An individual (aka individual entrepreneur) leases premises to an LLC as an individual. QUESTION: Can an LLC transfer money to the current account of an individual entrepreneur, and can an individual transfer tax (according to the personal income tax return-3) from the current account of an individual entrepreneur?

If the premises are rented on behalf of an individual, then it is better not to use an individual entrepreneur’s current account. Using a current account may serve as a reason for the inspectorate to assess additional taxes according to the taxation system chosen by the individual entrepreneur. Similarly with the declaration - it is better to transfer personal income tax on behalf of the individual.

This is due to the fact that what matters is the actual use of the property - for personal or business purposes. The property of an individual entrepreneur and an individual is inseparable. Peculiarities arise only in connection with taxation. In particular, the payment of taxes depends on whether an individual uses property for business activities or for personal needs. If the premises are used in business activities, then for the activities in which these premises are used, the individual entrepreneur will pay taxes according to the chosen taxation system.

The rationale for this position is given below in the materials of the Glavbukh System.

1. Article:An entrepreneur sells his own real estate

What to do: pay tax on the income received according to the simplified tax system if property that was used in business activities is sold. If the property was used for personal purposes and was owned for less than three years, then you need to pay personal income tax.

An entrepreneur as an individual can buy and sell his property. At the same time, he needs to evaluate whether such a sale is a way to generate income from the business. Or the sale of real estate is due to the personal needs of the entrepreneur as an individual. When making a choice in favor of one or another option, you need to pay attention to some nuances, which we want to talk about.*

Case No. 1. Sale of property as part of business

To begin with, let us recall the following. To engage in business, an individual must register as an individual entrepreneur and indicate the type of activity that he will engage in.

Receipts from this type of activity will be income received from business activities. Accordingly, if an entrepreneur applies the simplified tax system, and the income received from the sale of real estate relates to entrepreneurial activity, then they will be taxed within the framework of the simplified tax system (). And at the same time, these incomes will be exempt from personal income tax (clause 24, article 217 of the Tax Code of the Russian Federation). The Russian Ministry of Finance takes a similar position in letter dated August 12, 2010 No. 03-04-05/3-452.

It does not matter whether a real profit was made from the sale or not. The main thing is the very fact that actions are aimed at making a profit from the sale of property. This is confirmed by the judges (resolutions of the Presidium of the Supreme Arbitration Court of the Russian Federation dated March 16, 2010 No. 14009/09 and the Federal Antimonopoly Service of the North-Western District dated March 15, 2012 No. A05-5609/2011).*

When deciding whether the sale of real estate is a business activity, you need to pay attention to what OKVED code is entered by the entrepreneur into the Unified State Register of Individual Entrepreneurs.

For example, during registration, such types of activities as “preparation for the sale of one’s own real estate” and “purchase and sale of one’s own real estate” are indicated (OKVED codes 70.11 and 70.12, respectively). Then income from the sale of real estate can be considered as revenue from business activities and subject to a “simplified” tax (clause 1 of Article 346.15 of the Tax Code of the Russian Federation). A similar opinion was expressed in letters from the Ministry of Finance of Russia dated 09/08/2011 No. 03-11-11/226 and dated 12/05/2011 No. 03-11-11/309.

If only one code 70.11 “preparation for the sale of one’s own real estate” is indicated in the Unified State Register of Individual Entrepreneurs, then the proceeds from the sale of real estate are no longer business income. This means that you will be subject to income tax. individuals at a rate of 13% (clause 1 of article 224 of the Tax Code of the Russian Federation).

Let us note that an entrepreneur is not prohibited from making changes to the Unified State Register of Individual Entrepreneurs and adding new types of activities by reporting this to the tax office (Clause 5, Article 5 of the Federal Law of 08.08.2001 No. 129-FZ). Therefore, if necessary, you can first add another type of activity, and then sell the property.

You can do it differently. Immediately upon registration, instead of, for example, two codes 70.11 and 70.12, indicate one - the more generalized code 70.1 “preparation for sale, purchase and sale of own real estate.” Then the question of whether this type of activity is taxed under the simplified tax system or not will not arise.

