What is needed to register an IP? Which IP is better to open for beginners?
Not all entrepreneurs, especially when it comes to small businesses and people who work for themselves, are ready to create a legal entity. The fact is that quite high requirements for accounting and tax reporting are imposed on a legal entity. Therefore, it is not surprising that many small and medium-sized entrepreneurs put off registering their business until the last minute.
In order to bring this category of entrepreneurs out of the shadows, the Russian government created a special form of entrepreneurial activity without creating a legal entity: individual entrepreneurship (IP). Let's take a closer look at who an individual entrepreneur is, what is needed to open an individual entrepreneur and how much this procedure costs.
Opening an individual entrepreneur yourself: step-by-step instructions and necessary documents
State registration of individual entrepreneurs. There are three options for submitting documents: in person to the registrar, by mail and through the website of the Federal Tax Service of Russia. An important innovation that encourages a future entrepreneur to use electronic registration is the absence of the need to obtain an electronic digital signature to register an individual entrepreneur. The identity of the applicant is established already at the stage of issuing a certificate of registration of individual entrepreneurs.Regardless of the chosen method of submitting documents, in order to register an individual entrepreneur, it is necessary to submit all the required documents to the department of the federal tax service at the applicant’s place of residence.
What documents are needed to open an individual entrepreneur?
- A copy of the internal passport of a citizen of the Russian Federation. A copy of all those pages that contain any information about the citizen is required.
- Original receipt of payment of the duty. The amount to be paid is 800 rubles. Payment details can be found on the official website of the Federal Tax Service of the Russian Federation.
- Statement of the established form (form No. P21001). Filling out this form is not that difficult, however, you should fill out all fields as carefully as possible and check the application for errors. Misprints, typos and corrections are not allowed, so it is better to fill out the application form in advance.
The above documents are mandatory for state registration. The absence of any of them is a reason for refusal of state registration. At the same time, refusal does not mean the absence of the right to apply to the federal tax service again, having collected all the necessary documents. The registrar's refusal can be appealed in court, however, it is more advisable to resubmit the documents.
An entrepreneur can also switch to a simplified tax payment system. This will allow him to administer fewer taxes (from 6 to 15% depending on the subtype of the simplified tax system) and thus simplify tax accounting. Having paid income tax in the amount of 6%, it is possible not to keep tax records on expenses at all. It is possible to change the taxation system at any time, however, a more reasonable option would be to initially select the most appropriate tax payment procedure, which is the simplified system.
Thanks to the “single window” principle implemented in Russia, registration of individual entrepreneurs in all kinds of government agencies is carried out automatically.
Opening a bank account. An entrepreneur has the right to independently choose the banking institution in which his current account will be opened. We recommend that you approach your choice of bank as seriously as possible, since possible problems with a bank account can completely paralyze the activities of an entrepreneur. Therefore, it is best to open an account in reliable state banks or banks with foreign capital. To open a bank account, you must submit a corresponding application to the banking institution.
Individual entrepreneur or LLC: which is better for small businesses?
To create your own business, you need to choose the organizational and legal form of doing business. The legislation provides for a huge number of different options for organizing a business, however, the real choice for small and medium-sized businesses still consists of two forms: a limited liability company (LLC) or individual entrepreneurship (IE).Why is an individual entrepreneur better than an LLC?
The undeniable advantage of individual entrepreneurship is the ease of creating a business. An individual entrepreneur does not create a separate legal entity with separate rights and obligations, but only expands his rights and obligations, extending them to the scope of entrepreneurial activity. The procedure for starting and, more importantly, terminating the entrepreneurial activity of an individual entrepreneur is much simpler than the creation and liquidation of a legal entity.
Another important advantage of individual entrepreneurship is the ability to maintain the most simplified accounting and tax reporting, which allows individual entrepreneurs not to spend small resources on tax administration.
In what ways is an individual entrepreneur inferior to an LLC?
However, it is necessary to take into account certain disadvantages of individual entrepreneurship. An individual entrepreneur, unlike the participants of an LLC, bears full property liability. Thus, if a debt has arisen as a result of entrepreneurial activity, the individual entrepreneur bears financial liability to creditors with personal property.
Another serious disadvantage of individual entrepreneurship is the difficulty of creating a joint business. This problem is partially solved by concluding a simple partnership agreement, however, it is almost impossible to achieve the degree of integration that is achieved by creating an LLC.
Summarizing all the advantages and disadvantages, it is better to open an individual entrepreneur as the simplest and most understandable form of doing business for small businesses. If over time the need arises to expand business activities, you can always liquidate the individual entrepreneur and create a legal entity.
Who can become an individual entrepreneur?
