Individual entrepreneurs are the same full-fledged participants in the construction market as legal entities. The legal status of individual entrepreneurs in relation to self-regulatory organizations operating in the field of construction is practically no different from LLCs or other organizational and legal forms of legal entities.

The logical consequence of this is a positive answer to the pressing question of whether an individual entrepreneur can obtain an SRO for construction, design or survey.

In other words, individual entrepreneurs are subject to the same rules of operation of self-regulatory organizations as legal entities. They are established by the provisions of No. 315-FZ, supplemented by No. 372-FZ, which came into force in mid-2017.

New rules for the participation of individual entrepreneurs in the work of SROs, established by No. 372-FZ

No. 372-FZ, signed by the President in mid-2016, which came into force almost a year after that, seriously changed the rules of work of self-regulatory organizations operating in the construction industry.

Innovations affected almost all market participants: both in terms of types of activities - builders, designers and prospectors, and the legal form of business entities - LLC, individual entrepreneur, etc.

As a result, the conditions for entry and membership in an SRO for individual entrepreneurs have changed quite a lot.

Among the most important adjustments to the legislation on self-regulatory organizations introduced by No. 372-FZ are the following:

• cancellation of Certificates of admission of SROs to perform certain types of work in construction, design and survey;

a fundamental change in the conditions and requirements that determine the need for membership in an SRO, both for individual entrepreneurs and LLCs;

the introduction of a regional principle in the formation of construction self-regulatory organizations, which has not yet affected designers and surveyors;

creation of two types of compensation funds. The funds of the first of them are intended for possible compensation for damage caused by the SRO participant, and the resources of the second can be used to ensure that the SRO members fulfill their contractual obligations in the field of competitive procurement;

change in the amount of contributions to compensation funds. This innovation affected mainly large market participants, which individual entrepreneurs rarely become.

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The need to join an SRO for individual entrepreneurs

A characteristic feature of the amendments introduced by No. 372-FZ is that a significant part of small participants in the construction market, working with small volumes or on subcontract terms, are exempt from the need to compulsorily join a self-regulatory organization.

This circumstance directly concerns the majority of individual entrepreneurs belonging to this category. Today, membership in an SRO is mandatory for individual entrepreneurs only in one of the following situations:

• concluding direct contracts for construction, design or engineering surveys with technical customers, developers, regional operators of various federal programs, as well as organizations operating buildings and structures;

carrying out survey work on land plots owned by the state or municipality (for individual entrepreneurs who are members of the SRO of prospectors);

work as an individual entrepreneur in the status of a developer while independently performing design and construction work (for entrepreneurs who are members of an SRO of builders or designers);

signing and subsequent implementation of a contract in the amount of 3 million rubles (for individual entrepreneurs working in construction).

The above conditions, under which it becomes necessary for an individual entrepreneur to join the corresponding SRO, were introduced by No. 372-FZ. They allow a large number of individual entrepreneurs working under subcontracts or under contracts not exceeding 3 million rubles not to join self-regulatory organizations. Of course, this is one of the most important advantages of the reform of SRO activities in construction.

Requirements for individual entrepreneurs to join an SRO

A positive answer to the question whether an individual entrepreneur can receive an SRO in the field of construction depends entirely on whether the individual entrepreneur meets the requirements of legislation and the rules of a self-regulatory organization or not. They can be divided into three categories - financial, qualification and insurance.

Financial requirements for individual entrepreneurs to join an SRO

To obtain membership in an SRO, an individual entrepreneur must prove that he has sufficient financial resources to bear the following expenses:

• entrance fee. Its size is determined by the internal rules of the SRO, and in some professional associations there is simply no payment upon entry;

regular payment for participation in SRO. The frequency of such payments is established by the self-regulatory organization itself. Typically, monthly or quarterly installments are used;

contributions to compensation funds (CF) of a self-regulatory organization. The most serious type of financial requirements for SRO participants, including those who are individual entrepreneurs. For example, the minimum contribution to the CF for compensation for damage to a construction SRO is 100 thousand rubles. If you want to participate in competitive procurement, you will have to make another payment in the amount of at least 200 thousand rubles. These funds are sent to the CF to ensure contractual obligations.