Case No. 2. Sale of real estate that is no longer used in business activities

It is also possible that an entrepreneur stops using his own real estate in business and sells it. For example, when registering, an entrepreneur indicated a type of activity such as renting out property. Accordingly, he received income from this type of activity and they were taxed according to the simplified tax system (clause 1 of article 346.15 of the Tax Code of the Russian Federation).

If the businessman then decides to sell the premises itself, then the income received will not be taken into account when “simplified” (letter of the Federal Tax Service of Russia dated August 19, 2009 No. 3-5-04/1290@). Moreover, as the tax authorities indicated, the entrepreneur in this case can receive a property deduction for personal income tax. There are also court decisions that support this point of view (see, for example, the resolution of the Federal Antimonopoly Service of the North-Western District dated December 21, 2011 No. A13-2339/2011).

Thus, if an entrepreneur, before selling property as part of a business activity, stopped using it in business, he will have to pay personal income tax on the proceeds.*

Case No. 3. Sale of a personal apartment

And finally, let's look at the third option. An entrepreneur sells real estate, for example own apartment which was used for personal purposes. Then he, like any other individual, needs to pay the appropriate amount of personal income tax or apply a property deduction subject to compliance with the requirements of the Tax Code of the Russian Federation.

By general rule Personal income tax is levied on income received from the sale of property located on the territory of the Russian Federation, as well as outside its borders (and the Tax Code of the Russian Federation). Moreover, if the property has been owned by an individual for three years or more, then there is no need to pay personal income tax (subclause 2, clause 1, article 228 and clause 17.1, article 217 of the Tax Code of the Russian Federation). If a citizen has owned real estate for less than three years, then on the income from the sale of such real estate he will have to pay personal income tax at a rate of 13% (clause 1 of Article 224 of the Tax Code of the Russian Federation). As a rule, an individual independently calculates and pays tax, and at the end of the year in which income from the sale was received, submits a tax return).

Instead of a deduction, you can use another right. Namely, reduce the income from the sale of real estate by the amount that was paid for it at the time. This is convenient if the property was purchased and not received, for example, by inheritance. In this case, the costs must be documented.

G. N. Afinogenova

chief specialist-expert of the department of methodology, automation of tax control and organization of interdepartmental interaction Control Department Federal Tax Service of Russia

2. Article: There are reasons not to pay VAT when selling personal property of an entrepreneur

“...I keep records for an individual entrepreneur on common system. He leased a car to deliver goods to clients. Now he has fully paid off the lease payments, and decided to keep the car for personal use, since he uses the services of couriers for delivery. This year the businessman is selling the car as a “physicist”. Should I pay VAT on sales?..”

- From a letter from chief accountant Valentina Lipina, Moscow

Valentina, we believe that an entrepreneur has the right not to pay VAT.

As a general rule, an entrepreneur pays VAT on sales on the general system (clause 1 of Article 143 of the Tax Code of the Russian Federation). But a businessman has the right to use his property for personal purposes. In your case, he sells transport that he no longer uses to generate income. Therefore, if a type of activity such as the sale of cars is not recorded in the Unified State Register of Individual Entrepreneurs, the tax may not be paid. Inspectors sometimes argue with this, but in court entrepreneurs manage to prove their case (resolution of the Federal Arbitration Court of the Central District dated March 17, 2010 No. A62-7448/2009).

There is another argument. The sale of a car is a one-time transaction. This means that it is not a business activity. After all, it includes the systematic receipt of profit (Clause 1, Article 2 of the Civil Code of the Russian Federation).*

Stepan Gurkin, UNP expert

As noted above, since an individual entrepreneur is a natural person, he owns property that he uses for commercial purposes and property used for personal purposes. And although it is not actually divided, legally the property of an entrepreneur, used by him to make a profit, is separated for the purpose of calculating certain taxes. For example, in professional tax deduction When calculating personal income tax, you can only include expenses related to property used in business activities. The situation is the same with expenses under the simplified tax system and unified agricultural tax.

An individual entrepreneur must independently determine whether, for tax purposes, property should be classified as used in business activities or not. But in practice this can be quite difficult to do. For example, a car, the computer may well be used simultaneously both for personal purposes and for profit. And expenses for such property are the reason for constant disputes between tax authorities and entrepreneurs. Especially it concerns passenger cars and expenses associated with them.

