Responsibility of the company director for tax offenses

Administrative responsibility of the director of the organization for tax offenses

Fines established by the Tax Code of the Russian Federation for non-payment of taxes and failure to fulfill other tax obligations are imposed on the organization as a taxpayer. An official of an organization holding the position of its director cannot be fined under the Tax Code of the Russian Federation, since he is not a taxpayer, but acts as an employee.

For tax violations committed, the director of the organization bears administrative responsibility in accordance with the norms of the Code of Administrative Offenses of the Russian Federation. At the same time, bringing an organization to justice for committing a tax offense does not relieve its director from administrative liability provided for by the laws of the Russian Federation (clause 4 of Article 108 of the Tax Code of the Russian Federation).

This means that both the organization and its manager can be fined at the same time for the same tax violation. For example, if a company is late in filing tax reports, it will be held liable for taxation under Art. 119 of the Tax Code of the Russian Federation, and its directors - under Art. 15.5 Code of Administrative Offenses of the Russian Federation.

Currently, heads of taxpayer organizations can be fined for a number of administrative offenses in the field of taxation. Chapter 15 of the Code of Administrative Offenses of the Russian Federation “Administrative offenses in the field of finance, taxes and fees...” is dedicated to them separately. For greater clarity, let us present the existing fines for company directors for tax offenses in the form of a table.

Administrative liability of legal entities and entrepreneurs

General grounds for administrative liability of legal entities and entrepreneurs

The Russian Federation is far from the first state where the institution of administrative liability of legal entities and entrepreneurs is widely used (in those countries where the status of legal entities and persons engaged in business personally is divided). There is not a single state in Europe in which the importance and effectiveness of this institution is not confirmed in everyday law enforcement practice. It is therefore natural that the Code of Administrative Offenses of the Russian Federation pays increased attention to it, recognizing legal entities and entrepreneurs as subjects of a significant number of administrative offenses related to non-compliance with established rules in the field of industry and energy, communications and information, business activity, antimonopoly legislation, finance, taxes and fees , securities market, customs, transport, ecology and many others.

The legal status of a legal entity in administrative-tort relations has significant features, the presence of which led to the allocation in the Administrative Code of the Russian Federation of a number of special rules characterizing the specifics of the administrative responsibility of this group of entities. Let us point out some features of this specificity.

1.

The concept of a legal entity as a subject of an administrative offense is based on the civil law definition of this legal category, formulated in the Civil Code of the Russian Federation (Articles 48 and 51 of the Civil Code of the Russian Federation). A mandatory feature of a legal entity in such relations is that it has civil legal personality. Two important conclusions follow from this.

Firstly, not every organization with civil legal personality can be subject to administrative liability. In particular, public associations that are not registered as a legal entity (for example, religious groups), international organizations, their branches and representative offices operating on the territory of the Russian Federation, as well as branches and representative offices of Russian legal entities are not considered such.

Secondly, the administrative responsibility of legal entities extends not only to business entities, but also to subjects of public law that have the status of a legal entity.

We are talking about various public legal entities, the main purpose of which is not participation in civil circulation and not the implementation of entrepreneurial activities, but the solution of problems of a public nature either through various forms of public initiative, or through the implementation of the powers of public administration.

Two groups of such subjects can be distinguished:

•organizations that are mentioned as legal entities in the Civil Code of the Russian Federation;

•organizations that are not mentioned as legal entities in the Civil Code of the Russian Federation and acquire this status on the basis of other regulatory legal acts.

The first group includes some public associations and institutions, including trade unions, political parties, state and municipal institutions: educational institutions of culture, healthcare, research institutes, state universities, etc.

The second group includes, in particular, federal executive authorities and their territorial bodies (with the exception of the Government of the Russian Federation, which, in accordance with the Federal Constitutional Law of December 17, 1997 No. 2-FKZ “On the Government of the Russian Federation”, does not have the status of a legal entity ); other government bodies, for example, the Accounts Chamber, the Central Election Commission, as well as representative and executive bodies of the constituent entities of the Russian Federation, the same local government bodies (for more details, see: “Consideration in courts of general jurisdiction of cases of administrative offenses” (Pankova O.V., under edited by O.A. Egorova, “Statute”, 2014)).

In addition, self-regulatory organizations that perform government functions in the provision of public services should be considered as legal entities of public law.

2.

Legal entities are subject to administrative liability only when this is provided for by the articles of the Special Part of the Code of Administrative Offenses of the Russian Federation or the laws of the constituent entities of the Russian Federation (Part 1 of Article 2.10 of the Code of Administrative Offenses of the Russian Federation). This universal rule of exceptions simply does not know.

