The law does not prohibit employers from setting wages in foreign currency, but wages can be paid in foreign currency only in strictly limited cases. In this article we will look at when it is possible to pay wages in foreign currency.

Who can receive a salary in foreign currency?

The employer, in accordance with labor legislation (131 Labor Code of the Russian Federation), has the right to set wages in Russian rubles or in any foreign currency. But he has the right to pay wages in foreign currency only in those cases provided for by Law 173-FZ of December 10, 2003. According to the law, persons who have the right to receive wages in foreign currency include:

• employees of Russian organizations with non-resident status;
• Russian employees working under an employment contract outside the Russian Federation, including representative offices and branches of Russian organizations, diplomatic missions, and consular offices.

Employment contract

Thus, the employer has the right to set wages in foreign currency, but only subject to conditions that exclude a reduction in wages when the exchange rate changes. In this case, the employer has the right to do the following:

1. Establish in the employment contract a fixed exchange rate, or an average rate at which wages will be paid. During the work, the exchange rate may be revised depending on the economic situation in the country.
2. The employment contract or the Regulations on remuneration may provide for the procedure for compensating the difference that arises in the amount of wages depending on currency exchange rate fluctuations.
3. Constantly keep records of fluctuations in foreign currency exchange rates, compiled in the form of a table and graph. Based on the results of such accounting, it is possible to compensate employees for the difference in wages.

Important! If the employment contract includes conditions that exclude reductions in the amount of employees’ wages depending on currency exchange rate fluctuations, then the following wording can be used:

1. “The employee is given a monthly salary of 1000 (One thousand) US dollars. In this case, the payment of wages to the employee is made in the equivalent amount in rubles at the rate of 60 (Sixty) rubles per 1 (One) US dollar. Due to the unstable economic situation, the specified exchange rate is subject to review and change once a quarter. These changes are formalized by an additional agreement to the employment contract.”
2. “The employee is given a monthly salary of 2,000 (two thousand) US dollars. In this case, the Employee’s wages are paid in an equivalent amount in rubles in accordance with the official exchange rate set by the Central Bank of the Russian Federation on the date of payment of wages. Within two weeks after the end of the next quarter, the Employer compares the Employee's total salary for such quarter with the total salary received by the Employee for the previous quarter. The resulting difference in the specified amounts is paid by the Employer to the Employee on the day of the next salary payment.”

Wages include all payments received by an employee for the work they perform (including salaries, allowances, bonuses, etc.) (129 Labor Code of the Russian Federation). The employer is required to transfer wages to the employee at least twice a month. Wherein Payment of wages should be made only in rubles, but this does not apply to the determination of remuneration. Thus, it is impossible to pay salaries in foreign currency, but they can assign them.

Payment of wages in foreign currency

Until recently, those employees who worked in Russian companies, but abroad, could only receive their salaries into an account opened in a Russian bank. However, on February 15, 2020, a law came into force that amended Art. 131 Labor Code of the Russian Federation. Now Russian companies have the right to transfer wages to their employees who work abroad in foreign currency. Thus, employees of Russian companies abroad have the right to receive their salaries in the currency of their country of residence, for example, in dollars or euros.

Since perestroika times, the words “currency”, “bucks”, “greens” have firmly entered our colloquial language. Thanks to the dominance of Hollywood films on Russian screens, it sometimes began to seem that that same overseas dollar was the same everyday means of payment as the usual ruble. Let’s be honest, in the post-perestroika years they actually often used foreign currency for cash payments: they paid for purchases, sometimes they gave out salaries (on a par with).

Today, the situation has changed radically, and it is no longer possible to freely use foreign banknotes within the country. Even if you really want to receive, for example, a salary in dollars or euros, this is only possible in a very limited number of cases. We will now look at them in more detail.

So, who can be paid for work within the framework of an employment relationship in foreign currency?

Regulatory regulation

First, let's look at the legal norms. To avoid making a mistake and getting into trouble with the law by paying someone in foreign currency, you need to study:

1. Labor Code, namely Article 131. Until recently, its wording allowed settlements with employees exclusively in rubles. Since 2018, the legislator has allowed a slight relaxation: sometimes it is still possible to pay wages in foreign currency, but in a list of cases limited by law.
2. This very list is given in the text of the Federal Law “On Currency Regulation and Currency Control”. This is the main regulatory document on this issue.
3. Have you decided whether it is possible to pay your employee in foreign banknotes? Don’t rush to relax and take a look at the Tax Code. After all, wages in the Russian Federation are subject to income tax, and its rate depends on who receives it: a tax resident or a non-resident.

When is such a payment possible?

