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Legal status of an individual entrepreneur in the Russian Federation. Civil law status of an individual entrepreneur - features of doing business Individual entrepreneurs have the status of individuals

Almost every citizen can open an IP. The legal status of an individual entrepreneur has a lot of advantages over such a legal form as a legal entity. After all, the owner of the IP can manage without deep knowledge of accounting and without an accountant. However, even in this seemingly simplest area, there are a lot of pitfalls, so it’s worth getting acquainted with the legal personality of an individual entrepreneur even before contacting the IFTS.

Who can become an entrepreneur

Any adult, capable and respectable citizen of the Russian Federation can receive the coveted status. Provided that he has a residence permit, and the type of future activity is included in the list allowed for this legal form.

Even if the age of majority is still far away, a citizen can try his luck with the consent of his parents (guardians), a court decision on full legal capacity or a copy of the marriage certificate.

The following persons will receive an unequivocal refusal to register as an individual entrepreneur:

  • In whose name an individual entrepreneur has already been opened, since federal law No. 129 prohibits the opening of two or more individual entrepreneurs by one citizen.
  • Persons who were refused by a court decision (Federal Law No. 129, 22.1 art., 4 p.).
  • Persons convicted under articles 105.125, 228.245, 126.127, 275.284, 131.135, 205.227, 150.157 of the Criminal Code of the Russian Federation.
  • Incapacitated or drug addicted persons.
  • Civil servants and employees of municipal institutions.
  • Foreigners without a temporary residence permit.

How to get IP status

The only body that is authorized to register an individual entrepreneur is the Federal Tax Service. But even here there are nuances. A citizen must apply to the authority at the place of residence, but not all authorities are endowed with registration powers, for example, in Moscow there is only one such branch - the 46th.

To obtain the legal status of an individual entrepreneur, you need to provide a mandatory package of documents to the registration window of the Federal Tax Service Inspectorate and pay a state duty. Everything is simplified to the limit here, since the IP works alone and does not need a charter designed to divide rights, duties and shares of capital between co-founders.

Document Description
Statement P21001 It must be issued in accordance with the Order of the Federal Tax Service No. ММВ-7-6/25
Copy of the passport Foreign citizens must add to it a permit to stay in the Russian Federation
Written consent of parents (guardians), a copy of the marriage certificate or a court decision on the legal capacity of a citizen For minor citizens
Receipt for payment of state duty Cost 800 rubles
Certificate of no criminal record and no criminal prosecution, decision of the commission on juvenile affairs Required only if future activities are related to education, medical care, upbringing, sports training for underage children.

You can send documents to the Federal Tax Service not only in person, but also in other ways:

  • by mail with a description of the attachment;
  • through a trustee in the presence of a power of attorney certified by a notary;
  • online through the FTS website.

Status characteristic

Entrepreneur is simple individual, which has the right to conduct commercial activities without forming a legal entity and is endowed with specific rights and obligations.

The legal personality of an individual entrepreneur is characterized by the fact that the same rules apply to individual entrepreneurs as to natural persons, as well as some rules of the Civil Code of the Russian Federation that regulate the activities of legal entities. Such duality is the main feature of the civil law status of an individual entrepreneur.

What is IP based on?

As soon as the individual entrepreneur receives the USRIP record sheet (a certificate has not been issued since 2017) and collects all the documents necessary for entrepreneurship, he can start working.

Unlike legal entities, entrepreneurs do not have constituent documents, since they are not necessary. Why? A private businessman acts alone, and after registering an IP, a new commercial facility is not created, even the TIN of the IP and the TIN of an individual are the same number. But the organization can be owned by several founders at once, so they need a charter with a clear distribution of rights, duties and shares of capital. Yes, and TIN organizations are assigned a separate one, in no way connected with the TIN of the founder.

If a legal entity acts according to the charter of an enterprise, then an individual entrepreneur - exclusively based on the very fact of acquiring IP status. In contracts, he must indicate his status and indicate the required details. There is no need to make any clarifications in the form of "acting on the basis of ...".

However, in order for the actions of the entrepreneur to be legal, he must store in his accounting department and provide, as necessary, all mandatory documents. Both legally important and accounting. Legally important papers include:

  • passport of a citizen of the Russian Federation;
  • the USRIP record sheet, which has been issued instead of a certificate since 2017;
  • certificate of registration, which was issued before 2017;
  • certificate of TIN;
  • notice of tax registration.

The list of documentation secondary in importance depends on the type of activity and on the specifics of doing business. It may include:

  • personnel nomenclature (if the entrepreneur employs workers);
  • health and safety briefings (for individual entrepreneurs with staff);
  • licenses (when performing specific types of work);
  • tax documentation (mandatory for all reports, declarations and other papers).