Qualification requirements for individual entrepreneurs

To join the SRO of builders, designers or surveyors, an individual entrepreneur must have a higher education in a specialty appropriate to the type of upcoming activity. In addition, another mandatory requirement is work experience in one of the specified professions, which is at least 5 years.

At the same time, for membership in an SRO, an individual entrepreneur does not require the presence of 2 specialists included in the National Register among the employees. This is one of the few differences in the requirements for individual entrepreneurs compared to legal entities. However, SRO rules may include this condition as mandatory.

Requirements related to liability insurance

Many self-regulatory organizations include liability insurance as a mandatory requirement for joining the association, regardless of the status of the potential member.

In the previous version of the legislation, the conclusion of an insurance contract, although it was not mandatory from a legal point of view, in fact, an insurance policy was always issued, since this made it possible to significantly reduce the amount of the minimum contribution to the SRO comp fund. In general, a similar situation continued after the introduction of No. 372-FZ, so the clause on obtaining insurance is still included in the rules of most self-regulatory organizations operating today.

List of documentation required for individual entrepreneurs to join the SRO

When answering the question of how an individual entrepreneur can join an SRO, one should not forget about the package of documentation that a potential member of a professional association must prepare and provide. It includes:

• an application for joining the SRO, as well as an information sheet indicating the size of the contracts that the individual entrepreneur plans to conclude;

passport, as a document confirming the identity and place of registration of the entrepreneur;

individual entrepreneur registration documents, including registration certificates;

documents that confirm compliance with the qualification requirements imposed by No. 372-FZ and the rules of the SRO. They can apply both to the individual entrepreneur himself (required) and to the specialists working for him (if necessary);

documents on liability insurance, availability of the required material and technical base, financial capabilities to pay premiums, etc.

The last item of the given list of individual entrepreneurs submitted for joining the SRO of builders, designers or document surveyors is necessary if such a requirement is established by the rules of a self-regulatory organization. Federal legislation does not consider these documents mandatory.

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According to the first part of the Civil Code, all citizens of the country can conduct business activities without forming a legal entity. Since January 1, 2010, licenses are not issued for construction activities, but to carry out work, membership in an SRO (self-regulatory organization) is required. That is, an individual entrepreneur can, on the same basis as legal entities, engage in activities in the field of construction. To do this, you must obtain permission from the SRO of builders to carry out work.

The SRO issues a certificate to carry out work once, but it must be renewed every year. The state only regulates the procedure for creating a self-regulatory organization, exercises control and supervision. And the entrepreneurs themselves are responsible for the quality of design and safety. The SRO also has compensation funds, from which a fine is paid in case of damage.

Guided by the Town Planning Code of Russia (Article 55.8), individual entrepreneur or legal entity. a person can carry out work that affects capital objects. construction. To do this, you need a SRO certificate, which contains a list of acceptable works.

Order No. 624 of the Ministry of Regional Development (December 30, 2009) defines the following types of work that require SRO approval:

• Work in the field of engineering and geodetic surveys.
• Study of the condition of the foundations of structures and buildings, soils.
• Installation or construction of mine structures.
• Preparation of land planning schemes.
• Inspection of building structures, structures and buildings.
• Work in the field of engineering and geotechnical surveys.
• Commissioning works.
• Work in the field of engineering and environmental surveys.
• Installation or construction of tram and railway tracks.
• Construction of subways and tunnels.
• Construction of overpasses, bridges and overpasses.
• Diving work, hydraulic engineering work.
• Work in the field of engineering and hydrometeorological surveys.
• Construction or installation of airfields and highways.

The entire list can be found on the SRO website or in Order N624 of the Ministry of Development dated December 30, 2009 (as amended on November 14, 2011).

Certificate and membership in a self-regulatory organization is not required if:

• A garage is being built on a plot of land provided by an individual. person for his own purposes (in this case, the individual will not conduct business activities on it). Or on a plot for summer cottage farming and gardening.
• Reconstruction or construction of objects that are not capital objects is being carried out. construction (sheds, kiosks, etc.).
• Auxiliary structures are being built.
• Objects are repaired if the design characteristics that are responsible for reliability and safety are not affected.

