ of November 29, 2010 (health insurance) and No. 255-FZ of December 29, 2006 (social insurance).
Order for director - sole founder
Labor relations with the general director are formalized in accordance with all the rules of labor legislation, with the conclusion of an employment contract. If there is only one founder, then the agreement can be concluded for an indefinite period.
The text of the agreement states that of this employee“the duties of the general director are assigned on the basis of the decision of the founder (participant) No...... dated.....”.
Those. first you need to sign the decision of the sole participant of the company. The decision will say: “I assign the duties of the general director to myself.”
Based on the decision, an order is issued to the director - the sole founder, which says approximately the following: I, full name, begin to perform duties as the general director of LLC "..." from (date). Grounds: decision of the sole participant of the company No.... dated...
The requirement to issue an employment order is contained in Art. 68 Labor Code of the Russian Federation. The employment record is made by general rules, established by the Rules for maintaining and storing work books (approved by Decree of the Government of the Russian Federation of April 16, 2003 N 225), as well as the Instructions for filling out work books, approved. Resolution of the Ministry of Labor of the Russian Federation dated October 10, 2003 No. 69.
The signed order for the performance of duties will be an order for employment. Based on the concluded employment contract and order, an entry is made in the work book.
Entry into the work book is done as follows:
- — in column 3: Appointed to the position of General Director
- — in column 4: order details
If you plan to enter into an employment contract not only with the director, but also to hire other employees, then.
Salary of the director - the sole founder
The employment contract will provide for the payment of wages to the director. Its size must be economically justified (Article 273 of the Tax Code - expenses are economically justified and documented).
Please note that the salary of the director - the sole founder may be paid only upon concluding an employment contract. If he doesn't exist, then tax authorities they do not recognize it as an expense.
The explanation is simple - among the expenses that cannot be taken into account when calculating the tax base for profits, the Tax Code indicates any remuneration to managers, except under an employment contract (clause 21 of Article 270 of the Tax Code of the Russian Federation).
The director's salary is paid according to the same rules as other employees, there are no differences. Personal income tax is also withheld and insurance premiums are charged.
The only founder and director in one person without an employment contract
There is also the opposite situation, when the founder does not want to enter into an employment contract, but performs management functions. Since we have refuted the arguments of the Ministry of Finance and Rostrud, we will not refer to their conclusions and justifications. Let's go from the other side - from the position of civil legislation.
Article 53 of the Civil Code, art. 32, 33, 40 of the Law “On LLC” indicate that the director is the sole executive body of the company and carries out the current management of the LLC’s activities.
There is no connection here with the presence or absence of an employment contract and payment of wages. From the moment the sole founder, by his decision, assumes the functions of the sole executive body, he receives management powers.
Thus, the only founder who wants to manage his organization himself has the right to either conclude an employment contract or do without it.
SZV-M for founding director
All employers are required to submit a report to the Pension Fund of Russia in the form SZV-M. This must be done no later than the 15th day of the month following the reporting month. Until March 2018, according to the official position of the Pension Fund, SZV-M, there was no need to apply for a founding director with whom an employment contract was not concluded and who does not receive a salary. This was explained by the fact that such persons were not recognized as employees, and therefore as insured persons.
However, the Pension Fund of Russia has changed its position since March 2018. Now SZV-M for the founding director is submitted in any case, regardless:
- — the presence or absence of an employment contract concluded with him;
- - the presence or absence of wage payments to him;
- — management by the organization economic activity or stopping it.
A SZV-STAZH report is also submitted to the founder.
Officials explain their demand by the fact that Article 16 of the Labor Code states that even without a concluded employment contract, in this case, an employment relationship arises with the employee due to his actual admission to employment.
On this topic you can read: letters of the Pension Fund of the Russian Federation No. LCH-08-24/5721 dated 03.29.18, 17-4/10/B-1846 dated 03.16.18.
Moreover, regional branches for reinsurance require inclusion in SZV-M not only of the founder in the singular, but also of all founders, if there are several of them.
Is the founding director included in the DAM?
In the Calculation of Insurance Premiums (RAV) form, section 3 includes personalized information on the amount of wages accrued to each employee.
Therefore, if an employment contract is concluded with the founding director and he is paid a salary, then clearly such an individual and payments to him must be reflected in section 3.
However, according to the latest position of officials (letter of the Ministry of Finance dated 06/18/18 No. 03-15-05/41578, letter of the Federal Tax Service No. GD-4-11/6190@ dated 04/02/2018) Section 3 of the DAM should also include information about the director - the sole founder, even if an employment contract has not been concluded with him and he does not receive wages. In this case, subsection 3.2 will have zero indicators.
Officials explain this by saying that despite the lack of payments, such a person does not cease to be insured. And it is insured because there is still an employment relationship, even without an employment contract.
In this article, we deliberately examined not only the problem of concluding or not concluding an employment contract, but also reporting. Because in the same situation the same organs say completely different things. Fantastic! There cannot be an employment contract in principle, but at the same time there is one. As well as the obligation to submit reports.
No matter how you do it, you will still be wrong! Therefore, there is only one conclusion - do what suits you best - by concluding or not concluding an employment contract. But in the reports the only founder and director must be one person.
If you don’t have time to spend time on accounting routine, if you have more important tasks in your business, then write on the page or in the online chat, we will be happy to help you. In the comments you can ask questions about the content of the article if you have any.