Rights and benefits

A citizen who has received the legal status of an individual entrepreneur retains the rights of an individual and acquires a number of specific rights:

  • He has the right to perform all actions not prohibited by law, the purpose of which is to make a profit.
  • The peculiarities of the legal status of an individual entrepreneur allow him to count on protection in arbitration courts if the dispute concerns entrepreneurial activity, or in civil courts if the dispute affects civil law relations.
  • An individual entrepreneur has the right to use his personal property and property, for example, a vehicle, for commercial purposes. In this case, the norms of the law for individuals apply to him, that is, he will pay the transport tax as an individual. The same property can be used for personal purposes.
  • The status of an individual entrepreneur allows you to apply the patent taxation system, on which there is absolutely no reporting. Plus, taxpayers on special regimes (USN, UTII) may not pay personal income tax and VAT.
  • An entrepreneur has the right to join the ranks of employers, but in some special regimes the number of hired employees is limited. For example, only employers who have hired no more than 10 people can switch to PSN.
  • A "private trader" has the right to work for hire, enter into legal relations as an individual, become a founder or co-founder of organizations. He can become the director of his own individual entrepreneur, but in this situation he will have to pay insurance premiums for himself both as an individual entrepreneur and as an employee.

Responsibilities

The special legal status of an individual entrepreneur imposes on him obligations and restrictions that apply to individuals and legal entities. Among the most important are:

  • Mandatory payment of taxes, the list of which depends on the chosen tax regime.
  • Paying contributions to your pension and health insurance. And if the taxpayer hired staff, then contributions for him: on account of a future pension, for medical care and in the FSS (Social Insurance Fund).
  • Delivery of certain reports, the type of which depends on the taxation system, and storage of all acts, contracts, legally important papers and other documents within the period established by legislators.
  • The impossibility of entering the state, civil and any other service.
  • Conducting only those activities that are permitted for individual entrepreneurs and entered in the USRIP at the time of registration.
    To change the main or additional types of activity, you need to apply for a change in information to the USRIP.

Another important feature of the civil law status of an individual entrepreneur is that he is liable for unfulfilled obligations with all his property and property even if they are not engaged in business. And he cannot dispose of property acquired during marriage without the consent of the spouse. Of course, if this nuance is not provided for in the marriage contract.

Loss of entrepreneur status

The status of an individual entrepreneur is canceled:

  • by personal decision of the businessman;
  • in case of death;
  • By the tribunal's decision;
  • when canceling a permit for temporary/permanent residence of a foreigner in the Russian Federation.

Features of bankruptcy

Business is always risky. Even well-thought-out strategies cannot give a 100% guarantee of stable growth. If debts grow like a snowball, and the entrepreneur’s funds are no longer enough to pay debts to creditors, the arbitration court will rule on the bankruptcy of the individual entrepreneur.

An entrepreneur can apply for bankruptcy:

  • the business entity itself;
  • creditors, but only those whose requirements are directly related to the activities of this individual entrepreneur;
  • authorized body.

If the bankruptcy procedure has already begun, other creditors whose requirements do not correlate with the activities of the individual entrepreneur, as well as ordinary persons acting as creditors, can also present their claims.

Persons with the status of an individual entrepreneur are liable to the court with all their property. And those that are involved in entrepreneurship, and those that are used only for personal needs.

State of affairs after bankruptcy:

  • The court enforces the claims of creditors in a special manner (according to the degree of importance). After making the calculations, for which there were enough funds, the businessman is released from the fulfillment of all remaining obligations related to entrepreneurship. But not from personal requirements.
  • At the time of bankruptcy, the state registration of an individual entrepreneur and all licenses issued to a businessman are canceled.
  • After bankruptcy, a citizen will not be able to restore his legal status as an individual entrepreneur. It will also not be possible to get it again until 5 years have passed after the completion of the bankruptcy procedure.

Advantages and disadvantages

The dual legal status of an entrepreneur has its advantages and disadvantages, which can help or hinder business development.

Some regions seek to support small businesses and introduce a huge number of benefits, which makes the status of an entrepreneur even more attractive. However, when choosing a form of legal personality, it is necessary to evaluate not only the simplicity and complexity of doing business. Some will be comfortable within the framework of entrepreneurship, and some will feel cramped, so before making a final decision, weigh the pros and cons.

What are the features of the legal status of an individual entrepreneur? Many people planning to start their own business are faced with the choice of its organizational and legal form. Let's consider what advantages and disadvantages the status of an entrepreneur has, as well as what you need to know before proceeding with its official registration?

The right of citizens to engage in entrepreneurial activity is enshrined in the Civil Code of the Russian Federation (Article 23).

Any capable citizen of Russia over 18 years of age has the right to organize activities whose purpose is the systematic extraction of profit. That is, become an entrepreneur.

From what moment does the legal status of IP arise? Please note that the status of an individual entrepreneur appears only after official registration. Accordingly, the legal status comes from the moment the federal tax service issues the certificate of registration as an entrepreneur to the applicant. Entrepreneurial activity without registration on the territory of Russia is prohibited and punishable by law.

The right of citizens to engage in entrepreneurial activity is enshrined in the Civil Code of the Russian Federation.

Registration of IP status

Currently, registering as an individual entrepreneur with the federal tax service and obtaining the appropriate certificate is quite simple. The best way to do this is through the public services portal.