The already mentioned Federal Law “On Currency Regulation” answers this question. But first, it’s worth understanding its basic concepts. The law distinguishes between two categories: residents and non-residents. Everything is simple here. The first include:

• all citizens of the Russian Federation;
• foreigners living in Russia with a residence permit.

Non-residents in the understanding of this law are all others: foreign companies, their diplomatic and consular institutions.

When calculating the salary of your employee located abroad in foreign currency, it is advisable to look at the Decree of the Ministry of Labor of the Russian Federation of August 20, 1992 No. 12, which regulates the procedure for such calculations. You can deposit your salary through the employee’s current foreign currency account and even in cash through the cash register.

As practice shows, regulatory authorities may have complaints about cash payments. However, the practice of higher courts suggests the opposite (for example, Resolution of the Supreme Arbitration Court of November 24, 2014 No. 310-AD14-928).

Taxation

Wages are among those incomes of individuals that are subject to income tax (). If you pay your salary in foreign currency, be prepared for some peculiarities in the field of taxation.

We have already talked a lot about residents and non-residents in the understanding of the Federal Law “On Currency Control...”. Tax legislation operates with the concepts of tax resident and non-resident.

Why is it important? The fact is that the income tax rate depends on who the payer is. If you do not take this point into account, you risk making a mistake in calculating the amount of tax and, as a result, getting into trouble with the fiscal authorities.

• So, who are tax residents: all “physicists” who have been in Russia for at least 183 days over 12 consecutive months. If during this time you left the country for a short time (up to six months) for medical treatment or to study, these periods are not taken into account.
• In addition, all military personnel and officials who were sent abroad on a business trip are always residents for the tax authorities, no matter how long they were there. Accordingly, all others are non-residents.

• all residents; They should calculate tax at a rate of 13%.
• non-residents who receive wages for working in the Russian Federation. Their rate is 30%. However, there are exceptions for some foreigners: for highly qualified specialists, for those working under a patent, for refugees and some others.

If an employee's rights are violated

When it comes to pay for work, it is difficult not to touch upon the topic of violations of workers' rights. It very often happens that they did not pay in full, but finally they paid.

These employers very often forget how harsh Russian laws are for such violators. And many workers don’t even know what exactly needs to be done in such cases.

Therefore, we have prepared a short reminder on this topic:

1. If your salary was delayed by more than 15 days, you... Suspend work, but be sure to notify your superiors in writing before doing so. During such suspension, you will retain. They have no right to fire you for such behavior, just document the situation correctly. You will have to prove the fact of delayed wages in court (if it comes to it).
2. You should know that for late wages your company must pay in rubles in the form of penalty interest (see Article 236 of the Labor Code). Calculating these percentages is simple: the amount of debt is multiplied by 1/150 of the key bank rate (since March 26, 2018 it is set at 7.25%) and by the number of days overdue. You also have .

Let's give an example: your employer owes you 10,000 rubles, you have been waiting for payment for 20 days (from the date the salary was issued in your organization). The amount of penalty interest will be: 10000*7.25%/150*20 = 96.67

As you can see, the amount of penalty interest is small, but by agreement with the employer you can increase it, stipulating this in the employment contract or in local regulations of the company or.

Please note that the law does not connect the obligation to pay such interest with the presence of management fault. In other words, even if you were not paid on time for objective reasons (no money, difficult financial situation), this does not negate the consequences for the employer in the form of paying interest.

But penalties alone for non-payment of wages will not get you off. For such violators, the law provides for administrative liability under Art. 5.27 clause 6 of the Code of Administrative Offenses in the form:

• warnings;
• fine (up to 20 thousand rubles for officials);
• disqualification (if your employer has committed similar violations in the past). To bring your bosses to justice, you should file a statement with the prosecutor's office or labor inspectorate, outlining the essence of the problem.

Finally, particularly “distinguished” wage debtors risk being brought to criminal liability (Article 145.1 of the Criminal Code of the Russian Federation). Sanctions include fines, forced labor and even imprisonment.

There is one “but”: both the administrative and criminal liability of the employer is determined by the presence of his guilt. Simply put, you can punish such a boss only if your payment was delayed not because of financial difficulties or lack of money, but for other reasons (greed, desire to save money, cheat, etc.).

So, despite the direct ban on paying employees for their labor in foreign currency, exceptions still exist. If you are one of the “chosen ones,” check all the details to avoid negative consequences.

The video below is dedicated to issuing daily allowances in foreign currency:

Issues related to remuneration are the most pressing in the practice of personnel management. And it’s not surprising: the amount of wages is a mandatory condition that you must indicate in the employment contract with the employee ( part two art. 57 Labor Code of the Russian Federation). However, the law does not tell us what exactly we need to pay attention to when prescribing it. How to indicate the terms of remuneration in a contract? Who can be assigned a salary in foreign currency? Will this be a violation and in what cases?