3.

If the sanction of the article establishing administrative liability does not directly indicate that it applies only to an individual or only to a legal entity, these rules apply equally to both individuals and legal entities, unless, within the meaning of These norms apply and can be applied only to an individual (Part 2 of Article 2.10 of the Code of Administrative Offenses of the Russian Federation).

4.

Of the ten types of administrative penalties provided for in Art. 3.2 of the Code of Administrative Offenses of the Russian Federation, only four can be applied to legal entities: a warning, an administrative fine, confiscation of the instrument or subject of the administrative offense, administrative suspension of activities.

The most common of them are an administrative fine and confiscation of the instrument or subject of the administrative offense. Announcement of oral remarks in accordance with Art. 2.9 of the Code of Administrative Offenses of the Russian Federation does not apply to administrative penalties.

In this case, the amount of an administrative fine, calculated in hard ruble equivalent, as a general rule cannot exceed 1 million rubles. However, for certain types of violations such a fine is set at a much larger amount and can reach tens of millions of rubles. As we can see, the penalties introduced into the legislation on administrative offenses for legal entities are significant in size and can significantly influence their socio-economic situation. It is obvious that such punishment is objectively aimed at implementing not only a preventive, but also a punitive function, and in this capacity it is quite comparable to criminal fines.

5.

The imposition of an administrative penalty on a legal entity does not relieve a guilty individual from administrative liability for this offense, just as bringing an individual to administrative or criminal liability does not exempt a legal entity from administrative liability for this offense (Part 3 of Article 2.10 of the Code of Administrative Offenses of the Russian Federation), if that for certain types of administrative offenses, higher sanctions are provided for legal entities compared to sanctions for individuals.

According to the Constitutional Court of the Russian Federation, such legal regulation, being determined by the specifics of legal entities, which, as participants in economic turnover, bear the risks associated with the activities they carry out, as well as the fact that, unlike individuals, they are not recognized by the current legislation as subjects criminal liability is constitutionally permissible (Resolutions of the Constitutional Court of the Russian Federation dated April 27, 2001 No. 7-P and November 26, 2012 No. 28-P).

Many authors explain this rule by the principle of justice, according to which each person is responsible for an act in accordance with the degree of his guilt. However, most law enforcement officials and persons brought to administrative responsibility simply cannot wrap their head around it: why should both a legal entity and an individual be held accountable for the same offense? Why, in this case, did the legislator essentially introduce the principle of double liability for one offense (in administrative protocols, the elements of offenses for legal entities and for officials are often formulated as if “as a carbon copy”). This approach is especially painful for small business owners, for whom a legal entity is, essentially, themselves, their business, their life. The author of the publication is also critical of this practice. I believe that sooner or later we will expect fundamental clarifications and clarifications here, for example, on the issue that an official cannot be held accountable for the same offense; the elements of the offense for him must be formulated differently and be specifically provided for by the Code of Administrative Offenses of the Russian Federation.

Regulations of Part 3 of Art. 2.1 of the Code of Administrative Offenses of the Russian Federation is explained in paragraph 15 of the Resolution of the Plenum of the Supreme Court of the Russian Federation dated March 24, 2005 No. 5 “On some issues that arise for courts when applying the Code of the Russian Federation on Administrative Offenses” (hereinafter referred to as the Resolution of the Plenum of the Supreme Court of the Russian Federation dated March 24, 2005 No. 5), which talks about the need to establish the guilt of both an official and a legal entity in committing an administrative offense, for which they can be brought to administrative responsibility under the same article of the Special Part of the Code. Thus, additional attention is drawn to the fact that in this norm we are not talking about any individuals who have nothing to do with a legal entity, but about its officials.

By virtue of Part 3 of Art. 2.10 of the Code of Administrative Offenses of the Russian Federation, the possibility of simultaneously bringing a legal entity and its official to administrative liability for the same offense is not excluded in the case where the unlawful act was expressed in failure to comply with the requirements of an individual legal act addressed to both the legal entity and its official ( for example, instructions from regulatory authorities).

6.

Signs of guilt of a legal entity, enshrined in Part 2 of Art. 2.10 of the Code of Administrative Offenses of the Russian Federation, differ significantly from the signs of guilt of an individual.