Any fully capable citizen of the Russian Federation can engage in individual entrepreneurship. However, an individual entrepreneur can be not only a citizen of the Russian Federation, but also a foreigner or stateless person. The only condition is that such a person has the status of a resident of the Russian Federation, which must be confirmed by relevant documents.
It is important to note that current legislation does not imply any restrictions on opening an individual business if a person is officially employed.
However, government employees, as well as people holding some elected positions, do not have the right to be an individual entrepreneur. Judges and municipal service employees are also prohibited from being individual entrepreneurs. If such persons are registered as individual entrepreneurs, there are grounds for dismissing them from work or terminating their representative mandate. State employees who are not government employees (doctors, teachers) have the right to become individual entrepreneurs.
Answering the question at what age can you open an individual entrepreneur, then, as a general rule, Individual entrepreneur registration is allowed from 18 years of age. However, there are three exceptions to this rule:
- If a minor has been given full civil capacity by a court decision.
- If the parents do not object to such activities of the minor. Parental consent must be notarized.
- If a minor has entered into marriage and acquired full legal capacity.
State financial assistance: is it really possible to get it?
In the first 2 years of its activity, an individual entrepreneur has the right to receive targeted financial assistance in the amount of up to 300 thousand rubles (in Moscow - up to 500 thousand rubles).
Such assistance has a specific purpose and can be spent on paying rent, equipping new jobs or purchasing fixed assets. At the same time, the possibility of receiving such assistance directly depends on whether the entrepreneur can attract his own or credit resources to organize a business. Only if you search for additional financing, as well as provide a high-quality business plan, is it possible to receive such assistance, which can be a good help for starting a business.
There is also the opportunity to receive a small subsidy (up to 50,000 rubles) from the employment fund. To do this, you need to officially become unemployed, skillfully refuse a job offered by the state (which is quite simple), and then create your own business. Since the state saves money on monthly payments to the unemployed, the employment fund pays a start-up entrepreneur up to 50,000 rubles as one-time financial assistance. At the same time, the procedure for obtaining such a subsidy is quite complicated, so not all individual entrepreneurs take advantage of this opportunity.
The state can also provide assistance to certain areas of business activity by establishing a preferential rental rate (as in the case of educational institutions) or a special taxation regime (agriculture).
How to open an individual entrepreneur, video instructions
As you can see, opening an individual entrepreneur, despite its apparent simplicity, is associated with a huge number of nuances, ignorance of which can lead to a number of problems.
However, simplification of all registration procedures allows you to open an individual entrepreneur yourself, without spending money on intermediaries. Opening an individual entrepreneur will cost 800 rubles (fees). Also don't forget that!
The intention to organize your own business, becoming an individual entrepreneur (IP), is often associated with great risks for citizens, especially for beginners. Therefore, it is very important to know how to register an individual entrepreneur correctly, what documents are needed, etc.
Registration of individual entrepreneurs is necessary in cases where there is some income generating activity. Any business must be legalized, the state must pay taxes on income.
But an individual entrepreneur will be reliably employed in his own enterprise, associated with the activity that he likes by choice, and even in the role of a manager.
The first stage of opening an enterprise, individual entrepreneur or LLC, is its registration. Otherwise, the activity will be prosecuted as illegal business, including on the basis of the Criminal Code of the Russian Federation. We have already written an article about that.
There are firms and legal agencies that provide assistance in registration and accounting services with timely submission of reports for individual entrepreneurs.
But you can do this yourself if you know how to open an individual entrepreneur and what documents you will need.
So, from this article you will learn:
- What is needed to open an individual entrepreneur in 2019;
- How to open an individual entrepreneur on your own and what to pay attention to - step-by-step instructions;
- Registration of individual entrepreneurs - necessary documents and actions;
- Tips and features of registering individual entrepreneurship.
Registration of an individual entrepreneur - simple step-by-step instructions for opening an individual entrepreneur
Any capable citizen can be an entrepreneur, organizer and participant of an individual entrepreneur. Such persons also include stateless people and all adults.
There are cases when reaching the age of 18 is not necessary to open an individual entrepreneur.
- Citizens under 18 years of age who are married.
- Granted for registration of individual entrepreneurs parental consent or guardians.
- A conclusion must be obtained full legal capacity, formalized.
At the same time, there are categories of citizens who cannot register an individual entrepreneur . This civil servants receiving salaries from the Russian budget and military personnel.
2. How to open an individual entrepreneur on your own (on your own)? 📃
If you do not turn to the services of companies that help you open an individual entrepreneur, you may encounter a number of obstacles. On the Internet there are services thanks to which you can obtain the forms necessary for registration, registration instructions, etc.
Professional specialists with appropriate qualifications can also register an individual enterprise quickly and without problems at an affordable price.