Find the section "Registration of legal entities and individual entrepreneurs" on the portal. Fill out the form provided by the portal. You will also need to upload scanned documents - a copy of the passport and receipts for payment of the state fee.

You can also check the status of an individual entrepreneur through the electronic register of legal entities. To do this, you will need to enter the TIN of the entrepreneur or his full name, indicating the region. Such a service is sometimes necessary for counterparties to check the details of the entrepreneur, or for the businessman himself to find out whether his registration was successful or, vice versa, whether the termination of the status has come into effect.

Sole Proprietor is a natural or legal person

Consider the features of the legal status of IP. Let's start with how an entrepreneur differs from a legal entity. Often the question is: To whom are individual entrepreneurs closer - to legal entities or to individuals?

The answer to this question is quite simple - an individual entrepreneur is not a legal entity and has rights and obligations that are different from it, but at the same time it has specific differences from an individual. Sole proprietorship is a special status that implies a specific taxation regime, the risk of loss and loss of property, and some other features.

Features of the status of an entrepreneur

Consider what constitutes the civil law status of an individual entrepreneur:

  1. The legality of the IP status is confirmed by the presence of official registration with the tax service. Entrepreneurial activity conducted without official registration is prosecuted by law.
  2. The legal personality of citizens engaged in the systematic extraction of profit stems from the fact that they have property rights - the right to benefit from their own property, as well as from the right guaranteed by the Constitution to apply their own knowledge and skills for self-realization.
  3. The income of an entrepreneur is in no way limited by law, as well as his right to use any property that is in civil circulation for profit.
  4. In case of losses due to the fault of commercial organizations or authorities, the entrepreneur has the right to apply to the arbitration court for their compensation.
  5. The legal status of an individual entrepreneur allows you to conduct business personally, and also allows you to hire employees (from 5 to 250 people, depending on the size of the enterprise).
  6. In accordance with the requirements of Russian legislation Individual entrepreneurs cannot engage in certain sectors of the economy:
    • production and retail trade in alcohol;
    • insurance;
    • banking;
    • investment funds;
    • non-state pension funds;
    • security activities, production and circulation of weapons (ammunition);
    • television and radio broadcasting;
    • space industry.
  7. Entrepreneurs operate at their own risk. In the event of loss or bankruptcy, they are liable with personal property (with the exception of a few categories of property). The following are not subject to withdrawal:
    • the only living space (however, this does not apply to mortgages);
    • items for personal use;
    • property necessary in professional activities;
    • breeding animals and seeds, even if not used in the main activity;
    • money in the amount necessary to support the family (living wage), as well as food.

An individual entrepreneur is not a legal entity and has rights and obligations that are different from it, but at the same time it has specific differences from an individual.

Other IP rights

Russian legislation gives individual entrepreneurs a number of rights and privileges. We have named some of them in the previous section, but also note that:

  1. Individual entrepreneurs do not pay personal income tax (for more details on taxes, see the relevant section).
  2. The activities of the IP are counted in the length of service.
  3. An entrepreneur is also entitled to work under an employment contract (except for a number of “prohibited” positions). He can also act as a founder of a legal entity, participate and create public organizations.
  4. The right to use the seal and the current account, but also the right to refuse them.

Responsibilities of individual entrepreneurs

However, in addition to rights and benefits, entrepreneurial activity implies a number of specific duties, the failure to fulfill which will necessarily entail problems.

  1. Payment of taxes and mandatory insurance payments several times a year, including for hired employees.
  2. Submission of financial statements within the time limits established by law.
  3. It is forbidden to combine entrepreneurial activity with state and municipal service. If a former entrepreneur plans to enter the state or municipal service, a certificate of the absence of the status of an individual entrepreneur will be proof of the completion of his independent activity. You can also issue this document on the official website of the tax service.
  4. The status of an individual entrepreneur is not inherited, however, a businessman has the right to transfer to his heirs all the property and means of production necessary for work.

How self-employed people pay taxes

A very important issue regarding the legal status of individual entrepreneurs is the payment of taxes and mandatory payments. First, let's look at what categories of taxes and contributions are required. They can be conditionally divided into 3 categories:

  1. Income tax (instead of personal income tax). The amount depends on the tax regime.
  2. Pension and health insurance. The amount of these payments is fixed. Pension - 26645 rubles + 1% of income if it exceeds 300 thousand rubles. Medical - 5840 rubles.
  3. Transport and land tax in the presence of the specified property are paid according to the rules for individuals.

A very important issue regarding the legal status of individual entrepreneurs is the payment of taxes and mandatory payments.

Simplified taxation system

The most profitable and therefore common taxation system for individual entrepreneurs is the simplified tax system., the so-called "simplification". In this case, income tax is paid either at a rate of 6% of income or at a rate of 15% of working capital. An entrepreneur on a “simplified” system does not pay personal income tax and VAT, but pays insurance and personal income tax in the amount of 13% for his employees.

