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Is sick leave taxed? Employers are often interested in the question: “Is an employee’s sick leave taxable?”

Sick leave payments are considered income and, accordingly, are subject to personal income tax. But according to the legislative acts of the Russian Federation, there are specifics for calculating such a tax. If an employee is ill, the employer must pay him compensation accrued for the period of illness (Article 183 of the Labor Code of the Russian Federation).

What taxes are imposed on a certificate of temporary incapacity for work?

Money paid for a period of incapacity for work that is associated with illness, although not considered wages, is subject to taxes.

According to the legislative acts of our country, personal income tax on sick leave is calculated in the general manner. It is paid at the expense of the employee and depends on the reasons for his receipt of a certificate of temporary incapacity for work.

A document issued in connection with:

• with an employee's illness;
• caring for sick children or other disabled relatives;
• with quarantine;
• with injury;
• with the need for further treatment in a hospital or sanatorium.

It should be noted that a document confirming temporary disability must be issued only in licensed medical institutions. The diagnosis is not prescribed in it, since it is a medical secret. Only a certain code must be entered on the sheet. It also notes its duration, which is taken as the basis when calculating the benefit.

How can an employer verify the authenticity of a sick leave certificate? Actions to take when a counterfeit is detected

How to calculate the amount of personal income tax from sick leave

So, for funds paid towards any sick leave, except for pregnancy, it is necessary to withhold personal income tax in the usual manner, just as it happens when calculating wages. The income tax rate in 2021 has not changed and remains the usual 13% for entrepreneurs and employees. The calculation principle also remains the same.

NOTE! In addition to income tax, social insurance contributions are withheld from the income of citizens working under an employment contract: to the Pension Fund of the Russian Federation, the Federal Compulsory Medical Insurance Fund. The deduction of social contributions does not apply to “hospital” payments.

An example of calculating personal income tax from temporary disability compensation

An employee of Lorelei LLC, Natalya Levanevskaya, was admitted to the hospital due to acute appendicitis and was treated for 14 days. The average daily earnings of N. Levanevskaya, calculated by an accountant, is 1,456 thousand rubles. per month Thus, based on the data on the certificate of incapacity for work provided by the employee, she is entitled to compensation in the amount of 14 x 1456 = 20,384 rubles. This money was credited to her along with her salary for this month. The organization must withhold personal income tax from this amount, the amount of which will be 20,384 x 13% = 2,649 rubles. 92 kopecks Thus, the amount of 20,384 – 2650 = 17,734 rubles is intended for payment under a certificate of incapacity for work for N. Levanevskaya.

If Lorelei LLC belonged to the jurisdiction of one of the “pilot” regions, for example, the Yaroslavl region, the calculation would look a little different. At the expense of Lorelei LLC, the recovered employee would receive compensation only for the first three days of illness, that is, 1456 x 3 = 4395 rubles. The company will withhold personal income tax only from these funds: 4395 x 13% = 571 rubles. Thus, in addition to the salary, N. Levanevskaya will receive 4395 – 571 = 3,824 rubles.

The remaining funds (for 11 days of incapacity) will be transferred to her by the FSS, who will also act as a tax agent for income tax on them.

11 x 1456 = 16,016 rubles. – the full amount due on sick leave.

16,016 x 13% = 2,082 rubles. – personal income tax amount.

16,016 – 2082 = 13,934 rubles. - for the extradition of N. Levanevskaya.

At the same time, the employer is not responsible for transferring tax funds to the address, that is, to the INFS; his powers and responsibilities are limited only to the amount of 571 rubles. for the first three non-working days.

Cases when tax is not charged

According to the current legislation of the country, personal income tax is not taken from sick leave if it is issued to an employee in connection with pregnancy and childbirth . After submitting such a document and several certificates attached to it to the employer, the employee must receive full compensation within ten days, since these payments are not taxable.

There is also a special case when taxes are not levied on sick leave in 2021 - this is the adoption of a child. A certificate of temporary incapacity for work is issued upon adoption of a child under 3 months of age. for 70 days. The date of birth of the child will be considered the one indicated in the court decision. Personal income tax is not deducted from sick leave issued for such an occasion.

What taxes are withheld from sick leave?

In the case when sick leave is issued to a worker who was undergoing treatment for an illness, injury or who was caring for a sick family member, personal income tax is withheld from the sick leave (Article 226, clause 1.4 of the Tax Code of the Russian Federation). As for contributions to the Pension Fund and the Social Insurance Fund, sick leave is not subject to insurance contributions . There is legal evidence for this.