But if you have the time and desire to create and organize a business, then registration will not take much effort from you. It is enough to understand the essence of the process and follow the step-by-step instructions.
3. What documents are needed to register an individual entrepreneur - a list of necessary documents and actions 📋
A complete package of documentation requires a list of the following valuable, officially issued securities.
- Application for opening an individual enterprise according to the form P21001. A sample of this form can be downloaded from the link below or found on the Internet. ( - sample)
- A receipt indicating payment of the state fee. In 2019 the duty will be approximately 1000 rubles (from 800 rubles). There is no state fee when submitting documents electronically.
- Passport as an identity document.
- Provide your individual tax payer number (TIN).
An individual entrepreneur receives an individual taxpayer number from the tax office at the place of registration or residence
4. How to open an individual enterprise (individual enterprise) - step-by-step instructions 📝
So, step-by-step instructions on how to register an individual entrepreneur correctly and quickly.
Step 1. Pay the state fee in the required amount, receive an activity code and select a tax payment system
To pay the fee, you must fill out a form with the details, and make the payment at Sberbank, any branch, or through a specially designed terminal. The original receipt form must be retained. When submitting documents electronically, state duty absent .
OKVED codes must also be determined, namely: the entrepreneur selects from a list the type or type of occupation, each type is assigned a code consisting of at least four characters. This list of activities is limited by safety principles in accordance with the legislation of the Russian Federation. You need to choose from the list for 2017-2018.
OKVED codes when opening an individual entrepreneur
Businessmen get acquainted with this classifier, defining their activities by area, then by group. The number of selected species is not limited, but cannot be less than one.
Some species require a license. Then you will need to contact the licensing authority, which will also indicate the OKVED code for this activity.
Selection and determination of a taxation system that is more suitable for your case.
Which form of taxation should I choose?
Exists 5 (five) types of taxation, each of which corresponds to a regime.
1). General ( OSN) the type is assigned by default if no mode selection is made. If an entrepreneur (businessman) may consider such a regime unprofitable or undesirable, he should early When registering as an individual entrepreneur, attach an application indicating the chosen type of taxation.
The application is written in the form: “On the transition to another taxation system”.
The concept of OSN includes taxes:
- 20% on profit or 13% personal income tax;
- 18 percent(VAT) from sales made and services provided;
- Property tax;
If a businessman fails to pay taxes, his company will be at risk of bankruptcy as debts will accumulate.
2). UTII, that is - single tax on imputed income, assumes a specific amount of tax levied, in the so-called fixed form. UTII is not related to the profit of the enterprise. It is calculated based on business parameters, such as the number of employees hired, the area of retail premises, and the number of transport units.
But if the IP includes more than 100 (one hundred) Human, this tax cannot be selected.
Additional opportunity provided to an enterprise during taxation UTII: to 50 % reduction of insurance premiums for those registered in individual entrepreneurs and 100 % their reduction on the owner of the enterprise.
Similar cases are being considered arbitration courts and as soon as such a decision appears, registration of the enterprise canceled . The same procedure applies to non-payment of taxes and insurance premiums.
For more details and details, read the article.
In fact, bankruptcy occurs through 3 (three) months after the day on which it was required to pay for obligations in case of non-payment.
Second condition of bankruptcy — the amount of debt exceeded the size of the entrepreneur’s property in monetary terms.
To declare a businessman bankrupt, an application must be filed.
We described which ones you need to go through in a separate issue.
Who files an application for bankruptcy of an individual entrepreneur?
- An entrepreneur himself.
- Lender.
- Relevant authorized bodies.
We wrote in a special article about how to submit and fill out an application.
In the first case, the court may postpone the hearing for month, during which the entrepreneur is given the opportunity to pay off his debt to creditors. When repaying the individual entrepreneur's debt, a settlement agreement can be drawn up.
10. Lending to an individual enterprise 💳
Currently, it is quite possible to receive assistance for an individual enterprise from a bank in the form of a loan. We offer loans for business development, loans by type "express" and other varieties.
Again, not for the first time, the entrepreneur is required to collect documents to obtain a loan and fulfill the following conditions.
- Firstly, the enterprise must be registered.
- The next requirement is age from 23 years to 58.
- It is necessary to have guarantors and property that the entrepreneur can provide as collateral.
- The enterprise must exist for a year before applying to the bank.
But due to the fact that each bank has its own requirements, especially in the form of interest rates, entrepreneurs are forced to collect documents for several banks and submit them to them almost simultaneously.
The bank reviews applications from a couple of days to several weeks. The result is not known in advance. It is not so easy to find a guarantor who has property for collateral. And if the bank offers a very small amount corresponding to the collateral, then the entrepreneur may lose interest in the loan altogether, since there will be no point in it.
