Insurance from bonus

Associate Vladimir Starovoytov of the Law Firm "YUST"

Insurance payments should be imposed on any stimulating payments (bonuses for anniversaries and holidays), even if those are not stipulated in the employment agreement. Such is the decision adopted by the Higher Court of Arbitration of Russia.

The essence of the dispute

A regional department of the Pension Fund of Russia believed that a local company had understated the base for insurance payment calculation by not including the bonuses paid to the employees for certain dates (birthdays, public and professional holidays) for over 1,5 million roubles. The organization underwent documentary check, was brought to liability in the form of a fine and a penalty and was obliged to pay the respective amount to the budget.

The position of the Board of the HCA of Russia

Pursuant to Article 5 of the Federal Law No. 212-FZ dated July 24 of 2009 (hereinafter – the Law No. 212-FZ), organizations, individual entrepreneurs, individuals not recognized as individual entrepreneurs, who pay monetary funds to individuals, are payers of insurance contributions. The objects, on which insurance contributions are imposed, include, inter alia, payments and other remunerations paid by the insurance contributions’ payers to individuals within the framework of employment relations. The law specially stipulates exemptions: on what objects specifically no contributions are imposed (for example, payments under civil law agreements on transfer of property titles or other real rights to property). The base for imposing insurance contributions is determined as the sum of payments and other remunerations, which are the object of imposition, paid by the insurance contributions’ payers to individuals during the reporting period – one calendar year.

Article 9 of the Law No. 212-FZ also specifies all amounts, which are not included in the base, and the list fixed by said normative act cannot be expanded. For example, insurance contributions are not imposed on payments related to the dismissal of employees, one-time financial assistance given by the employer, financial assistance not exceeding 4000 roubles per employee per calendar year.

Salary is remuneration for work depending on the employee’s qualification, complexity, amount, quality and conditions of the work done and compensation payments (additional payments and increments of compensational nature, including for work in the conditions different from the normal ones, for work in special climate and in the territory affected by radioactive pollution, other compensations) and stimulating payments (additional payments and increments of stimulation nature, bonuses and other rewards). The size of the salary is fixed by the employment contract according to the employment pay systems used by the employer (Articles 129, 135 of the LCRF).

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Continued in the printed version of the “Banking Survey” magazine, July of 2013.