Consequently, an individual entrepreneur can engage in a fairly wide range of work in construction.

Professional construction and renovation of houses and apartments is a system of sequential operations to create or restore the functionality of residential premises. The prospects for activity in this area are due to the high demand for relatively inexpensive, but high-quality construction and finishing work. At the same time, the availability of new technologies and good materials makes it possible to start your own business with a small amount of start-up capital, which explains the interest of businessmen in the possibility of opening individual entrepreneurs in construction and repair.

Individual entrepreneur or LLC: which is better to choose

Beginning entrepreneurs often wonder whether an individual entrepreneur can engage in construction and repairs, or whether for business in this area it is necessary to choose another form of business - an LLC. From the perspective of Russian legislation, both forms of entrepreneurship are acceptable, and the choice depends only on the point of view of the person concerned.

In order to decide between an individual entrepreneur and an LLC, you need to understand the pros and cons of these forms of entrepreneurship. It is easier to open an individual entrepreneur, and the entrepreneur manages the income from his activities independently. On the other hand, an individual entrepreneur cannot be sold; it is run only independently and is liable for debts with all its property.

An LLC can be bought or sold, and the liability of its members is proportional to their contributions. However, registration costs are high, and the LLC pays much more taxes.

Both forms of management may be preferable in different situations. Experts say that if an entrepreneur initially does not see much of a difference, it is better and easier to open an individual entrepreneur.

Registration of individual entrepreneurs for construction

Today, registering an individual entrepreneur for construction is a fairly simple procedure, consisting of several interrelated stages:

1. Selection of OKVED corresponding to construction and repair.
2. Choice of taxation regime.
3. Payment of state duty.
4. Submitting a package of documents to the tax office.

The procedure takes from 3 to 5 days, and the exact date of receipt of registration papers is usually indicated in the receipt. After the specified period, the new individual entrepreneur must receive a certificate of tax registration and a record sheet of the Unified State Register of Individual Entrepreneurs in form No. P60009.

Selecting OKVED

The first step in opening an individual entrepreneurship is to select codes for the economic activity that the businessman plans to engage in in the future. Codes are chosen according to the all-Russian classifier: since 2017, only one version has been in force - OKVED-2.

The classification of entrepreneurship according to OKVED is not affected by the size of the initial capital, the form of ownership, or the taxation system. All that matters is the intended activity.

When creating an individual entrepreneur, the OKVED code must be indicated in the registration application.

OKVED consists of 17 sections (from A to Q), which describe all types of activities performed by entrepreneurs. Construction and repair corresponds to section F. This group includes major and current repairs, as well as new construction; and does not include activities in urban planning, architecture and building design.

Set of OKVED codes “Repair and finishing of turnkey apartments”

The activities of individual entrepreneurs in the field of construction and repair mainly consist of repairs and turnkey finishing of premises. The main code for this activity is OKVED 45.45, which characterizes finishing and finishing work.

Individual entrepreneurs can also use additional codes:

• 45.31 – electrical installation work;
• 45.32 – insulation work;
• 45.33 – sanitary and technical work;
• 45.42 – carpentry and carpentry work;
• 45.43 – floor coverings and wall cladding;
• 45.44 – painting and glass work.

An individual entrepreneur has the right to choose several OKVED codes, but the main one must be one. More details about the codes and their groups can be found in the electronic version of the classifier.

Package of documents

In order to register an individual entrepreneur, a citizen of the Russian Federation will need only three documents:

• photocopy of civil passport;
• receipt of payment of state duty;
• application for opening an individual entrepreneur, drawn up according to the current model (P21001).

You can download a sample application on the tax service website.

If a business is registered with the help of an intermediary, then such a representative must present a power of attorney, as well as a document confirming his identity. A foreigner who wants to open a business in Russia must have a residence permit in the Russian Federation (TRP, residence permit).

Choosing a tax system

The choice of taxation system is a particularly important issue for individual entrepreneurs, since this determines how often it will be necessary to submit reports and how much contributions to pay. There are four systems in use in the construction industry:

• general (OSNO);
• simplified (USN);
• patent (PSN);
• unified tax on imputed income (UTII).