Special attention you need to pay attention to the interest rate offered by the bank. If the interest payment ends up being prohibitive or unaffordable, a risk assessment must be made in advance.
It is often easier to register with a bank, using the money immediately for the needs of the enterprise or for its expansion.
An individual entrepreneur is required to strive to cooperate with institutions that provide loans. To delve a little more into the proposed conditions and discard the most stringent ones does not mean completely abandoning the loan and stopping the development of the enterprise. You should try to make a decision that is satisfactory for both parties.
11. Conclusion + video on the topic 🎥
The article examined the concept of an individual entrepreneur who is engaged in legal activities: economic, scientific, trade or another in order to receive income from it, having previously registered the business as an individual entrepreneur. Based on the results of registering a business as an individual entrepreneur, he is assigned responsibility and obligations.
An individual entrepreneur can take and use his property in the enterprise. After paying all taxes, the individual entrepreneur disposes of the profit.
An individual entrepreneur may cease its activities or this may be done by the court that made the corresponding decision on bankruptcy, about breaking laws .
The main issue was the rules for registering an enterprise in order to legitimize its activities. It should be added that at the same time the businessman will be registered in: Russian Pension Fund and in Social Insurance Fund. This will be done automatically, without any action on his part, and a notification will be sent by mail.
The features of registering individual entrepreneurs in 2019 and the necessary documents and actions that will need to be carried out in order to register their business activities were also discussed.
The most important issue is choosing a tax payment system. In conclusion, we can say: opening your own enterprise, like an individual entrepreneur, requires great independence in decision-making.
It also requires a responsible attitude towards the consequences of mistakes, which would be best avoided using the above recommendations.
The period for registering an individual entrepreneur is not that long, usually opening an individual entrepreneur does not exceed a month. The steps outlined should help to clearly prepare for all situations that can no longer be called unforeseen.
After registering an individual entrepreneur with the tax office, you receive not only the right to conduct business, i.e. engage in entrepreneurial activity, but also have responsibilities, the first of which are to submit reports and pay insurance premiums for yourself. In addition to these key responsibilities of each individual entrepreneur, there are a number of nuances that you should know about so as not to run into fines in the first month of your official activity. Especially for this article, we have selected seven important issues that an IT freelancer needs to solve immediately after state registration.
And for those who have opened an LLC, we have prepared: 10 things that must be done after registering an LLC
1. Choose the right tax system
If, when you registered as an individual entrepreneur, you did not submit notifications about the transition to a simplified taxation system, then you will need to decide on the taxation system within the specified period of time after the date of registration.
The taxation system is the procedure for calculating and paying taxes. Each system has its own rate and tax base, but the main thing is that the amount of tax payable differs significantly. One such illustrative example is in the article “How much does a programmer earn in Moscow according to the Federal Tax Service.”
There are five taxation systems in total, but one of them (Unified Agricultural Tax) is intended only for agricultural producers. You can choose between the main one (OSNO) and special systems (USN, UTII, PSN). In principle, calculating the tax burden is an accounting topic, so if you know a competent specialist, then it makes sense to contact him.
- for OSNO you have to pay 13% of the difference between income and expenses plus VAT;
- under the simplified tax system, income tax will be 6% of income (in some regions the rate can reach 1%);
- under the simplified tax system Income minus expenses - from 5% to 15% of the difference between income and expenses (in some regions the rate can reach up to 1%);
- the cost of the patent is given by the Federal Tax Service calculator;
- calculating UTII is a little more complicated, but it can really be done on its own.
If you don’t want to delve into the calculations, but you can’t get to an accountant, we recommend that you apply for the simplified tax system Income, because This is the most common tax system. Plus, it is the simplest reporting system with a fairly low tax burden. It can also be combined with any other systems except OSNO.
Why is this important: special (aka preferential) tax regimes make it possible to reduce payments to the budget to a minimum. This right is enshrined in Article 21 of the Tax Code of the Russian Federation. But if you do not submit an application on your own to switch to the simplified tax system, UTII, PSN, then no one will persuade you. By default, you will have to work on a common system (OSNO). It is not advisable to forget about the reporting deadlines of your system; tax authorities will very quickly block the current account of an individual entrepreneur for failure to submit a declaration.
Another reason to submit tax reports on time is the risk of receiving a payment from the Pension Fund in the amount of 154,852 rubles. The logic is this: since you have not reported your income to the Federal Tax Service, then its size is simply immodest. This means that contributions will be calculated at the maximum (8 minimum wage * 26% * 12). This is not a fine, the money will go to your pension account and will be taken into account when calculating your pension (if everything has not changed again by then), but still the surprise is not the most pleasant.