Taxation according to UTII

The imputed activity tax is calculated using a formula based on the basic income and activity rate, as well as the inflation rate. It is 15% of imputed income. Under this taxation regime, personal income tax and VAT are also not paid, and 13% is paid from the income of employees.

Filling out a payment order

What status of the IP payer should be indicated when filling out a payment order? Due to the fact that the legislation very strictly regulates the scope of paying taxes and other obligatory payments, errors in filling out are unacceptable. Remember that individual entrepreneurs indicate the code "08" when making payments to the Pension Fund and the Social Insurance Fund, "02" when paying personal income tax.

Also note that IP pays personal income tax for employees. What status should be specified then? With contributions for employees - "09". Since 2018, the status of an individual entrepreneur in payments on the simplified tax system is indicated by the code "09". The status is indicated in the topmost line of the payment order in the "101" field.

How often do you have to pay taxes

Individual entrepreneurs pay taxes 4 times a year - by quarters. For the first - in April, for the second - in July, for the third - in October, for the fourth - in the first months of the next year. Also, before April 30 (sometimes the deadline can be postponed for several days due to holidays and weekends), you need to submit a tax return.

The most common case of loss of IP status is the refusal of the citizen himself to engage in entrepreneurship and the submission of an appropriate application.

How can I lose the status of an individual entrepreneur

Loss of IP status is possible in several situations. The most common is the refusal of the citizen himself from doing business and filing an appropriate application. Cancellation of state registration takes place on the same day. Other reasons for deprivation of status include:

  • bankruptcy;
  • admission to the state and municipal service;
  • partial or complete incapacity of a citizen;
  • death.

Conclusion

The legal status of an individual entrepreneur gives a citizen a specific set of rights and obligations. It has a special tax regime. The legality of activities for independent profit-making is determined by the presence of state registration.

An entrepreneur is an intermediate link between an individual and a legal entity. This organizational and legal form is suitable for start-up businessmen and small businesses. However, please note that Russian law prohibits entrepreneurs from operating in certain industries.

For many who are just starting to enter the business, the legal status of an individual entrepreneur is not always clear. Meanwhile, an accurate understanding of the essence and significance of this provision is simply necessary when choosing one or another organizational and legal form for one's own business.

Unfortunately, the level of legal literacy, despite the abundance of lawyers, in our country is often not at a very high level. As a result, even quite promising business ideas turn out to be unrealized for the simple reason that a person could not fully understand all the nuances that the status of an individual entrepreneur brings with it. the result of this is either a failed business, or a complete rejection of the implementation of your idea.

Features of the IP status

First of all, we note that the legal status of an individual entrepreneur has a dual nature, therefore, the norms of legislation applicable to individuals, as well as business entities, are simultaneously applied to it.

This duality is caused by the fact that a citizen who has expressed a desire to carry out entrepreneurial activity receives such a right, but at the same time he does not create a new economic entity and, to a certain extent, receives a more extensive list of civil rights.

Features of IP activities

The most significant right in acquiring the status of an individual entrepreneur is the ability of a citizen to carry out any business activity that is not prohibited by law, which allows you to make a profit.

At the same time, a number of duties are assigned to him, the fulfillment of which provides for the legal status of an individual entrepreneur. For example, on the payment of mandatory tax payments, fees and contributions to off-budget funds.

At the same time, in many legal relations, an individual entrepreneur acts on the basis of the norms of legislation for individuals. For example, if he uses for commercial purposes vehicles that are registered to him, then he also pays transport tax as an individual, in the manner prescribed for this category of taxpayers.

There is also no distinction in relation to other property of a citizen-entrepreneur. For example, in the event of his bankruptcy, everything that belongs to the entrepreneur is included in the bankruptcy estate, regardless of the purpose for which this or that property was used.

Peculiarities of judicial protection of the rights and interests of individual entrepreneurs

Another feature in the status of an individual entrepreneur lies in the options for judicial protection of his interests. Thus, the protection of the rights of individual entrepreneurs, as a business entity, is carried out in the Arbitration Courts. And disputes arising from civil law relations of an entrepreneur as a citizen are subject to consideration in courts of general jurisdiction. Therefore, it is extremely important, in the perspective of litigation, to determine on the basis of what an individual entrepreneur acts in a given situation, or rather, as someone, a citizen or an entrepreneur. Depending on this, a further scheme for the protection of rights and interests is being built.

Features of the civil law status of an individual entrepreneur

Note that at the moment there is no regulatory legal act that would regulate in detail the civil law status of an individual entrepreneur. Meanwhile, attempts to prepare such a bill have been made repeatedly, both at the level of the legislature and in the form of initiatives from various public organizations. In a number of regions, local legislative acts have been adopted at the local level, which emphasize the special position of citizens with the status of individual entrepreneurs. First of all, these legal documents are related to measures to support small businesses.

Nevertheless, the adoption of a single law at the federal level, which would legislate the specifics of the legal status of individual entrepreneurs, would greatly facilitate life, both for the entrepreneurs themselves, and for their counterparties and government agencies. Until then, it is necessary to be guided by many regulatory documents that contain provisions regarding the status and features of the work of an individual entrepreneur.