Let's look at their characteristics:

1. OSNO is optimal for large entrepreneurs and for those who need VAT, but it is unprofitable at the beginning of doing business.
2. The simplified tax system is most common among beginner entrepreneurs. It is convenient because instead of 3 general taxes you only need to pay one.
3. PSN applies only to individual entrepreneurs, allowing them to acquire a patent for activities for a period of one month to a year and not pay other taxes during this period.
4. When paying UTII, it does not matter how much income the individual entrepreneur received. Tax is charged only on the amount established by law.

Let us note that of all the listed taxation regimes, experts advise beginning businessmen to choose the simplified one. If desired, the tax regime can be changed later.

Options for registration of individual entrepreneurs

There are several ways to register an individual entrepreneur in the field of construction, repair or any other:

• on one's own;
• online;
• with the help of intermediaries.

The registration period for an individual entrepreneur usually takes no more than 3 days from the moment the necessary papers are submitted to the tax service. It is impossible to reduce this period, regardless of the method of registering the business.

Independent registration of individual entrepreneurs

Setting up a new business on your own is considered optimal because it does not require large expenses and allows a novice entrepreneur to understand the specifics of interaction with authorities. In this case, the citizen simply needs to take the package of documents described above to the tax office.

The process of personal registration is completed by receiving the necessary tax certificates from the same tax office.

Registration of individual entrepreneurs online

Today you can even register an individual entrepreneur remotely. The website of the Federal Tax Service of the Russian Federation helps with this, offering businessmen to go through the entire procedure online. A package of documents is literally generated automatically: in the appropriate tabs you need to enter your passport details, TIN, and also fill out an application for registration of an individual entrepreneur. Moreover, you can also pay the state fee remotely – for example, from a mobile phone.

This method of registering a business is suitable for confident PC users who value their time and do not want to waste it in line.

Registration through intermediaries

There is a third option for starting an individual business - through intermediaries. The advantage of this method is that it saves the citizen’s time, but this option is significantly more expensive. In addition to the state fee, you need to pay for the services of the intermediary himself and the notary, who will draw up a power of attorney for him.

The main task of an individual entrepreneur during such registration is to transfer his documents to an intermediary (often they are multifunctional centers). The intermediary will do the rest himself.

How much does it cost to open a sole proprietorship?

The cost of opening an individual entrepreneur varies depending on the registration method. The first two are the cheapest for an entrepreneur: in the case of self-registration or online registration, the only fee is a state fee of 800 rubles.

Registration of an individual entrepreneur through intermediaries will cost several thousand more: notary services (500-1000 rubles) plus additional expenses.

Who should become a member of the SRO

At the moment, there are no restrictions on individual entrepreneurs in construction, and all actions can be performed without obtaining a special license - it was abolished in 2010. Today, construction licensing has been replaced by the approval of a self-regulatory organization (SRO).

The SRO permit is issued for an indefinite period and requires quite large financial costs.

Individual entrepreneurs need to pay one-time compensation and entrance fees, buy an insurance policy if necessary, and also pay monthly membership fees.

Only some types of construction and repair work do not oblige individual entrepreneurs to join the organization. These works include:

• plasterboard finishing;
• plastering;
• excavation;
• painting and tiling works;
• Maintenance.

All other types of activities in this area require the individual entrepreneur to join a self-regulatory organization. Without permission from the SRO, the activities of an individual entrepreneur will not be legal.

Individual entrepreneur reporting in construction

Individual entrepreneurs in the construction industry must submit two types of reports:

1. Reporting of the individual entrepreneur himself. It includes data on the average number of employees, as well as reports and taxes to extra-budgetary funds and the Pension Fund.
2. Reporting submitted by individual entrepreneurs for their employees. It consists of reports to the Social Insurance Fund, the Pension Fund, as well as a report on personal income tax.

According to the law, individual entrepreneurs have 30 days to submit a quarterly report and 100 days to prepare an annual report. Before submitting reports to the tax office, they must be carefully checked to avoid problems and sanctions.