2. Take advantage of tax holidays
If you register as an individual entrepreneur for the first time after the adoption of the regional law on tax holidays, you can qualify for a zero tax rate under the simplified tax system and the special tax regime. You can avoid paying taxes for a maximum of two years. Specific types of activities for which tax holidays are established are determined by regional law.
In Moscow, individual entrepreneurs-developers are not entitled to tax holidays, but if your activities are related to scientific research and development, then in most regions, including Moscow, you can receive a zero tax rate.
Tax holidays in detail, as well as the basis of most regional laws, can be found here.
Why is this important: If there is an opportunity to find yourself in a tax haven for some time, why not take advantage of it? In addition, on PSN, in principle, there is no way to reduce the cost of a patent by the amount of contributions. And during the tax holiday, an individual entrepreneur’s patent will not cost you anything.
3. Know and pay your own insurance premiums
Insurance premiums are payments that every entrepreneur is obliged to make for himself to the pension fund (PFR) and the compulsory health insurance fund (MHIF). Starting from the new year, the Federal Tax Service will collect contributions, because... According to the authorities, the funds themselves do a poor job of collecting payments in their favor.
The minimum contribution amount changes every year. In 2016, this is about 23 thousand rubles plus 1% on income over 300 thousand. If you have been registered as an individual entrepreneur for less than a year, the amount is recalculated accordingly. You must pay your own contributions the entire time you are registered as an entrepreneur. Justifications and arguments of the form:
- I don’t conduct any real activities;
- What kind of business is there, only losses;
- The employer pays my contributions according to my work book;
- I’m actually retired already, etc.
funds are not accepted for consideration.
You can avoid paying contributions for yourself if the individual entrepreneur has been drafted into the army or he is caring for a child under one and a half years old, a disabled child, a disabled person of the 1st group, or elderly people over 80 years old. But even in these cases, the accrual of contributions does not automatically stop; you must first provide documents that you are not engaged in real business.
So it’s not worth opening an individual entrepreneur just like that, with the expectation that it might come in handy someday. If you nevertheless registered as an individual entrepreneur, but are now in downtime, then it is cheaper to deregister (the state fee is only 160 rubles), and, if necessary, register again. The number of approaches to the reception desk is not limited.
Why is this important: contributions will still be collected from you, even if you close the individual entrepreneur. Plus, a fine of 20% to 40% of the unpaid amount and penalties will be charged. In addition, by not paying your contributions on time, you deprive yourself of the opportunity to immediately reduce the accrued tax by this amount.
An example of reducing payments under the simplified tax system for insurance premiums
An individual entrepreneur without employees using the simplified tax system earned 1 million rubles in income for 2016. He had no business expenses (but even if he had, no expenses are taken into account for the simplified tax system for income).
Tax amount 1,000,000 * 6% = 60,000 rubles. Individual entrepreneurs' insurance premiums for themselves amounted to 30,153.33 rubles, based on:
- contributions to the Pension Fund - (6,204 * 12 * 26%) + ((1,000,000 - 300,000) * 1%) = (19,356.48 + 7,000) = 26,356.48 rubles.
- contributions to the Compulsory Medical Insurance Fund - 3,796.85 rubles based on (6,204 * 12 * 5.1%) at any level of income.
The entrepreneur took advantage of the right to reduce advance payments for the single tax on the simplified tax system at the expense of paid insurance premiums, so he paid them quarterly (*).
Let's calculate the total amount that went to the budget in the form of tax: 60,000 - 30,153.33 rubles (the amount of insurance premiums paid by which the tax can be reduced) = 29,846.67 rubles. As a result, his entire tax burden, including insurance premiums, is equal to 60,000 rubles. The net income from the business of an individual entrepreneur is 1,000,000 - 60,000 = 940,000 rubles.
(*) If you pay contributions in a lump sum at the end of the year, you will first have to pay the full tax amount of 60,000 rubles, and then submit an application to the Federal Tax Service for a refund or offset of the overpaid tax. Therefore, it is better to pay contributions in installments every quarter and immediately reduce quarterly advance payments under the simplified tax system. The result will be the same, but in the first case there will be more trouble.
4. Submit notice of commencement of activity
Few people know this, but before you begin to provide repair services for computers and communications equipment (OKVED codes 95.11 and 95.12), an individual entrepreneur must submit a notification of the start of business activity to the local branch of Rospotrebnadzor.
This is done in order to include you in the Rospotrebnadzor inspection plan, although they promise not to check you for the first three years after registration of an individual entrepreneur. But if a client complains about you, dissatisfied with the quality of services, then the inspection will be unscheduled. By the way, from January 1, 2017, Rospotrebnadzor will come with an inspection only if the client provides evidence that he has already tried to hold you accountable. Apparently, the department is already tired of checking the reality of all consumer complaints.