The fact is that the subject category of a legal entity itself is very specific and represents a special legal construction that has neither a psyche, nor will, nor consciousness. Therefore, the traditional interpretation of guilt as a person’s mental attitude to the unlawful act he commits and its consequences is not suitable here. These characteristics formulated by the legislator must be taken into account when bringing legal entities to administrative liability.

7.

Individual entrepreneurs without the formation of a legal entity who have committed an administrative offense in connection with the implementation of entrepreneurial activities, when brought to administrative responsibility, are equated to officials (note to Article 2.4 of the Code of Administrative Offenses of the Russian Federation).

Strictly speaking, individual entrepreneurs are not officials; they only bear administrative responsibility as officials. Paying attention to the reservation made in the note to Art. 2.4 of the Code of Administrative Offenses of the Russian Federation, it should be noted that the provisions on administrative liability of officials apply to them only if federal law does not provide otherwise.

It is noteworthy that most of the articles of Chapter 14 of the Code of Administrative Offenses of the Russian Federation, dedicated to administrative offenses in the field of business activity, also provide for liability only for officials and legal entities. And only some of the more than 60 offenses in this area contain sanctions specifically for individual entrepreneurs (for example, Art. 14.1.2, 14.1.3, 14.25, 14.46.1). Moreover, the amount of the administrative fine applied to them significantly exceeds the amount of the fine for a similar offense committed by citizens who do not have the status of an individual entrepreneur.

It is also worth noting that in other chapters of the Special Part of the Code of Administrative Offenses of the Russian Federation, an individual entrepreneur is mentioned as an independent subject of administrative responsibility, distinct from an individual, official or legal entity (for example, Article 5.51, Part 3 of Article 6.25, Part 3 of Art. 6.29, Article 6.33, 7.23.3, Part 7 Article 7.32, Article 9.5.1, 11.15.1, 11.15.2, Part 10 Article 12.21.1, Part 5 Art. 13.15, for more details see: Some features of the legal status of an individual entrepreneur (Erokhina T.V., Kazarosyan Z.M., “Law and Economics”, 2021, No. 4)).

Minority of administrative offenses

According to Article 2.9 of the Code of Administrative Offenses of the Russian Federation, if the offense committed is of minor significance, a judge, body, or official authorized to resolve a case of an administrative offense may release the person who committed the administrative offense from administrative liability and limit himself to an oral remark.

A minor offense occurs in the absence of a significant threat to protected social relations. Circumstances such as the personality and property status of the person held accountable, voluntary elimination of the consequences of the offense, compensation for the damage caused, are not circumstances indicating the insignificance of the offense. These circumstances, by virtue of parts 2, 3 of Art. 4.1 of the Code of Administrative Offenses of the Russian Federation are taken into account when imposing an administrative penalty.

In accordance with paragraph three of paragraph 21 of the resolution of the Plenum of the Supreme Court of the Russian Federation dated March 24, 2005 No. 5, a minor administrative offense is an action or inaction, although formally containing signs of an administrative offense, but taking into account the nature of the offense committed and the role of the offender, the amount of harm and the severity of the consequences that have occurred, which does not represent a significant violation of protected public legal relations.

Let us note that in accordance with clause 8. (Review of judicial practice in cases of bringing to administrative liability, provided for in Article 19.29 of the Code of the Russian Federation on Administrative Offences" (approved by the Presidium of the Supreme Court of the Russian Federation on November 30, 2016) an administrative offense, the composition of which is provided for in the article 19.29 of the Code of Administrative Offenses of the Russian Federation (involvement by the employer or customer of work (services) in labor activities under the terms of an employment contract or in the performance of work or provision of services under the terms of a civil law contract of a state or municipal employee filling a position included in the list established by regulatory legal acts, or a former state or municipal employee who held such a position, in violation of the requirements stipulated by the Federal Law of December 25, 2008 No. 273-FZ “On Combating Corruption”), due to the special significance of public relations protected by law, which are the object of encroachment of this administrative offense, cannot be considered insignificant.

It is obvious that judicial practice will develop approaches to other elements of administrative offenses, where it will not be possible to apply insignificance.

Insignificance can be applied both by the body considering the issue of bringing to administrative liability and by the court (when it itself acts as such a body, and when the court considers the issue by appealing the decision of such a body).

If the administrative offense committed is of minor significance, the person who committed the administrative offense is not subject to administrative punishment.

Thus, the commission of a repeated administrative offense will not be a circumstance aggravating administrative liability in the case where, for the first administrative offense, the person brought to administrative responsibility was given an oral reprimand in accordance with Art. 2.9 Code of Administrative Offenses of the Russian Federation.