For a detailed disclosure of all the nuances of the position of a citizen registered as an individual entrepreneur, it makes sense to consider all the strengths and weaknesses of such a situation. By the way, it is this analysis that best reveals the features of the legal status of an individual entrepreneur.

Benefits of being an individual entrepreneur

p> Note that all the advantages of registering a citizen as an individual entrepreneur can be divided into two groups:

  1. advantages over the usual position of a citizen;
  2. advantages of an individual entrepreneur in comparison with other organizational and legal forms of entrepreneurial activity.

Advantages of individual entrepreneurs over ordinary citizens

In comparison with general civil rights, the civil legal status of an individual entrepreneur significantly expands the possibilities of a citizen. Most importantly, he is given the right to conduct entrepreneurial activities. A citizen who is not registered as an individual entrepreneur does not have the right to carry out any commercial operations aimed at making regular profits. Otherwise, he may be held liable, depending on the consequences of criminal or administrative.

In the field of taxation, an individual entrepreneur is exempt from paying personal income tax, which is mandatory for all citizens of the Russian Federation to pay on most types of income received.

Advantages over legal entities

An individual entrepreneur has even more advantages compared to legal entities, which are also created for profit in the course of entrepreneurial activity. For example, the costs of registering an individual entrepreneur are minimal, there is no need to prepare many documents, pay the authorized capital, or search for a legal address. In the process of carrying out its activities, an entrepreneur can do without such mandatory for legal entities. entities attributes like checking account and seal. Tax legislation provides for individual entrepreneurs a greater number of tax regimes, and administrative legislation provides for a smaller amount of penalties.

The organizational and legal form of an individual entrepreneur allows him to independently manage all the income received in the process of entrepreneurial activity.

The mode of use of property, which an individual entrepreneur can use both for commercial purposes and for his own needs, has also been significantly simplified. By the way, family members of an entrepreneur also have the right to dispose of property, including those used in their business activities.

Meanwhile, commercial activity is not the only thing that an individual entrepreneur can do. The legislation does not restrict his right to work for hire, with the exception of certain positions, to be the founder of legal entities, the founder or member of public organizations, to enter into various legal relations as an individual.

Disadvantages of IP status

At the same time, the acquisition of the status of an individual entrepreneur imposes certain obligations and restrictions on a citizen. We have already noted that from the moment of registration of an individual entrepreneur, a citizen is obliged to make payments established by law to extra-budgetary funds and taxes. In addition, he must regularly submit the established reporting forms provided for business entities. And when using hired personnel, perform the duties of a tax agent for the transfer of mandatory payments from the income of individuals.

Restrictions of individual entrepreneurs

There are also certain restrictions for persons with the status of individual entrepreneurs. For example, they cannot be accepted into the state civil or other service. In addition, there are certain restrictions that directly relate to the implementation of entrepreneurial activities. So, there is a certain list of activities, the implementation of which is closed to individual entrepreneurs.

Cons compared to legal entities

We also note that situations of refusal of a transaction with an individual entrepreneur in favor of a legal entity are not uncommon, since for many managers and business owners, as well as ordinary citizens, the status of a legal entity. face is more attractive than IP. The reasons for this opinion are different and require a separate detailed discussion.

However, the most significant drawback of the status of an individual entrepreneur, which most often leads to the rejection of such an organizational and legal form, is that an individual entrepreneur is liable for his obligations with all the property that belongs to him by right of ownership. The Civil Code provides that an individual entrepreneur carries out his activities at his own risk. As a result, failures in business can lead not only to its loss, but also to the loss of most of the property of the entrepreneur's family.

What other disadvantages are there?

The right of ownership of individual entrepreneurs has another nuance, which for some reason is rarely paid attention to in practice. The fact is that if an entrepreneur is married, then all his income received in the course of entrepreneurial activity, as well as property acquired from them, in case of divorce, are subject to division between spouses.

As a general rule, this division is carried out in equal shares, while property used for commercial purposes is also subject to division. Moreover, even if one of the spouses acquired the status of an entrepreneur before marriage, then all income received from entrepreneurial activity after marriage will be recognized as the common property of the spouses. The only exception is if a marriage contract is concluded between the spouses, which contains a provision on the division of income of the spouse who has the status of an individual entrepreneur.

In addition, an individual entrepreneur is not entitled, without the consent of the spouse, to dispose of real estate that was acquired during marriage, including if this real estate is used solely for the purpose of carrying out entrepreneurial activities.

Summary

Thus, the legal capacity of an individual entrepreneur is a kind of “extension” of the rights of an ordinary citizen. This status provides him with an opportunity for wider opportunities in economic activity, but at the same time requires him to comply with certain requirements not only in the process of entrepreneurial activity, but also in everyday life.

For example, it is not uncommon for an entrepreneur who has the habit of spending part of the profits from a business for his own needs, and does the same with targeted funds received as part of supporting small businesses or obtaining a loan. And if in the first case there are no restrictions on the use of profits, then in the second situation, this may lead to negative consequences in the future.