Why is this important: If you do not submit a notification, you can receive a fine of 3 to 5 thousand rubles. The mere indication of OKVED codes 95.11 and 95.12 when registering an individual entrepreneur does not oblige you to report anything. You only need to submit a notice if you actually plan to start repairing computers and communications equipment.
5. Open a current account
You can work without a current account if your clients are individuals who pay in cash, and you enter into agreements with other individual entrepreneurs and LLCs for amounts not exceeding 100 thousand rubles. This is the limit that the Central Bank has set for cash payments between commercial entities.
It is quite easy to exceed it, because this is not a one-time payment, but the amount of settlements throughout the entire term of the contract. For example, you entered into a lease agreement for a year, the rent is 15 thousand rubles per month. The total amount of payments under the agreement will be 180 thousand rubles, which means that rent payment is allowed only by bank transfer.
Non-cash payments are, in principle, convenient, not only because they increase the number of payment methods, but also allow the consumer to pay you with a credit card when he has no other free money. Payments with electronic money can be legalized by creating a corporate wallet for individual entrepreneurs.
Why is this important: For violating the cash payment limit, an individual entrepreneur is subject to a fine under Article 15.1 of the Code of Administrative Offenses of the Russian Federation (from 4 to 5 thousand rubles). And we talked about why you shouldn’t accept payments to your personal card in the article 5 reasons not to use your personal account in freelancing.
6. Register as an insurer
If you use hired labor, you must register as an insurer in a timely manner. Moreover, the type of contract with the employee - labor or civil law - does not matter. Even if you enter into a one-time short-term contract for the performance of some services or work with an ordinary individual, you become the insured. That is, in addition to paying remuneration to the contractor, they are required to pay insurance premiums for him at their own expense, withhold and transfer personal income tax to the budget and submit reports.
The obligations of the policyholder to submit all kinds of reports on employees or performers are very depressing - there is really a lot of it, and it is complex. And since 2017, the main functions of administering contributions were transferred to the Federal Tax Service, nevertheless leaving some reporting for the Pension Fund and the Social Insurance Fund.
Why is this important: The deadline for registering individuals as insurers with the Pension Fund of the Russian Federation and the Social Insurance Fund is 30 days from the date of conclusion of the first employment or civil law contract. If you violate the deadline or do not register at all, the Pension Fund will fine you from 5 to 10 thousand, and social insurance - from 5 to 20 thousand rubles. Since 2017, the procedure for registering with the Social Insurance Fund remains the same, and instead of the Pension Fund of the Russian Federation, the application of an individual entrepreneur must be submitted to any tax authority.
7. Obtain a license if your type of activity is licensed
A license is permission to engage in a certain type of activity. In the IT sphere, Law No. 99-FZ dated May 4, 2011 classifies the following areas as licensed:
- Development, production, distribution of encryption tools, information systems and telecommunication systems, performance of work, provision of services, maintenance in this area, with the exception of the own needs of an organization or individual entrepreneur;
- Development, production, sale and acquisition for the purpose of sale of special technical means intended for secretly obtaining information;
- Activities to identify electronic devices intended for secretly obtaining information, with the exception of the own needs of the organization or individual entrepreneur;
- Development and production of security equipment, activities for the technical protection of confidential information.
Licenses are issued by the FSB; advice on licensing issues can be obtained.
Why is this important: for activities without a license or in violation of its terms, an administrative fine may be collected under Article 14.1 of the Code of Administrative Offenses of the Russian Federation (for individual entrepreneurs, the amount is from 3 to 5 thousand rubles); confiscation of manufactured products, production tools and raw materials is also allowed. If, as a result of such activity, large damage is caused or income is received on a large scale, then criminal liability is possible.
Criminal Code of the Russian Federation, Article 171. Illegal entrepreneurship
1. Carrying out business activities without registration or without a license in cases where such a license is required, if this act caused major damage to citizens, organizations or the state or is associated with the extraction of income on a large scale, is punishable by a fine in the amount of up to three hundred thousand rubles or in the amount of the wages or other income of the convicted person for a period of up to two years , or compulsory labor for a term of up to four hundred eighty hours, or arrest for a term of up to six months.
2. The same act:
a) committed by an organized group;
b) associated with the extraction of income on an especially large scale, -
is punishable by a fine in the amount from one hundred thousand to five hundred thousand rubles or in the amount of wages or other income of the convicted person for a period of one to three years, or forced labor for a term of up to five years, or imprisonment for a term of up to five years with a fine in the amount of up to eighty thousand rubles or in the amount of wages or other income of the convicted person for a period of up to six months, or without it.