Registering an individual entrepreneur in 7 steps: Video

SRO (self-regulatory organization) is an association of individual entrepreneurs and legal entities engaged in the same line of activity or with similar professional characteristics. The state, having formed such organizations, transferred part of its own functionality to them, namely, control and supervision over certain categories of work. In other words, government agencies evaluate only the final result. SROs unite engineers, designers, and construction workers. Joining an SRO for individual entrepreneurs in construction is a mandatory procedure. What is needed for this, and what benefits does an entrepreneur receive when he becomes a member of an SRO.

An individual entrepreneur can work in construction on an equal basis with legal entities.

How to open an individual entrepreneur for construction work in 2019 is presented in step-by-step instructions:

1. Select OKVED. The selection is made from the all-Russian classifier OKVED-2, which has been in effect since 2017. The main goal of this stage is to determine a specific direction of activity. The code must be indicated in the registration application. The construction direction corresponds to section F of the Classifier. The section includes different areas of repair (major and current), new construction. Urban planning, architecture and design are not included in this section. The entrepreneur chooses only one main OKVED and an unlimited number of additional ones. The choice of the latter does not mean that the individual entrepreneur will necessarily work in these directions.
2. Choosing a form of taxation. For individual entrepreneurs and organizations in the construction industry, there are 4 modes: OSNO, simplified tax system, UTII, PSN. In the future, you can switch to a different taxation regime by writing a corresponding application.
3. Payment of state duty - 800 rubles.
4. Transfer of documents to the Federal Tax Service. Only 3 documents are required: a passport, a receipt confirming the fact of payment of the duty, an application for registration of form P21001.

The most popular OKVED standards among individual entrepreneurs working in the construction industry:

• 45.31 - electrical installation work;
• 45.32 - insulation work;
• 45.33 - sanitary and technical work;
• 45.42 - carpentry and carpentry work;
• 45.43 - floor coverings and wall cladding;
• 45.44 - painting and glass work.

Registration is considered completed after making an entry in the Unified State Register of Entrepreneurs. The procedure takes 3-5 days. It is worth noting that an entrepreneur can not only personally apply to the Federal Tax Service for registration, but also draw up a power of attorney certified by a notary for the representative. In addition, online registration is available. However, preparation for running a construction business does not end there; individual entrepreneurs need permission from the SRO.

If, upon registration, an individual entrepreneur does not submit an application for transition to one of the special tax regimes, then OSNO will automatically be applied. Permission to use a special regime is not required; the application is of a notification nature.

Currently, there are no restrictions on the activities of individual entrepreneurs in the construction industry. The business is conducted without obtaining special licenses, which were abolished in 2010. A replacement for licensing is the SRO certificate. Such a document is issued for an unlimited period and is associated with significant financial costs.

However, participants in self-regulatory organizations receive a number of advantages:

It is worth noting that an entrepreneur may lose membership in a self-regulatory organization. As a rule, there are 3 main reasons for this: causing damage to third parties, non-payment of membership fees, and carrying out work without the appropriate permits.

Obtaining SRO approval for an individual entrepreneur to design or perform construction work requires the provision of constituent documents, as well as information about resources (both labor and property). Joining an SRO for individual entrepreneurs also requires payment of a compensation and entrance fee, and then a monthly membership fee. Also, some self-regulatory organizations require purchasing an insurance policy.

There are a number of construction and repair works that do not require entrepreneurs to join an SRO.

These include:

• plastering, painting, facing and excavation work;
• Maintenance;
• plasterboard finishing.

All other areas of the construction business require membership in a self-regulatory organization.

First of all, the activities of the SRO are aimed at monitoring the contractors attracted by the developer. If, during the construction of real estate, the developer engages a third party to organize work on the basis of a general contract, then the approval of the SRO is required for the general contractor. If the developer independently searches for contractors, then he needs to obtain SRO approval.

Obtaining a certificate of admission to perform construction work is preceded by the provision of a set of documents according to the approved list. It is worth noting that the list for obtaining an SRO certificate for individual entrepreneurs in construction and repair can vary significantly depending on the specific organization, as well as the type of SRO.