By the way, the mistake of many novice entrepreneurs often lies not in the reasonable expenditure of proceeds. As a rule, not a very psychological attitude works: “my profit, I do what I want”. As a result, the business is left without financial support, and often deprived of the opportunity to make the necessary payments.

This problem is not unique to our country. In many countries where the legislation provides for a legal position similar to that of an individual entrepreneur, applicants for this status undergo psychological testing, which allows them to determine a person’s ability to run their own business.

In Russia, for the time being, the conditions for acquiring the status of an individual entrepreneur do not provide for such a mandatory procedure, which may be why people who are deprived of an entrepreneurial spirit often get into business. As a result, many good ideas remain unrealized, and a person is disappointed in his abilities. And if the loss of the status of an individual entrepreneur is also accompanied by serious debt repayment costs, then tragedies are not uncommon here.

All this makes you think again and firmly weigh your capabilities in the implementation of your plans, and if you have faith in yourself and it is justified, then it makes sense to take risks and open your own business.

  • Economy

Keywords:

1 -1

Individual Entrepreneur (IP)- registered in the manner prescribed by law and carrying out entrepreneurial activities without forming a legal entity.

Status of an individual entrepreneur

To acquire the status of an individual entrepreneur, a citizen must have the following general features of a subject of civil law:

    Legal capacity (the ability to have civil rights and bear obligations);

    Legal capacity (the ability to acquire and exercise civil rights by one's actions). Only capable citizens can carry out entrepreneurial activities, that is, those who are able to independently perform legal actions, conclude transactions and execute them, acquire property and own, use and dispose of it. As a general rule, civil capacity arises in full from the onset of adulthood (upon reaching 18 years of age);

    Have a place of residence (a place where a citizen lives permanently or predominantly).

The status of an individual entrepreneur is acquired as a result of state registration of a citizen as an individual entrepreneur.

Registration of an individual entrepreneur

A citizen has the right to engage in entrepreneurial activities without forming a legal entity from the moment of state registration as an individual entrepreneur, and state registration can only be carried out at the place of his official permanent registration at the place of residence.

To register an entrepreneur, you must prepare the following documents:

    a copy of the passport and certificate with the TIN number;

    receipt of payment of the fee;

    an application for registration of an individual entrepreneur of a certain sample in two copies.

Basic rights and obligations of an individual entrepreneur

Citizens registered as individual entrepreneurs have rights and obligations.

IP rights:

    Ability to choose the types of activities permitted by law.

    The right to hire workers.

    Freedom to choose partners and products. The entrepreneur himself determines the market segment in which he will develop his business.

    The right to independently determine the cost of goods and services offered.

    The individual entrepreneur himself decides how and how much to pay his employees.

    The entrepreneur has the right to dispose of the profits as he pleases.

    An individual entrepreneur has the right to appear in court as a plaintiff and a defendant.

An individual entrepreneur is a business entity that also has certain responsibilities. Namely:

    All individual entrepreneurs are required to adhere to the norms of the current legislation.

    All cash transactions are documented. Such documents include, a contract for the supply of goods, etc.

    To carry out licensed types of business, an entrepreneur must obtain a state permit - a certificate, patent or license.

    All employees who are hired by an individual entrepreneur must be officially registered. That is, an individual entrepreneur concludes an employment contract with a person, an agreement on the performance of specific work, or other agreements. After completing the documents, the entrepreneur is obliged to make the necessary contributions to the Medical Insurance Fund, the Pension Fund and the Social Insurance Fund.

    If the activities of an individual entrepreneur cause harm to the environment, he is obliged to take measures to reduce negative impacts. If a businessman cannot resolve this issue on his own, he must contact the environmental service.

    The entrepreneur is obliged to pay taxes to the state treasury in a timely manner.

    An individual entrepreneur is a participant in market relations who must always respect the rights of the buyer.

    If, for some reason, the IP has changed data (surname, place of registration or residence, type of activity), he is obliged to notify the relevant authorities - the tax office, funds and other institutions.

IP taxes and fees

An individual entrepreneur is obliged to pay a fixed payment to social funds, regardless of income.

There are four taxation systems:

    Ordinary system of taxation (OSNO);

    Simplified taxation system (USNO);

    Single tax on imputed income (UTII);

    Patent taxation system (PSN).

Advantages and disadvantages of IP status

The status of an individual entrepreneur has the following advantages compared to registering your own enterprise:

    simplification of the processes of creating and liquidating a business;

    free use of own proceeds;

    Individual entrepreneur (IP): details for an accountant

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      Rules for filling out and submitting a declaration by individual entrepreneurs? An individual entrepreneur must submit a declaration after... completing and submitting a declaration by individual entrepreneurs? Sole Proprietors are required to submit Form 3-... Expenses and Business Transactions for Sole Proprietors”). The total amount of expenses is indicated ... 2 of the Procedure for filling out the declaration): TIN of an individual entrepreneur; revision number (when presenting...

    • The death of an individual entrepreneur: what about business transactions and taxes?