Finally, a brief overview of what not to do with IP:
- An individual entrepreneur cannot be sold entirely as a business. An entrepreneur can sell property, remaining goods, raw materials, supplies, etc. The buyer, if he intends to continue to conduct business, must be registered as an individual entrepreneur or LLC. Documents containing the name of the entrepreneur-seller (licenses, permits, approvals, contracts, etc.) will have to be re-registered to the new owner, and this is not always easy.
- IP cannot be renamed. Changes in the name of the individual entrepreneur are allowed only if the passport details of the individual have changed. For example, when changing your surname during marriage. But you can’t just call yourself by a different name or come up with a sonorous nickname/name. You can register a trademark or service mark that can be used in advertising, but in official documents the individual entrepreneur will still appear under the full name of the individual.
- You cannot register two or more individual entrepreneurs at the same time. Registration of an entrepreneur is carried out using his individual tax identification number, which does not change throughout his life, regardless of the change of name. If you are an existing entrepreneur, the tax authorities will immediately see this, so they will refuse to open a new individual entrepreneur. If you want to have several unrelated businesses, register companies, you just need to stop at the number 10, after which the founder is recognized as a mass one.
- IP cannot be transferred or leased. This is equivalent to renting a passport or work book. There are such offers on the Internet, and they try to convince that everything here is within the law: they will show copies or originals of the individual entrepreneur’s registration certificate, issue a power of attorney and even sign an agreement on joint activities. But such an agreement has the right to be concluded by commercial entities, not individuals, so it has no legal force. Everything you earn will belong to the “lessor”; you can only try to prove something through the court.
If you are not an individual entrepreneur yet, but are actively thinking about it, read our complete instructions for registering an individual entrepreneur with all life hacks. We are also ready to advise you free of charge on your choice
Hello! In this article we will talk about what to do after registering an individual entrepreneur.
Today you will learn:
- What should an entrepreneur do before starting work and what is the deadline;
- What common mistakes can be avoided?
Individual entrepreneur registration
State registration of a citizen as an individual entrepreneur is carried out by the Federal Tax Service on the basis of an application. You can submit a basic package of documents to the tax office in person, by registered mail, or through special online resources.
The following documents are required for registration:
- Photocopy of passport (all pages);
- Copy ;
- Confirmation of payment of state duty (receipt).
A citizen receives a registration certificate (OGRNIP) and an extract from the Unified State Register of Individual Entrepreneurs within five working days, after which he officially becomes an individual entrepreneur. But this does not mean at all that at this stage you can relax and immerse yourself in new activities.
Read on to find out what to do after registering with the tax office in our step-by-step instructions.
What to do next after registering an individual entrepreneur
Having registered as an individual entrepreneur, a citizen receives a certificate, an extract from the register and no further instructions. It is not surprising that many beginning businessmen are lost and do not know what to do. Let's look at the main points that should not be forgotten.
Step 1. Selecting a tax system
After registration, an individual entrepreneur automatically enters the main tax payment system (). But, as in most “default” situations, this is far from the easiest and most profitable option for a beginner.
To switch to the special regime, certain deadlines have been established for submitting an application to the Federal Tax Service:
- simplified tax system – 30 days after registration of individual entrepreneur;
- – within 5 days from the start of the regimen;
- – no later than 10 days from the start of use.
In total, the following systems are available to an individual entrepreneur:
| BASIC | simplified tax system | UTII | Patent |
| Impressive and complex paperwork | Simplified document flow | The mode is only possible for some types of activities | Can be used for any period of time |
| It is mandatory to keep a ledger of income and expenses. | Maintaining KUDiR to confirm income (or income and expenses) | Allowed to combine with other modes | It is necessary to maintain KUDiR |
| Minimum tax required | The tax amount does not depend on income and expenses | Tax at a fixed rate on the amount of income |
Transition to simplified tax system
To switch to the simplified tax system, an individual entrepreneur must submit an application to the tax service within thirty working days. Late entrepreneurs will remain on OSNO and will be able to switch to the simplified tax system only from the first quarter of the next calendar year.
Before choosing a “simplified” version, an individual entrepreneur should be aware of the existing restrictions in its use. Of course, when a business is just starting out, this is hardly relevant, but in the future it may come in handy. So, what are the conditions for applying the simplified tax system:
- The staff has less than one hundred employees;
- The annual income of the enterprise is less than 150 million rubles;
- The individual entrepreneur is not engaged in mining, does not produce goods subject to excise taxes;
- The individual entrepreneur does not conduct legal or notary practice.