We indicate the terms of payment in the contract

As you know, wages include all payments that an employee receives for work performed (salary, bonuses, allowances, etc.) ( Art. 129 Labor Code of the Russian Federation). Salaries must be transferred to the employee at least twice a month ( Art. 136 Labor Code of the Russian Federation). However, it can only be paid in rubles ( part one art. 131 Labor Code of the Russian Federation). The law does not indicate that this requirement also applies to the determination of remuneration. Hence, It is forbidden to pay rather than assign wages in foreign currency. At the same time, the law identifies certain categories of workers whose work can be paid not in rubles (see diagram).

* Decree of the Government of the Russian Federation of December 26, 2005 No. 812.
** Article 19 of the Federal Law of July 19, 2011 No. 247-FZ.
*** Article 2 of the Federal Law of November 7, 2011 No. 306-FZ.

Mandatory clauses must be included in the employment contract with the employee - these are the terms of remuneration, which include, among other things, the amount of the tariff rate or salary (official salary) of the employee, bonuses and incentive payments ( Art. 57 Labor Code of the Russian Federation). In addition, write down additional payments if the employee is entitled to them, for example, an allowance for high professionalism or an academic degree. The employment contract must establish the days for payment of wages and the payment procedure ( Art. 136 Labor Code of the Russian Federation). As well as the conditions under which the employee’s wages can be paid by the employer at the cash desk or transferred to the bank account specified by the employee (see sample).

When discussing wages with an employee when hiring, focus his attention on the fact that the amount of wages in the employment contract is established before taxes are paid.

Why you can’t set salaries in foreign currency

Before 2006, many employers set employee salaries in dollars. At that time, foreign exchange was constantly increasing and thus the salaries of employees increased along with it. Therefore, the inspection authorities turned a blind eye to the fact that employers did not act in accordance with the law. When the foreign exchange rate began to fall, the interests of workers were violated. Then Rostrud began to actively fight against violators. Therefore, already in 2006, most employers revised their staffing schedules, indicated salaries in rubles and reflected these changes in other local acts and employment contracts.

Rostrud explained that wages for employees must be set according to the rules of the Labor Code (Article, Labor Code of the Russian Federation). If an organization determines payment in foreign currency, but pays it in rubles, then this may violate the rights of employees due to changes in exchange rates. In addition, when calculating wages, the employer must fill out unified forms for recording labor and its payment, in which amounts are indicated only in rubles.

This is another reason why charging wages in foreign currency is not recommended.

If an employer pays an employee a salary for the performance of the same job duties, the amount of which changes along with the exchange rate, he will also violate the requirements of the law (Article, Labor Code of the Russian Federation), which may lead to administrative liability ( Art. 5.27 Code of Administrative Offenses of the Russian Federation).

We regulate wages in a foreign company

Foreign companies and organizations with a large percentage of foreign capital often plan their activities and account for financial performance in the currencies of their countries. Therefore, they also initially calculate employee salaries not in rubles. It is also important for many foreign workers that the payment for their work activities is reflected in currency. This makes it easier for them to understand how much income they can get from their work.

Companies that denote income in foreign currency to their employees can set its internal rate, based on which employees will the difference arising due to exchange rate fluctuations is reimbursed. In this case, salaries are paid only in rubles ( Art. 131 Labor Code of the Russian Federation). To do this, a local regulatory act, for example the Regulation on Compensation, fixes the average exchange rate of the currency to the ruble for a certain period of time (for example, six months) and all payments that the employee receives (salary, payment for children’s education, rent, moving expenses, etc.) . p.), are calculated according to it. The course is then reviewed every six months and changed if necessary. To take into account currency fluctuations, it is convenient to maintain a monthly compensation table for each employee. In case of wage losses due to exchange rate differences, employees are paid quarterly.

Attention!

Salaries are prohibited from being paid:
in foreign currency; in booms;
in coupons; in receipts;
in the form of alcoholic beverages;
in the form of items that are prohibited or limited in free circulation (Article 131 of the Labor Code of the Russian Federation)

Example.

Steve K., an employee of a representative office of a Western company, is entitled to a salary of $1,000. When concluding an employment contract in Russia, his salary was set in rubles. At the same time, the local act of the organization provides for wage indexation, which is carried out every six months and depends on fluctuations in the dollar exchange rate.

Is it possible to pay salaries to foreigners in rubles?