However, the request from the SRO may not be limited to the standard requirements for the set of documents; the legislation allows for the establishment of additional requirements, which means the set will be expanded.

To obtain admission from most SROs, individual entrepreneurs will need to provide the following documents:

1. OGRNIP certificate with attached certificates or extracts from the Unified State Register of Individual Entrepreneurs on registration of changes. It is enough to provide copies. The entrepreneur himself can assure.
2. A copy of the TIN certified by the entrepreneur.
3. A copy of the notice of registration with the tax authorities certified by the entrepreneur.
4. Statistics codes (a copy of the original or a “fresh” extract from the Rosstat website).
5. An extract from the Unified State Register of Individual Entrepreneurs, which was issued no earlier than 30 days before the date of submission of documents.
6. Passport. The copy is certified by the individual entrepreneur.
7. Information about the qualifications of the individual entrepreneur, as well as employees of the candidate for SRO participants (for example, copies of diplomas, work books, showing work experience in the construction industry of 3 years or more, certified by the individual entrepreneur, documents on advanced training).
8. A free-form list of property required to perform the stated work. It is important to indicate not only the name, but also to make notes whether the equipment is owned or rented.
9. Copies of current licenses or SRO certificates.
10. In a text file: bank details, contact information (telephone, email address, date and place of birth of the entrepreneur, link to the website).
11. The indicated types and subtypes of activities from the SRO classifier that the entrepreneur plans to engage in. The price of document preparation is calculated based on the number of selected types. It is important to note the types and subtypes of activity.

An individual entrepreneur can engage in construction only after passing the inspection procedure. Obtaining SRO approval is required only for those works on the preparation of project documentation that have an impact on ensuring the safety of capital construction. The situation is somewhat different with design, the main stage of construction, the quality of which determines not only the comfort of using the facility and its service life, but also safety. However, the contribution to the designers' compensation fund is 2 times lower than the contribution to the SROS. There are also no requirements for material and technical equipment. Instead, the requirements for personnel qualifications are as strict as possible. Thus, there is a requirement for the number of employees who have a specialized higher education (at least 3), as well as requirements for minimum experience in the profession (from 5 years). In addition, it is necessary to undergo advanced training every 5 years. The main difference in the sets of documents for builders and designers is that the latter have an ISO certificate (for the design of technically complex objects, as well as dangerous and non-standard ones).

Some SROs require all candidates to have third party liability insurance.

The higher the SRO status, the greater the requirements for candidates. Full information about the required documents can be obtained by requesting a commercial offer by email.

Activities in the construction business of individual entrepreneurs require the submission of two types of reports:

• according to the chosen taxation regime. The composition depends on the selected mode. The most complete reporting is required for entrepreneurs using the main form of taxation. The simplified tax system and UTII provide for simplified accounting and filing a tax return. The patent does not provide for the filing of a declaration, but requires the maintenance of KUDiR;
• reporting to extra-budgetary funds, Pension Fund. Implies the following types of reports: on the average number of employees, reports to the Pension Fund of the Russian Federation and the Social Insurance Fund, and a report on personal income tax.

According to legislative norms, an entrepreneur is given 30 days to prepare a quarterly report and 100 for an annual report. One of the most common primary documents for entrepreneurs in this area is a contract for construction work performed by individual entrepreneurs. This agreement gives the right to deduct possible expenses from income. It is important for entrepreneurs to draw up a contract correctly in order to avoid legal and other financial costs in the future. The main distinguishing feature of such an agreement is the obligation of the customer to organize conditions for the contractor to perform the work. Acceptance of the results of work is carried out according to the act; if there are disagreements, it is also necessary to draw up a corresponding document.

Individual entrepreneurs must timely submit reports and pay tax payments. Failure to comply with these legal requirements may result in penalties.

Thus, the obligation to join an SRO has significantly improved the quality of construction services due to high requirements for members. SROs develop regularly and fruitfully. Therefore, despite the need to pay membership fees and impressive requirements for a set of documents, the participating entrepreneur receives significant benefits.