Step 2. Registration with the Pension Fund and Social Insurance Fund
Since since 2017, insurance premiums have been administered by the tax office, there is no longer any need to register additionally with the Pension Fund. The Federal Tax Service will unilaterally transfer the necessary information from the entrepreneur to the Pension Fund and the Social Insurance Fund.
But if an individual entrepreneur plans to hire workers, then, without fail, you will need to register with the Social Insurance Fund as an employer in order to pay contributions for industrial accidents and occupational diseases.
This must be done within ten days from the moment the individual entrepreneur entered into an employment contract with the employee.
To register as an employer you must provide:
- Application for registration;
- IP passport;
- OGRNIP;
- Extract from the Unified State Register of Individual Entrepreneurs;
- Personnel documents confirming the hiring of the first employee (a copy of the hiring order, as well as a copy).
The registration process with the Social Insurance Fund takes about five days; based on its results, the entrepreneur is assigned a registration number.
Step 3. Visit the statistics service
Based on the state registration certificate, the individual entrepreneur receives a letter from the statistics department containing codes and data that will definitely be useful to the entrepreneur in his future activities. For example, when opening a bank account.
Step 4. Making a seal
, but it increases the status of the entrepreneur in the eyes of counterparties, and in addition it is necessary:
- On strict reporting forms, sales receipts (especially important for trading without cash register);
- To open a current account in some banks;
- To certify transport invoices;
- When filling out work books.
You can order a stamp from a specialized company by providing your passport, INN, and OGRNIP. It is not necessary to register the seal, but if desired, this can be done at the tax office.
An individual entrepreneur can have an unlimited number of seals (separately for banking, personnel, other internal documents, strict reporting forms), but the principle “the more, the better” is not applicable to this situation. In practice, the fewer stamps, the easier it is to work with them.
Step 5. Obtaining licenses, notifying regulatory authorities
Some types of activities in Russia are subject to mandatory licensing. The full list can be found in Article 12 99-FZ. The licensing authority depends on the direction of business, so if a pharmacist has to go to Roszdravnadzor, then a firefighter has to go to the Ministry of Emergency Situations.
Most often, individual entrepreneurs have to. Many entrepreneurs planning to work in the service, catering and other sectors are required to go through this procedure.
You can submit an application to Rospotrebnazdor (required in two copies) in one of the following ways:
- To the regional authority in person or through a proxy;
- By registered mail with an inventory;
- Through the Rospotrebnadzor website or the State Services portal.
Step 6. Registering a cash register, opening a current account
If, since 2017, only entrepreneurs on the simplified tax system, OSNO, and the Russian Federation are required to have a cash register, then from July 2019, almost all individual entrepreneurs will use it, with rare exceptions.
An individual entrepreneur is not required to open a current account, but with its help additional opportunities open up:
- Receive non-cash payments and transfers (both from clients and counterparties);
- Make quick transfers to government funds, pay taxes, services and goods from regular suppliers;
- Pay for goods and services under agreements with other legal entities.
It is very important to take a responsible approach to choosing a bank. It must be proven (it’s worth looking for reviews) and reliable. Service rates that are too cheap should put you on guard, while rates that are too expensive should put you off. The range of services provided is also important: online account, lending, speed of transfers.
The list of documents required for the application depends on the specific bank, but the basis, as a rule, does not differ much from the standard:
- Statement;
- Passport;
- OGRNIP;
- Certificate from Rosstat;
- Extract from the Unified State Register of Individual Entrepreneurs;
- Sample signatures and seals (filled out at the bank itself).
There is no requirement to notify the Federal Tax Service about opening a current account in 2019.
Step 7. Organize document flow
It is better to sort any documents and store them carefully. Firstly, an audit may catch an individual entrepreneur even three years after closure. Secondly, with an established document flow, any work goes faster and more clearly.
For example, individual entrepreneur documents can be divided into the following folders:
- State certificates, certificates and licenses;
- Bank documents;
- Agreements with regular suppliers (and clients);
- Personnel documents;
- Cash documents, strict reporting forms (especially important in trade).
Common Mistakes
Anyone can make a mistake. To minimize risks, you need to remember the common mistakes made by beginning entrepreneurs.
These include:
- Missing the deadline for submitting an application for transition to. No more than thirty days are given to submit an application. To be late means to work for a long time (sometimes almost a year) under an unfavorable and complex general tax regime.
- Violation of deadlines for registration in state funds. Result: administrative liability and fines.
- Ignoring the statistics department. Fines for violations of reporting to statistics are growing every year. Not as much is known about it as about the PF or FSS, but in terms of severity the statistics are not inferior to them.
- Unorganized document flow at the enterprise. Don't expect everything to work out on its own. Papers will not fold themselves into the archives, and document forms will not appear out of nowhere.
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