• From the information contained in Art. 7 of Law N FZ-212, it follows that contributions to a state institution engaged in life and health insurance of citizens are paid only from the income of an employee bound by an employment contract with the employer for the provision of services or performance of work.
• Also according to part 1 of Art. 9 clause 1 of Law N FZ-212, insurance payments are not deducted from state benefits and other types of compulsory insurance coverage.
• Based on the information presented in Art. 8 clause 2 of Law N FZ-165 of July 16, 1999, payment for temporary disability is one of the types of compulsory insurance coverage.

In what cases is tax not charged?

Is sick leave subject to income tax?

As stated above, sick leave is not subject to contributions from the Social Insurance Fund and the Pension Fund of the Russian Federation in any case.

As for personal income tax, there are some types of income, according to a certificate of incapacity for work, from which it is not deducted.

These types are defined in Art. 217 clause 1 of the Tax Code of the Russian Federation. Sick leave contributions are not paid from:

• Benefit provided to unemployed citizens.
• Cash compensation paid to pregnant women.
• Payments for childbirth.

Attention! If the sick leave is issued incorrectly, the employer will require it to be reissued. If the demand is ignored, he has the right to refuse payment for days on sick leave.

Contributions levied by the employer

Taxation on sick leave in 2017-2018 is determined by the provisions of the Tax Code of the Russian Federation. Due to the fact that payments based on a document confirming incapacity for work are made by the employer, he must withhold income tax. Accordingly, the employee receives compensation, from which personal income tax has already been deducted.

Payment of sick leave to a part-time worker. Registration, calculation and amount of benefits

The organization pays only for the first 3 days of sick leave. The remaining days until recovery will be compensated by the Social Insurance Fund. This means that the tax is collected from the amount that is accrued to the employee for the first 3 days of his being on sick leave.

Taxes on sick leave compensation are calculated in the same way as they are levied on accrued wages.

Personal income tax on sick leave is calculated at a rate that is 13%.

Attention! The employee can receive compensation under the document within 6 months. from the date of return to work after recovery, since the duration of sick leave is limited to the above period.

Term and date of withholding personal income tax from sick leave

From the beginning of 2021, the transfer of personal income tax from sick leave and vacation pay must be made no later than the last day of the month in which they were paid.

Is sick leave taxable?

According to the law, sick leave is subject to income tax, the amount of which in 2021 is 13%. This transfer must be completed within a certain period. Now the payment must be no later than the end of the month in which the compensation was paid. Transfers must be completed within the following deadlines:

• when the company received the compensation amount, if the withdrawal took place from a bank account;
• when the amount is transferred to the employee’s account when sending sick leave immediately to the bank account;
• the next day after the provision of compensation from the cash register.

Thus, sick leave sheets have their own procedure for calculation and then accrual to employees. In cases of illness, they must be subject to personal income tax, the amount of which is transferred to the state budget. If there is sick leave for pregnancy and childbirth or child care, then the accrual of personal income tax is not provided.

Personal income tax accounting

To account for personal income tax, you first need to calculate the amount of withholding. You need to do it like this:

• The salary for the previous 2 years is added up, and the resulting total is divided by 730 (the number of days in 2 years). Salaries received in the current year are not taken into account in calculations (see “Gray salary” - responsibility of the employer and employee, consequences);
• the calculations from the previous paragraph gave us the average income for 1 day;
• the average income is multiplied by the number of days spent on forced short-term leave;
• The result was an amount that constitutes sick leave income. But only an employee with more than 8 years of insurance experience will receive it in full. If the years worked are from 5 to 8, then 80% of the amount received is paid, and if less than 5 years, then the payment will be 60%.

If a person did not work for the previous 2 years or did not present a salary certificate, then the calculation will be made as follows:

• the amount of the minimum wage (SMW) is taken and multiplied by the number of days that the employee spent on sick leave;
• divide the amount by the number of days in the month in which the employee was sick;
• the amount received is the average income;
• the following calculation scheme is similar to that described above;.
• the final amount is paid in full, regardless of length of service.

Compensation for a document confirming temporary disability is calculated within 10 days after it is submitted to the organization, and is paid along with the salary following the benefit.

Deadlines for paying personal income tax on sick leave in 2021

The deadline for paying personal income tax when paying for an employee’s temporary disability will be the last day of the month during which sick leave was paid.