The issuance of wages to foreign citizens in Russian rubles is a currency transaction (clause , , , , subparagraph. "b" clause 9, part 1, part art. 1 of Law No. 173-FZ). But at the same time, in Russia there is no ban on paying non-resident foreigners in Russian currency.

There are no special requirements or restrictions for performing this operation ( Art. 6 of Law No. 173FZ). Accordingly, an employer cannot be fined for violating currency laws by paying wages to foreigners in rubles ( Part 1 Art. 15.25 Code of Administrative Offenses of the Russian Federation).

Attention!

The transfer of wages in foreign currency is recognized as a foreign exchange transaction. Responsibility for this violation is provided for in Art. 15.25 Code of Administrative Offenses of the Russian Federation

What does the employer risk if the salary is set in foreign currency?

Expenses incurred by the employer to pay employees reduce the tax base for income tax ( Art. 255 Tax Code of the Russian Federation). It should be noted that for the purposes of this tax, any expenses must meet the requirements and be documented ( Art. 252 Tax Code of the Russian Federation). This means that the text of the employment order must comply with the provisions of the employment contract ( part one art. 68 Labor Code of the Russian Federation). And the primary documents for labor accounting and payment of wages, confirming expenses, are maintained in the established form (according to forms, approved Resolution of the State Statistics Committee of Russia No. 1). It is not possible to make corrections to forms approved by Goskomstat. Moreover, the Russian Ministry of Finance gave clarifications that since accounting in Russia is carried out in rubles (clause 1 art. 8 of Law No. 129-FZ), the indication in primary documents of salary in foreign currency or conventional units can be regarded as a violation, for which liability is established in the form of a fine in the amount of 10,000 rubles ( Part 1 Art. 120 Tax Code of the Russian Federation).

Remember the main thing

Note the experts who took part in the preparation of the material:

Maria OSETSKAYA,

State labor inspector of the State Labor Inspectorate in Moscow:

– Remuneration is one of the mandatory conditions of an employment contract. Include in the contract all the terms of remuneration: the amount of official salary, additional payments, allowances and bonuses, the method of payment of wages and the days of their issuance, indicate that it is paid in the currency of the Russian Federation.

It would seem that it’s so difficult?

The difficulty may arise not from non-resident workers, but from the organization. If an employer hires a non-resident, then he must offer him to open a bank account and then receive a card for transferring wages. If the employee refused to do this, and he was still hired, then the tax office, to which all control functions were transferred for the implementation of Federal Law No. 173-FZ “On Currency Regulation and Currency Control”, he may inadvertently check the organization. After all, payment of wages to foreigners in Russian currency is a foreign exchange transaction.

When checking compliance with this law, the inspectorate examines how many non-resident workers are working and finds out how their wages are paid. In the case of payment of wages through the cash desk of an enterprise, the organization may face liability under Part 1 of Article 15.25 of the Code of Administrative Offenses of the Russian Federation - the organization may face a substantial fine. The amount of the fine is calculated as three-quarters to one of the amount of the illegal currency transaction. A foreign exchange transaction involves payment on a certain day according to one payroll.

For example. The amount of wages paid was 450,000 rubles, the amount of the fine will be 337,500 rubles. (450,000 x 3/4 = 337,500 rub.)

If, of course, the fact that an administrative offense has been detected is obvious, then you can try to draw the attention of the tax inspector to other articles of the code of administrative offenses in order to try to mitigate the fate of the organization.

There are several options, one of which the tax authority may try to apply:

1. if the organization tries to prove the insignificance of the offense in the act, then the tax official can release the person from administrative liability and limit himself to an oral remark, applying Article 2.9 of the Code of Administrative Offenses of the Russian Federation;
2. if there is no insignificance in the current situation, the tax office can apply 4.1.1 of the Code of Administrative Offenses of the Russian Federation to the organization, which means a warning.

However, the organization must meet the following conditions:

• the organization belongs to small and medium-sized businesses;
• the organization has not previously been prosecuted for a similar administrative offense.

If these options cannot be applied to save the organization, then the last thing that remains is to “call” the inspector to apply Article 4.1 of the Code of Administrative Offenses of the Russian Federation. Since Article 4.1 of the Code of Administrative Offenses of the Russian Federation stipulates the general rules for imposing administrative punishment, which take into account circumstances related to the nature of the administrative offense committed, the property and financial situation of the person involved, etc. That is, when calculating the total amount of the fine, a tax official can reduce the amount, but not less than half the minimum amount. For your information, according to clause 3.2 of Article 4.1 of the Code of Administrative Offenses of the Russian Federation, the minimum amount for legal entities is at least 100,000 rubles.

Source Telegram channel