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Accounting services for micro-enterprises

A Microbusiness Tax payer is an individual merchant, fishing or agriculture, as well as an individual, which is registered in the Registry of Enterprises as a limited liability company with the right to pay microbusiness tax., In order to become Microbusiness Tax payer, company shall comply with certain criteria:

  • A turnover does not exceed 100,000 EUR per year
  • Number of employees – up to 5
  • A salary per employee does not exceed 720 EUR per month
  • Shareholders are only individuals and are deemed to be employees of the company

Employees of micro-enterprises are:

  • An owner of micro-enterprise
  • An individual with employment contract
  • Procurator

A micro-enterprise taxpayer shall inform the employees of the micro-enterprise thereof in writing. Micro-enterprise shall inform employees in writing that the personal income tax and mandatory State social insurance contributions of the employee of the micro-enterprise paying the micro-enterprise tax are determined from the turnover of the micro-enterprise and that the micro-enterprise employee has the right to join voluntarily the State social insurance, as well as a duty to submit the payroll tax booklet to the micro-enterprise.

Microbusiness tax rates

Microbusiness Tax is calculated at flat rate of 9% in first three years of the company. Starting from the fourth year the rate will be 12%. In case Microbusiness Tax payer fails to comply with requirements it loses is special status as from next year, and is subject to increased MBT rate in current year calculated as follows:

  • 2% points are added to standard rate for each additional employee in case Microbusiness Tax payer’s number of employees in a quarter exceeds 5
  • 20% rate is applied on the excess of turnover over 100,000 EUR
  • 20% rate is applied on the excess of employees salary over 720 EUR

The subject of microbusiness tax is company’s turnover.
Microbusiness tax rates includes:

  • Mandatory State Social Insurance Contributions (VSAOI)
  • Personal income tax
  • Corporate income tax
  • Business risk state fee

The Treasury shall divide the micro-enterprise tax revenue paid into the State budget by a micro-enterprise taxpayer as follows:

  • 0.1 per cent shall be transferred into the account for the State fee of the business risk
  • 65 per cent – into the account of the mandatory State social insurance contributions
  • 30 per cent – into the account of the personal income tax
  • 4.9 per cent – into the account of the enterprise income tax

Accounting

Micro-enterprises shall comply with the following regulations on accounting, which define specific requirements on accounting, depending on the legal form of micro-enterprises:

  • “On accounting” Act
  • Cabinet of Minister regulations adopted as of 21 October 2003 “ Regulation Regarding the Conduct and Organisation of Accounting ”

Microbusiness Tax is remitted to the State Budget on a quarterly basis. Microbusiness Tax return has to be submitted on or before 15th day of month following quarter.

The Tax return shall include the following information:

  • Turnover of a microenterprises in the quarter, which from the beginning of the year does not exceed 100,000 EUR
  • Turnover of a microenterprises in the quarter, which from the beginning of the year does exceed 100,000 EUR
  • The information about employees and their incomes
  • Calculated tax from a turnover, number of employees or salary of employee, which exceed criteria of micro-enterprise
  • Total calculated microbusiness tax

The Tax return also shall include a legal form of micro-enterprise (individual merchant; fishing or agriculture; individual), as well as a name of a micro-enterprise and a registration number.