      Operations and obligations of an individual entrepreneur. Property, rights, obligations (obligations) of an individual entrepreneur that existed at the time ... . Documents stored / held by an individual entrepreneur In the course of the activities of an individual entrepreneur, he accumulates ...: transfer wages to employees of an individual entrepreneur; pay invoices issued to an individual entrepreneur, accrued taxes; issue...

    • Responsibility of an individual entrepreneur for violation of the deadlines for submitting the SZV-M form

      Circumstances: an individual entrepreneur is brought to administrative responsibility, who has already been brought to administrative responsibility ... that the contested legal provision applies to an individual entrepreneur who acts as an insured in respect of ..., if such an obligation is not fulfilled by an individual entrepreneur, it becomes possible to interpret, assuming, .. .one imperfection of the current legislation: now individual entrepreneurs will not be held accountable...

    • On the impact of the OKVED codes declared in the USRIP on the tax and legal qualification of the activities of an individual entrepreneur

      Entrepreneurial activity. On the contrary, if an individual entrepreneur carries out activities outside the scope of types ... information about an individual entrepreneur contained in the Unified State Register of Individual Entrepreneurs. Non-submission (... the totality of the above norms implies that an individual entrepreneur initially has a common (universal) ... 1. The nature of the operation. For example, an individual entrepreneur carries out retail trade in food products ...

    • The Supreme Court supported individual entrepreneurs - "simplifiers"

      How to calculate insurance premiums for individual entrepreneurs in 2017? Individual entrepreneurs using the USNO with ... are distributed. The revolutionary decision of the Armed Forces of the Russian Federation An individual entrepreneur applying the simplified taxation system with an object ... to the court of first instance. The position of an individual entrepreneur. The individual entrepreneur argues that it is unlawful to calculate ... contributions payable by the individual entrepreneur for himself. But an individual entrepreneur turned to the RF Armed Forces ...

    • The Supreme Court on the limitation on the value of fixed assets when individual entrepreneurs apply the simplified tax system

      Exceeded by an individual entrepreneur during the reporting (tax) period, such an individual entrepreneur, according to ... determination of the residual value of fixed assets by individual entrepreneurs, is carried out according to the rules established by ... accounting "is not applicable to individual entrepreneurs. Firstly, individual entrepreneurs applying the simplified tax system, on ... the basis of the implementation of entrepreneurial activities by individual entrepreneurs and organizations, manifest themselves and ...

    • Payment of insurance premiums by individual entrepreneurs for 2020

      The amount and within what time frame an individual entrepreneur must pay insurance premiums for ... the amount and within what time frame an individual entrepreneur must pay insurance premiums for ... . 1 st. 430 of the Tax Code of the Russian Federation, an individual entrepreneur must pay in 2020 ..., the maximum amount of insurance premiums for an individual entrepreneur will be 268,010 rubles ...

    • Individual entrepreneurs - "simplifiers" and courts against the FIU

      Year. This case affects all individual entrepreneurs applying the simplified taxation system, since it is fundamentally ... compulsory pension insurance payable by an individual entrepreneur who pays personal income tax and does not produce ... paid for compulsory pension insurance by individual entrepreneurs for themselves, the base must be calculated ... insurance premiums paid to the FIU. Individual entrepreneurs applying the USNO with the object of taxation ...

    • Review of letters from the Ministry of Finance of the Russian Federation for July 2019

      A person who is not an individual entrepreneur, services from a foreign individual entrepreneur, the obligation to calculate and pay ... if land plots are acquired by an individual entrepreneur in order to carry out entrepreneurial activities ... piercing. In this regard, an individual entrepreneur carrying out the specified entrepreneurial activity ... of electrical wiring in apartment buildings, an individual entrepreneur has the right to apply the patent system ...

    • Review of legal positions on taxation issues reflected in the judicial acts of the Constitutional Court and the Supreme Court of the Russian Federation in the IV quarter. 2019

      Secondly, the debt is registered with individual entrepreneurs, lawyers, notaries engaged in private practice ... write-offs of the corresponding amounts have lost the status of an individual entrepreneur or lawyer or have ceased to engage in ...) taxpayers - individuals who are not individual entrepreneurs, pay tax no later than 1 ... activity without registration as an individual entrepreneur, since the income he received ...

    • Review of letters from the Ministry of Finance of the Russian Federation for November 2019

      If an individual with the status of an individual entrepreneur simultaneously performs labor duties ... of persons and (or) individual entrepreneurs. If an individual entrepreneur has a patent for repair, cleaning ... the specified patent. In the event that an individual entrepreneur, in addition to entrepreneurial activity, specified in ... a different taxation regime. Accounting for expenses by an individual entrepreneur using PSN, in particular, the obligation ...

    • Review of letters from the Ministry of Finance of the Russian Federation for December 2019

      07-14/93614 The sale of property by individual entrepreneurs recognized as taxpayers of the value added tax ... of metals transferred free of charge to organizations and individual entrepreneurs does not calculate VAT. In the case of ... other entrepreneurial activities as an individual entrepreneur, such a payer pays insurance premiums ... of legal entities or other individual entrepreneurs when applying the PSN by an individual entrepreneur by type of entrepreneurial ...

