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Criminal liability for non-payment of insurance contributions was introduced
In August 2017 the Federal Law №250-FZ «On Amendments to the Criminal Code of the Russian Federation and the Criminal Procedure Code of the Russian Federation due to the improvement of legal regulation of relations connected with payment of insurance contributions to state non-budgetary funds» dated 29.07.2017 came into effect.
Evasion in payment of contributions is recognized as a crime and falls under the validity of articles of the Criminal Code 198 (Evasion of an individual from payment of taxes, fees and (or) an individual - payer of insurance contributions from payment of insurance contributions) and 199 (Evasion from payment of taxes, fees payable by an organization, and (or) insurance contributions payable by an organization - payer of insurance contributions).
Criminal liability for such crimes for enterprises and individuals occurs in cases if it is committed in a large or especially large amount. The rules of engagement to criminal responsibility and sanctions for crimes are set out in the table.
| Category of contributions’ payers | Rules of engagement to criminal responsibility | ||
| Large amount | Especially large amount | The share of unpaid taxes and fees from the amount payable to the budget | |
| Organization (Article 199 of the Criminal Code of the RF) | More than 15 million rubles or More than 5 million rubles for 3 years in a row | More than 45 million rubles or More than 15 million rubles for 3 years in a row | 25% - by large amount; 50% - by especially large amount |
| individual, including individual entrepreneur (Article 198 of the Criminal Code of the RF) | More than 2,7 million rubles or More than 900 million rubles for 3 years in a row | More than 13,5 million rubles or More than 4,5 million rubles for 3 years in a row | 10% - by large amount; 20% - by especially large amount |
| Category of contributions’ payers | Penalty (sanctions) | |
| Large amount | Especially large amount | |
| Organization, including officials or individual entrepreneurs | fine at a rate of 200 000 - 500 000 rubles or - in the amount of salary (income) for the period from 18 months up to 3 years, or forced labour up to 3 years with or without deprivation of the right to occupy determined posts (to engage in activity) up to 3 years, or deprivation of liberty up to 2 years with or without deprivation of the right to occupy determined posts (to engage in activity) up to 3 years | fine at a rate of 500 000 – 2 mln rubles or - in the amount of salary (income) for the period from 2 to 5 years, or forced labour up to 5 years with or without deprivation of the right to occupy determined posts (to engage in activity) up to 3 years, or deprivation of liberty up to 7 years with or without deprivation of the right to occupy determined posts (to engage in activity) up to 3 years |
| Individual | fine at a rate of 200 000 rubles or - in the amount of salary (income) for the period up to 2 years, or compulsory community service up to 360 hours | fine at a rate of 300 000 rubles or - in the amount of salary (income) for the period up to 3 years, or forced labour up to 1 year, or deprivation of liberty up to 1 year |
| Organizations or individuals that have committed a crime for the first time are exempted from criminal liability if they repay the amounts of arrears, penalty fees and fines in full in accordance with the Tax Code of the RF. | ||
Unpaid amounts may include arrears both in respect of insurance contributions and in respect of taxes and fees.
Thus, the responsibility for non-payment of insurance contributions is equated with responsibility for non-payment of taxes, that was predictable after the administration of insurance contributions to state non-budgetary funds was transferred to the Federal Tax Service from January 1, 2017 (s. more in the article). Such tightening of responsibility will certainly affect the increase in fees to social funds, but also the risk of excessive pressure from regulatory oversight should not be ruled out.
It should be also remembered that, in addition, since October 1, 2017, the procedure for charging penalty fees for organizations has changed. So, in cases of delay in payment up to 30 calendar days the penalty fee is calculated on account of 1/300 of the refinancing rate the Bank of Russia, and starting from the next (i.e. 31st) day, the penalty fee will be 1/150 of the discount rate.