Accounting and taxation of vouchers that are provided to the employees by the company depend on their funding and the form of provision. The company can reimburse the price of the voucherto theemployee or pay it directly to the sanatorium or rest home. Let’s examine in detail what to do with the vouchers that are provided to employees at the expense of the company.
Accounting
The company purchases vouchers and accounts them at the sub-account 331 “Money documents in national currency”. Their income should be reflected in the accounting by deducted: debit of subaccount 331 with credit of subaccount 685 “Settlements with other creditors”.
When the vouchers were given to employees, their cost should be written off for expenses. Depending on the department where the employee works, such expenses are recorded on accounts 23, 91, 92, 93 or subaccount 949.
PIT and the war tax
From the taxation of personal income tax (hereinafter − PIT), the granting of a voucher (in cash or non-monetary form) is either payment for labor (if the provision of vouchers is stipulated by a collective agreement), or the additional benefit of the individual recipient. Generally, additional benefits are included in the taxable income of the payer.
If the company compensates the cost of the voucher to the employee with money, we get the PIT simply by multiplying the cost of the voucher by 18%.
If the employer compensates the cost of the voucher to the sanatorium – this is a salary payment (additional benefit) in non-monetary form. In this case, we calculate the PIT with the use of a natural coefficient (paragraph 164.5 of the Tax Code of Ukraine, hereinafter − TCU). The natural coefficient is 1.2195 (100 ÷ (100 – 18)) at 18% rate.
Since the personal income tax and the war tax are taxed on the basis of the principle of “one object per two” (sub-para.1.2 of para.16-1 of sub-sec.10 of sec. XX of TCU), it should be accrued the war tax on voucher at the expense of the employer. The war tax rate is 1.5%. When determining the war tax the natural coefficient should not be used for either monetary or non-monetary income.
It should be remembered that the employee’s income will be only a part of the voucher reimbursed by the company. That is, if the company paid (compensated) the voucher ticket to the employee, the employee’s income is the amount of the discount.
Depending on the determining of the voucher as a salary payment or an additional benefit, the cost of a free voucher from the employer should be reflected with a sign of income “101” or “126” in the tax calculation of the form No. 1DF. The amount of the accrued and paid income and the amount of the war tax withheld and paid should be reflected in the line “The war tax” of sec. II.
USC
The Unified Social Contribution (hereinafter – USC) should be accrued at the cost of a free voucher at the expense of the employer. After all, the base of accrual of the USC is the basic and additional wages, other incentive and compensatory payments, including in kind (sub-para.1 of para.1 of sec.1 of Art. 7 of the Law of Ukraine “On the collection and accounting of the unified contribution for mandatory state social insurance” of 08.07.2010 No. 2464-VI). The voucher to the employee and their family members for treatment and rest is a form of other incentive and compensation payments (sub-para. 2.3.4 of the Guidelines on wage statistics, approved by the order of the State Statistics Committee dated January 13, 2004 No. 5; hereinafter − Guidelines No. 5).
When filling in the Unified Social Contribution Report in Form No.F4, the vouchers from the employee should be considered as a part for the period.
VAT
The taxation of value added tax (hereinafter – VAT) of voucher transactions depends on the shape of their provision. If the company compensates the cost of the voucher in cash to the employee, the subject to VAT taxation does not arise.
If the company (VAT payer) purchases voucher directly from the sanatorium and then gives to the employee, during the purchase of voucher, it should be reflected the tax credit on VAT (para. 198.3 of TCU). Of course, in case of having registered a tax invoice in the Unified Register of Tax Invoices.
Instead, the free provision of voucher to an employee is considered to be the supply of services (sub-para. “в” of sub-para.14.1.185 of TCU). In this case, the tax base of VAT is the purchase price of the voucher (para. 188.1 of TCU).
Consequently, tax liabilities on VAT should be reflected in the reporting period of the transfer of voucher to the employee, and tax invoices should be made:
- one – at the actual amount of delivery voucher to the employee – zero;
- the second one − at the price of the purchase of voucher;
or consolidated tax invoice at the purchase price of the ticket not later than the last day of the reporting period when voucher provided.
If the company provides voucher not free of charge, but with a discount, it should be made tax invoices:
- one − at the cost that the employee compensates;
- the second one – at the discount (the difference between the purchase price of the voucher and the amount that the employee compensated);
or consolidated tax invoice at the discount not later than the last day of the reporting period when voucher provided.
Provision of vouchers for sanatorium treatment, health improvement and rest on the territory of Ukraine of individuals under the age of 18, invalids and disabled children are exempt from VAT taxation (para 197.1.6 of TCU).
Income tax
The subject of taxation of income tax is the financial result before tax, determined in accordance with the rules of Accounting Standards or IFRS and adjusted for the difference. That is, the cost of vouchers provided free-of-charge to the employees affects the subject of taxation of income tax due to accounting expenses.
The TCU does not provide corrective differences on vouchers. Thus, taxpayers of the income tax of any profitability, providing travel vouchers to employees, when determining the income tax, the accounting result should not be adjusted.
