Covering the losses of previous years at the expense of part of the profit, the company can apply benefits for income tax, which is provided for in paragraph 5 of article 6 of the Law of the Russian Federation No. 2116-1 of December 27, 1991 "On the tax on profit of organizations and enterprises." This operation can be carried out only if the losses were repaid also at the expense of the enterprise's reserve fund, created in accordance with the legislation of the Russian Federation.
Instructions
Step 1
Use a reserve fund to cover past losses. Create a reserve fund in accordance with clause 1 of article 35 of the Federal Law No. 208-Fz dated 26.12.1995 “On Joint Stock Companies”. Its value is formed annually at the expense of deductions from the profit of the enterprise, which remained after taxes. The amount of deductions to the reserve fund is established by the charter of the organization, but not less than 5% of the amount of net profit. For enterprises that are not LLCs, the creation of a reserve fund is not a mandatory procedure, therefore, it is necessary to be guided by Article 30 of the Federal Law of the Russian Federation No. 14-FZ of 08.02.1998 "On Limited Liability Companies". To reflect this transaction in accounting, it is necessary to open subaccount 84.4 "Uncovered loss of previous years". After that, a loan is formed on it with reference to the debit of account 82 "Reserve capital".
Step 2
Cover past losses with additional capital. Additional capital can be formed using the amounts of share premium, revaluation of non-current assets and part of retained earnings, which the organization is directed to capital investments. Thus, the coverage of losses of previous years is due to the formation of a loan on account 84.4 and a debit on account 83 "Additional capital". Also, the authorized capital can be reduced to the amount of net assets, and the difference can be used to pay off losses by opening a debit on account 80 "Authorized capital" with correspondence with account 84.4.
Step 3
Pay off past losses with targeted contributions from founders. The legislation does not classify these funds as taxable income if they are used to cover losses. To reflect this operation, a credit is opened on account 84.4 and a debit on account 75 "Settlements with founders".
Step 4
Use the profit of the current reporting year to cover losses from previous years. In this case, there is a rule that only no more than 30% of retained earnings can be written off. Thus, if this amount is enough to cover losses, then a credit is opened on account 84.4 and a debit on account 84.1 "Received profit".