The personal practice of the author of the article shows that the use of insignificance by state bodies and courts occurs only when a request for this:

•follows cases where the very fact of an administrative offense is not denied, but the attention of the law enforcement agency is focused on its insignificance;

•motivated in detail with arguments and relevant evidence;

•illustrated by similar judicial practice, especially local;

•supported by references to the absence of harmful consequences and to the formal nature of the violation.

To be continued in the next issue

MIKHAIL SLEPTSOV, lawyer, managing partner of the law firm "SLEPTSOV AND PARTNERS", Candidate of Legal Sciences, Associate Professor, Honored Lawyer of the Russian Federation

Source of publication: information monthly “The Right Decision” issue No. 8 (178) release date of 08/21/2017.

The article was posted on the basis of an agreement dated October 20, 2016, concluded with the founder and publisher of the information monthly “Vernoe Reshenie” LLC “.

Administrative fines for the director

The most popular types of violations

Quite often you may encounter:

• working without a cash register;
• failure to comply with advertising laws;
• violation of cash handling;
• tax fraud;
• violation of accounting rules;
• false reporting;
• violations in the construction industry;
• non-compliance with labor laws;
• deceiving consumers.

But in some cases it turns out:

• slightly reduce the fine;
• obtain a review of the case;
• cancel the punishment altogether;
• challenge the court's decision.

The most common way to mitigate punishment is to shift all responsibility to the official. Payment of a fine by a legal entity will add a serious expense item to the company's budget - fines for legal entities and employees differ from each other by an order of magnitude. It will be possible to remove liability from a legal entity if the company proves that all measures were taken to ensure that the official did not have the opportunity to proceed with the law. Then penalties will apply only to the company employee.

Financial liability of the director for tax offenses

The director is obliged to act in the interests of the organization he heads in good faith and wisely (clause 3 of article 53 of the Civil Code of the Russian Federation). Otherwise, at the request of the organization or its founders, the director must compensate for losses caused by the violation.

In these cases, the director bears financial liability to the organization for losses caused by his guilty actions or inaction, unless other grounds and the amount of liability are established by federal laws (clause 2 of article 44 of the Federal Law of 02/08/1998 No. 14-FZ “On Companies with limited liability").

In a case for recovery of damages, the organization must prove the following circumstances in total:

• the director did not perform or improperly performed the duties assigned to him;
• the presence of a cause-and-effect relationship between the losses caused to the organization and the violation of obligations on the part of the director;
• the amount of losses incurred.

If the failure to pay tax and its subsequent additional accrual, along with penalties and fines, occurred precisely because of the director’s fault, this does not mean that the organization will be able to recover the tax arrears paid from him. The fact is that losses always mean expenses that a person has made or will have to make to restore a violated right, as well as lost income that this person would have received under normal conditions of civil circulation (Article 15 of the Civil Code of the Russian Federation).

In turn, the obligation to pay taxes and fees is always borne by the organization itself, and not by its management and other officials. The taxpayer's obligation to pay tax is associated with the appearance of an object of taxation, and not with certain actions of its management.

By paying amounts accrued due to late or incomplete taxes paid, the organization does not restore its violated right. She is merely fulfilling her legal duty. This obligation exists regardless of whether the payer's management violated tax laws or not.

Therefore, the tax arrears accrued to the organization are not losses and cannot be recovered from its director (decision of the Supreme Court of the Russian Federation dated October 29, 2019 No. 307-ES18-17204). Otherwise, a situation would arise in which the obligation to pay taxes would be shifted from the taxpayer to third parties (directors), which is unacceptable.

At the same time, legislation and arbitration courts allow the possibility of collecting tax sanctions from directors in the form of penalties and fines additionally assessed to taxpayer organizations.

Such penalties and fines, paid through the fault of taxpayers’ management, are precisely additional and unforeseen expenses that the taxpayer is forced to bear in connection with the illegal actions of its director. Accordingly, tax sanctions in certain situations, namely in case of unlawful guilty actions of the taxpayer’s management, can be considered as losses of the payer (letter of the Ministry of Finance dated August 22, 2014 No. 03-04-06/42105).

And if the illegal actions of the head of the organization to understate the tax base and improper payment of mandatory payments lead to the accrual of fines and penalties, then these tax sanctions can be collected from the director (resolution of the Arbitration Court of the East Siberian District dated March 1, 2016 No. A78-6413/2013) .

Accountant's responsibilities:

• Accountant's subsidiary liability: when it occurs and how to avoid it
• Responsibility of an accountant for errors and offenses made in the work