A tax payment is paid on any income in Russia. The payer of tax on dividends is always the recipient of dividends. If a company acts as a payer, then it deducts tax, if an individual is an individual, then personal income tax. However, the organization that distributes dividends withholds from the payer and pays this type of taxes, since it is it, according to the Tax Code, that must act as a tax agent. How are tax deductions of this type calculated?
The tax agent receives this obligation if the company is on the simplified tax system (simplified tax system), unified agricultural tax (unified agricultural tax) or UTII (unified tax on imputed income).
Dividend Tax Scheme and Formula
Article 275, subparagraph 5 of the Tax Code provides an exact formula for how to calculate tax deductions to the Russian tax service from all types of dividends.
K * CH * (D1 – D2) = H
Further, the values of the constituent parts of the calculation:
K is the entire amount of dividends that the organization should distribute among the recipients, divided by the total amount of dividends distributed by this organization.
СH - the tax rate applied in the given period and to the given person.
D1 is all dividends (or total amount) before division and distribution.
D2 is the amount of dividends paid to the company in the current and previous reporting periods, but only if they were not previously taken into account in the calculation.
H - the actual "tax" amount, which must be further withheld and transferred to the tax authority from the income.
The formula loses its relevance if you calculate the tax on dividends in favor of foreign firms and foreigners. They, according to the same article, but paragraph 6, pay taxes taking into account the entire amount of dividends distributed by the tax agent. In a situation where funds are received by individuals. or a legal entity - a resident of Russia, then the ban on the use of the above formula is lifted.
Important features
In order to avoid mistakes, it is imperative to take into account the following nuances:
- The total amount of dividends that will be distributed (D1, as well as the denominator of the indicator K), necessarily also includes dividends to foreign firms and "physicists" who are officially non-residents of Russia. These are the explanations in the letters of the Ministry of Finance of the country dated July 8, 2014 N33030.
- The total amount always includes those from which the "profitable" tax is not withheld. Explanation: that is, we mean dividends accrued on shares in both state and municipal ownership, shares of mutual funds and public law organizations. Information about this is available in the explanatory note of the Ministry of Finance of our country dated June 11, 2014 N03-08-05 / 28295.
- For the past periods, dividends should be subject to the tax rate that is current on the day these dividends are accrued. This is the order in a letter from the Federal Tax Service for the city of Moscow dated March 14, 2007 N20-08 / 022130.
- When calculating D2, dividends (except for those at a percentage rate equal to 0) accrued both from Russian and from any other foreign enterprises should be summed up. They apply without the tax that was withheld from them by the source of payment. This clarification is in the decree of the same ministry of June 11, 2014 N03-08-05 / 28295.
- If, when calculating the amount, a negative result was obtained, then there is no need to pay tax to the agent. At the same time, no one compensates for the difference. This resolution is spelled out in as much detail as possible in Article 275 of the Tax Code (in subparagraph 5).
- The agent organization is obliged to notify the recipients of dividends electronically (you can do this on the website, in an email, etc.) or by physical letter within five working days from the date of determining the circle of recipients. The notification details the values of D1 and D2.
- For obligations, including dividend obligations, deadlines must be strictly observed. Dividend payments must be made no later than 2 months or 60 days from the date of the issuance of a decree in the company on their payment. If dividends have not been paid, in order to claim them, a person can apply with a claim to the company within 3 years.
Tax calculation rates
They directly depend on the recipient: is he a foreign or domestic company.
The former pay "dividend" tax at a strictly 15 percent rate. The recipient of the dividends, a Russian company, is calculated at a rate of 13 percent. But there is an important point here: a “dividend” payment of a company that, at the time of approval of the payment for more than one calendar year, owns more than 50 percent of the authorized capital of the organization (payer of dividends) or owns receipts of deposit giving the right to receive more than 50 percent of the total amount of dividends, carried out at a tax rate of 0%.