    • Review of letters from the Ministry of Finance of the Russian Federation for September 2019

      More than 150 square meters, an individual entrepreneur has the right to apply a simplified taxation system ... the cost of goods produced by individual entrepreneurs who subsequently terminated the status of an individual entrepreneur and ended their management ... more than 150 square meters, an individual entrepreneur has the right to apply a simplified taxation system ... an individual , which is not an individual entrepreneur, cash register equipment is used by the insurer ...

The status of an individual entrepreneur is determined at the legislative level in accordance with the form of management. He gives the individual entrepreneur rights and obligations that must be adhered to without fail. Every businessman should know about this parameter.

Status determination

Starting economic activity, subjects inevitably face a choice: to give preference to one or another organizational and legal form of business processes. In order to make the right choice and take the most advantageous position in the way of doing business, it is necessary to carefully consider all the positive and negative aspects that are characteristic of the existing organizational and legal forms.

The civil law status of an individual entrepreneur is defined in two ways, since the considered form of business operations includes features belonging to different persons. We are talking about both individuals and business entities of a legal entity.

There are a number of documents that determine the position of the IP. In accordance with the Civil Code of the Russian Federation, it is possible to identify a list of entities related to individuals and engaged in entrepreneurial activities. Individual entrepreneurs include citizens who carry out entrepreneurial activities, while creating a legal entity is not required. After reviewing the Civil Code of the Russian Federation, it becomes clear that, by law, individual entrepreneurs are not included in legal entities. However, it is wrong to rank them as individuals.

The most correct option in determining the legal status of an individual entrepreneur is to classify him as a separate group of individuals who are not classified as legal entities. But in connection with the conduct of economic activities for commercial purposes, they are endowed with specific powers that apply to the sphere of entrepreneurship. Outside this area, individual entrepreneurs are ordinary citizens of the state with the status of an individual.

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Specific Features

The legal status of an individual entrepreneur, from a legal point of view, is determined by the peculiarities of origin. An individual entrepreneur is recognized as a participant in economic processes, as he carries out activities of an entrepreneurial nature. The formation of a business entity as such is not carried out.

This duality determines the rights that accompany obtaining the status of an individual entrepreneur, especially the right to receive commercial benefits.

Individual entrepreneurs can only engage in a limited list of activities. It is determined by the relevant state authorities and excludes, for example, the possibility of selling alcoholic beverages or selling services related to security activities.

Therefore, before the IP registration procedure, each business entity needs to carefully read the list of prohibited types of manipulations that imply the need to open a limited liability company. Restrictions are associated with the tax policy pursued by the state government, therefore, a thorough check of the actual activity of the subject is carried out.

Obtaining the status of an individual entrepreneur does not mean that the property belonging to the subject will be divided into categories (participating in entrepreneurship and not). In this situation, both pluses and minuses can be identified. For example, it is possible to use a previously acquired item of property for the purpose of making a profit in the course of a commercial activity.

However, the negative side is that all property can be seized if the individual entrepreneur has unfulfilled obligations to creditors.

In this case, the property of the IP will be transferred as a payment of debt, while no records are kept of property that was or was not involved in the process of activity.

Among the obligations of individual entrepreneurs, they highlight the need to make timely payment of tax payments, the amount of which is calculated according to the form. It should be borne in mind that mandatory payments include amounts sent to the Pension Fund. In many regions of Russia, individual entrepreneurs have a special position, which is reinforced by the support of representatives of local governments. This manifests itself in the form of benefits provided for by law. Such measures are carried out by the state for the development of small businesses.

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Positive sides

After the documents confirming the status of an individual entrepreneur are drawn up, the entrepreneur has special rights and obligations. The most important right is that an individual entrepreneur has the opportunity to carry out activities for the purpose of making a profit.

An individual entrepreneur with a civil law status is exempted from the obligation to make tax payments (they are charged on the amount of income received by individuals). To register a legal status, a number of necessary documents are collected, their number is minimal. The costs associated with the relevant registration are somewhat less than for other forms of law.

For individual entrepreneurs, fines are provided for violation of the provisions defined at the legislative level. However, their size is significantly less than the amount of fines that legal entities have to pay. When creating an IP, each business entity needs to issue an account with which non-cash transactions will be carried out.

Legal entities have the opportunity to dispose of profits at their discretion. Unlike individual entrepreneurs, persons registered as a limited liability company must wait until the distribution of profits in order to take advantage of the results of the activity.

The advantage of the status of an individual entrepreneur is that he has the right to use his property in a simplified manner. An individual acting as an entrepreneur and his family have the right to use all property without restrictions, even if it is involved in the implementation of commercial activities. This provision is valid until the loss of the status of an individual entrepreneur occurs.

Individual entrepreneurs have the ability to carry out combined activities related to entrepreneurship, other types of non-commercial activities.