How can a FPO take advantage of the tax benefits and incentives that...?

During martial law, individual entrepreneurs (PPOs) are granted benefits regarding the payment of the single social contribution (SSC) and the single tax.

FOPs that are in the general taxation system, as well as those that pay a single tax, during the period of martial law in the country, as well as within 12 months after its end or cancellation, are exempted from the obligation to pay EUV "for themselves".

The fact of non-payment must be reflected in the report (Appendix 1 to the declaration), by setting zeros next to the months for which payment will not be made.

However, it should be remembered that in the event of non-payment of the ESSV, the insurance experience will not be counted.

In accordance with the legislation, with regard to the single tax, it is established that from April 1 until the termination or cancellation of martial law, entrepreneurs belonging to the 1st and 2nd taxation groups may be exempted from paying it.

Entrepreneurs who decide not to pay the single tax must reflect this fact in their annual declaration. At the same time, payment of the single tax for January, February and March is mandatory and must be reflected when filling out the reporting.

Taxation and reporting for sole proprietors with the third tax group in the 1st quarter of 2022 remain unchanged, which means the need to pay 5% of the income received.

Similarly to FOP from the first and second tax groups, entrepreneurs with the third group have the right to pay the calculated single tax after the end of martial law, and fines will not be applied.

Starting from the II quarter of 2022, sole proprietorships and legal entities can apply for transfer to the third group with special conditions of taxation at the rate of 2%. However, the "ordinary" third group, within which entrepreneurs pay 5% tax, remains.

Therefore, the simplified conditions of taxation with a rate of 2% will be applied only to those who have expressed their desire and submitted a corresponding application.

Reporting for entrepreneurs with the third group using the simplified taxation system will be submitted on a separate form. Unlike sole proprietorships, which pay 5%, entrepreneurs with a 2% rate must report and pay a single tax on a monthly basis, rather than quarterly. Special tax conditions will remain in force during the period of martial law.

The transition to 2% taxation is not mandatory and does not happen automatically. That is, enterprises that did not express a desire to make changes in their activities and did not submit an application for a tax reduction to 2%, will continue to be taxed according to the previous rules at a rate of 5% and will submit reports in the usual manner.

From July 1, deputies are working on innovations that concern individual entrepreneurs. According to draft law No. 8401, if it is adopted, the benefits related to the payment of a single tax for FOPs from the first and second tax groups, as well as the 2% rate for FOPs from the third group, will be canceled. In addition, entrepreneurs operating without cash registers/POS will have to pay fines.