If, for example, sick leave was paid on April 10, then the deadline for paying personal income tax will be April 30 (adjusted for the production calendar in a given month, it is better to pay the tax on the last working day of the 28th). Moreover, even if you pay sick leave for an employee on the last day of the month, you will have to pay tax on the same day. But if you make a payment on the first day of the month, then you will have almost a full month ahead to pay personal income tax for this payment.

Naturally, since in most organizations sick leave is paid along with the payment of wages at the beginning of the month, it is not difficult for the accounting department and does not require excessive haste to pay the tax on time.

Correctly filling out the 2-NDFL certificate

In order to correctly issue a certificate reflecting personal income tax on sick leave, you should take into account the advice of the Federal Tax Service. The 2-NDFL certificate must indicate all income received for the required period.

Subsection 3 of the document is filled out as follows:

• in the “month” field, enter the serial number of the month and the amount of funds received;
• the salary amount is displayed for the current month, and the receipt on the certificate of incapacity for work is displayed for the previous month, in which the employee was sick;
• a special code is defined for each amount. The salary is displayed by code 2000, and the amount of compensation by code 2300.

Is personal income tax deducted from sick leave benefits?

Is income tax payable on sick leave? The answer to this question lies in Article 217 of the Tax Code. It contains a list of individual income from which personal income tax is not withheld. There is no compensation for the time of illness, from which we can make an unambiguous conclusion that this tax must be withheld, as in ordinary cases, directly upon its payment (clause 1, 4 of Article 226 of the Tax Code of the Russian Federation). The tax agent - the employer - is obliged to transfer the withheld tax to the budget no later than the last day of the month in which he paid the benefit in favor of his employee. This is directly stated in paragraph 6 of Article 226 of the Tax Code. This provision is relatively new: the amendment applies to 2021.

At the end of the year, the amounts of benefits paid, as well as the personal income tax withheld from them, are reflected in the certificate in form 2-NDFL. These amounts are also taken into account when preparing the quarterly 6-NDFL report.

However, there are also situations in which, when paying sick leave to an employee, his employer is not a tax agent for personal income tax. We are talking about a number of regions of the country where a pilot project has been implemented that involves direct payment of benefits from the Social Insurance Fund, bypassing the employer. In such a situation, a company or individual entrepreneur pays its sick employee only the first three days of temporary disability. Let us remind you that these days are not reimbursed to the employer in one way or another at the expense of the Social Insurance Fund. Further, the employer’s obligations are reduced only to the transfer of documents to the territorial body of the Social Insurance Fund, namely the sick leave itself, as well as a certificate of the amount of the employee’s earnings for the previous two years. After receiving these documents, social insurance pays sick leave directly to the employee’s personal account. Accordingly, the employer faces obligations to withhold personal income tax in such a scheme only when paying for the first three days of sick leave.

Interesting facts about sick leave

• In the current year 2021, sick leave turns 80 years old. The first temporary disability certificate was issued in our country in 1937.
• From July 1, 2021, a gradual transition to electronic temporary disability certificates begins
• In Germany, an employee can be absent due to illness for 3 days without issuing an official document and without losing his salary. It is enough to warn the employer with a telephone call (see Being late for work: fine or dismissal?).
• Sick leave taxes in 2021 have not undergone any changes compared to the previous year. This means that there are no special problems with their calculation.

Sick leave taxation 2021 - example of calculations

Let’s assume that the store salesperson was on sick leave from 06/01/18 to 06/08/18. The bulletin was issued in accordance with legal regulations. The accountant calculated the benefit amount for 8 days (calendar) and accrued:

• For the first 3 days – RUB 3,550.00.
• For the remaining 5 days – 5850.00 rubles.

What taxes are charged on sick leave in 2021? There is no need to withhold insurance premiums for medical, pension, social insurance, or “injury”. It is necessary to accrue, withhold, and transfer income tax to the budget. In accounting, the transaction looks like this:

• D 44 K 70 for 3550.00 rub. – the accountant calculated the amount of sickness benefits at the expense of the company.
• D 69.1 K 70 for 5850.00 rub. – the accountant calculated the amount of sickness benefits at the expense of Social Insurance.
• D 70 K 68.2 for 1222.00 rub. – income tax is charged on the entire benefit amount.
• D 70 K 51 for 8178.00 rub. – the company transferred benefits to the employee’s card.
• D 68.1 K 51 for 1222.00 rub. – the company paid personal income tax to the state.
• D 51 K 69.1 for 5850.00 rub. – after an inspection, Social Insurance reimbursed the employer for sick leave expenses.