If an entrepreneur decides to organize a construction business, he is faced with the question: what should be the taxation system for individual entrepreneurs during construction? It is important for every businessman starting his own business to decide which system he will use to make payments, because the complexity of tax and accounting, as well as the type of payments he needs to make to the budget, depends on this choice.

A single tax on imputed income

All individuals engaged in entrepreneurial activities are required to submit reports to the Federal Tax Service and pay taxes on time and within the established deadlines. This scheme for making payments to the state greatly simplifies the life of entrepreneurs. But there is one pitfall: this type of payment can only be used for certain types of activities, a list of which is contained in the Tax Code of the Russian Federation. When considering the scheme for paying UTII, an entrepreneur needs to determine whether he should make these payments from his type of activity, since now the UTII regime for certain types of business is mandatory.

This taxation system for individual entrepreneurs (construction) can also be applied to activities such as the provision of household services to the population. Household services may include the repair and construction of housing and other buildings, excluding the construction of private houses. Thus, if an individual entrepreneur is engaged in providing repair and construction services to the population and if in the territory where he carries out this activity, UTII has been introduced for this type of activity, then the individual entrepreneur is obliged to pay UTII.

If an individual entrepreneur carries out, along with those types of work that are subject to UTII, other activities, he will pay taxes and fees in accordance with the taxation scheme that he has chosen for this type of activity. If an individual entrepreneur is not subject to mandatory taxation under the UTII scheme, he has the right to choose any other system for making payments to the budget.

A significant advantage of this type of payments to the budget is that their amount is always fixed and does not depend on the actual income of the individual entrepreneur, and the amount of payments is determined by the scale of the business itself, for example, the number of employees or vehicles. This tax can be reduced by insurance premiums paid for employees. Sometimes due to this it is possible to reduce the tax amount by almost half.

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Simplified taxation system

This is the most common scheme found among beginning entrepreneurs. Using this scheme, a businessman pays only one tax instead of three, and it is paid once a quarter, and reports are submitted only once a year. An entrepreneur engaged in construction can switch to this taxation system on a voluntary basis, and he can combine it with UTII for those types of work that are subject to this type of payment without fail.

Individual entrepreneurs engaged in home repair and construction can also switch to a simplified taxation scheme based on a patent. But it is necessary to take into account that according to such a scheme regulating the taxation of construction individual entrepreneurs, a businessman can attract hired workers, the average number of whom for the reporting period does not exceed 5 people.

To choose this system, you need to submit an application to the Federal Tax Service no later than 30 days after registering an individual entrepreneur or before December 31 in order to switch to this scheme immediately after the next year. Please note that this system may not always be used. There are restrictions on certain types of businesses that cannot use it. In addition, there are restrictions on the maximum annual income and on some other factors.

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General tax regime

If an individual entrepreneur does not necessarily pay UTII and does not use a simplified system of payments to the budget, he must calculate the amount of payments and make them according to the general taxation regime. In this case, the individual entrepreneur pays personal income tax and VAT in accordance with established regulations.

If an individual entrepreneur has property for which contributions must be made to the state, he is obliged to pay:

• land payment;
• property tax for individuals;
• transport payment.

This mode is not always profitable, especially for entrepreneurs taking their first steps in business.

A businessman himself must keep full accounting records, create a book of income, expenses and business transactions.

For each payment to the budget it will be necessary to submit reports.

Most often, the main criterion for choosing or rejecting this scheme is VAT. Calculating it is not so easy; to do this, you will need to keep all documentation, all invoices in order and submit reports to the Federal Tax Service every quarter. Based on all this, if a businessman does not have good knowledge of accounting, he should think about other types of deductions to the budget.

If an individual entrepreneur engaged in construction activities has not decided which system to switch to and has not reported this to the Federal Tax Service, then he is automatically transferred to this system, that is, the general taxation regime is used by regulatory authorities by default. It operates without restrictions for all types of business. In this system there are no restrictions not only on types of activities, but also on the number of employees, income received, and so on.

Thus, each individual entrepreneur, who is an individual entrepreneur, chooses taxation for construction work based on the characteristics of his business and which system seems simpler and better for him in all respects. But whatever your choice, ideally completed tax reporting and timely payments to the state are the main step to business success.

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