Conclusion - in this article we looked at what taxes sick leave is subject to in 2021. According to current legal requirements, insurance premiums are not required to be charged on benefit amounts. With regard to income tax, the withholding obligation arises depending on the type of payment. There is no need to pay personal income tax on maternity benefits, but on regular benefits, including care for sick children, it is necessary.

When is tax withheld and transferred?

Expert opinion

Novikov Oleg Tarasovich

Legal consultant with 7 years of experience. Specializes in criminal law. Member of the Bar Association.

According to Federal Law No. 113 of May 2, 2015, now the transfer of personal income tax from sick pay is not tied to the day of actual payment of this income. The tax is collected on a specific calendar day.

Personal income tax from payments for closed sick leave is transferred to the local Federal Tax Service of the Russian Federation. This is done until the end of the month in which such benefits are paid (Article 226 of the Tax Code of the Russian Federation).

After submitting a closed certificate of incapacity for work to the accounting department of the employing company, the employee is paid a specific benefit. This money is credited to the employee’s card within 10 days from the date of presentation of such a medical certificate.

Example

Ivanova O.P. opened sick leave on February 5, 2021, and closed it on the 9th of this month. Based on a closed certificate of incapacity for work, Ivanova was paid for treatment on the day 50% of her salary was issued - February 25, 2021. In this case, the income tax from individuals from such a payment was transferred to the Federal Tax Service of the Russian Federation on the 27th.

Changes in the taxation of sick leave benefits in the year

Taxation of sick leave benefits in 2021 and the new year included payments of income taxes from individuals. Please note that contributions are not paid from the sheet. The tax rate remains the same and is equal to 13% of the income.

Funds for payment of benefits are currently taken according to the following principle:

• 3 days of starting are paid by the company;
• the rest of the period is compensated by the FSS of the Russian Federation.

These standards are established in Art. 3 clause 2 and clause 1 of the federal law on insurance contributions (No. 255-FZ). Sick leave benefits for caring for a child or a relative and personal income tax are paid in full by the Social Insurance Fund. After dismissal, the employee may demand payment of compensation for sick leave after complying with certain standards specified in Art. 4 clause 2 of Federal Law No. 25-FZ.

From the beginning of 2014 until the year (and possibly in the future), it was planned to introduce a new procedure for sick leave payments, according to which they should be made directly by the Social Insurance Fund, and not by the employer. After this update, it will become easier to control payments. Until it is approved, taxation will be carried out according to existing legislation.

Do I need to pay personal income tax?

It has been established that in general it is necessary to pay personal income tax on sick leave. This is due to the fact that in the Tax Code, benefits assigned on the basis of sick leave are not included in the list of those for which exemption from personal income tax is provided.

Cases for which the general rule applies include the following:

• the employee was injured or fell ill, did not work for a certain period and issued a sick leave;
• the employee cared for a sick child, did not work for a certain period and issued a sick leave;
• the employee was in quarantine and did not go to work because of this.

At the same time, there are two cases that deviate from the general rule, namely:

• a woman's pregnancy and childbirth;
• adoption by foster parents.

In these cases, sick leave is issued, but this fee is not charged. If the employer makes additional payments in excess of the funds that he is obliged to transfer in the last two cases, then personal income tax will certainly be charged on such optional payments at the established rate of 13%.

Sick leave for pregnancy and childbirth

The law provides for so-called maternity leave for women. It is formalized as paid maternity leave (B&L) for a period of 140 calendar days, divided equally - 70 days before childbirth and the same amount after childbirth.

During vacation, sick leave is issued. Since there are singleton and multiple pregnancies, the leave may be extended depending on the circumstances.

The same B&R benefit is provided to adoptive parents of babies under three months of age. In this case, an additional 70 days of vacation are added to the time of birth of the child. When adopting several children, the leave will be 110 days, counting from the day of their birth.

The calculation of the subsidy is based on the average salary for the two previous years. The legislation provides options for regulating the minimum and maximum amounts of payment of benefits.

The Social Insurance Fund fully finances sick leave related to pregnancy and childbirth for women. Income that expectant mothers are supposed to receive is not taxed.

In some situations, the employer takes the initiative to provide financial support for maternity and voluntarily pays extra in excess of the required state benefit. It all depends on how the surcharge will be processed.

In such circumstances, income tax on this amount must be withheld. If an employer issues financial assistance of no more than 50,000 rubles, then this amount is not subject to tax.