Another problem related to the property of an individual entrepreneur is related to the Family Code. As you know, property acquired during marriage belongs to both spouses (unless otherwise provided by the marriage contract). For property used by a citizen for the purpose of carrying out entrepreneurial activities, there is no exception from the joint ownership regime.

Considering that the ownership, use and disposal of common property is carried out by mutual consent of the spouses, it should be recognized that a married entrepreneur is somewhat limited in the use of his property for business purposes. Thus, in order to dispose of real estate and carry out transactions requiring notarization and (or) registration, an individual entrepreneur must obtain the notarized consent of the other spouse. Surprises can also await an entrepreneur during a divorce, because the ex-spouse has the right to half of all property. And, for example, an individual entrepreneur conducting trading activities in a store may lose half of the goods, half of the store’s area, etc.

It should be taken into account that spouses have the right to change the regime of joint ownership established by law (Article 34 of the Family Code) and establish a regime of joint, shared or separate ownership of certain types of property or all property in its entirety. Thus, a prenuptial agreement can be used to determine legal regime property of an individual entrepreneur, including in matters of his property liability.

: registration of ownership

Recently, cases of treatment have become more frequent individual entrepreneurs for registration of ownership of real estate, which raises a number of specific questions.

When an organization acquires, for example, warehouse space, she puts it on her balance sheet, this property is used in economic activity and is the property of the organization. When an individual entrepreneur buys a property, he registers his right as an individual. Who owns this property: an individual entrepreneur or an individual? What if the property is used both in business and for personal purposes? How to distinguish between personal property and property used for business activities in the event of bankruptcy of an individual entrepreneur?

These and other questions arise for individual entrepreneurs who use property subject to state registration in their activities. Let's try to answer them.

Is it possible to register real estate to an individual entrepreneur?

In accordance with paragraph 1 of Art. 23 of the Civil Code of the Russian Federation, a citizen has the right to engage in entrepreneurial activity without forming a legal entity from the moment of state registration as an individual entrepreneur. Under entrepreneurial activity according to Art. 2 of the Civil Code of the Russian Federation is understood as independent activity carried out at one’s own risk, aimed at systematically obtaining profit from the use of property, sale of goods, performance of work or provision of services by persons registered in this capacity in the manner prescribed by law. State registration of an individual as an individual entrepreneur is carried out in accordance with the Federal Law - Federal Law “On State Registration of Legal Entities and Individual Entrepreneurs”.

According to the general rule enshrined in paragraph 3 of Art. 23 of the Civil Code of the Russian Federation, the rules of the Civil Code of the Russian Federation are applied to entrepreneurial activities of citizens carried out without forming a legal entity, which regulate the activities of legal entities that are commercial organizations, unless otherwise follows from the law, other legal acts or the essence of the legal relationship. Legal relations of property belong precisely to that category of legal relations that are regulated by legal norms relating to citizens.

Note:

The law does not provide for the division of property of a citizen as an individual entrepreneur and as an individual.

According to Art. 24 of the Civil Code of the Russian Federation, a citizen is liable for his obligations with all the property belonging to him, with the exception of property on which, in accordance with the law, cannot be levied. Consequently, an individual can acquire ownership of real estate only in the status of an individual, but not an individual entrepreneur. Ownership of something does not depend in any way on the acquisition or termination of the status of an individual entrepreneur. This is one of the main differences between the two forms of entrepreneurial activity - a legal entity and an individual entrepreneur.

As stated in paragraph 3 of Art. 49 of the Civil Code of the Russian Federation, the legal capacity of a legal entity arises at the moment of its creation and terminates at the moment of making an entry about its exclusion from the Unified State Register of Legal Entities. That is, after its creation entity has the right to acquire any property. As for the termination of the activities of a legal entity, this can take place through either reorganization or liquidation. For both cases, the law provides for a special procedure during which issues of future fate property of a legal entity. There is no liquidation procedure for individual entrepreneurs. Citizen submits Required documents to the registration authority, and thus his status as an individual entrepreneur is terminated. And this does not in any way affect his legal property relations.

This position is also supported in the Letter of the Ministry of Economic Development of the Russian Federation dated January 1, 2001 No. OG-D05-63. The Ministry of Economic Development refers to Art. 212 “Subjects of property rights” of the Civil Code of the Russian Federation, according to which private, state, municipal and other forms of ownership are recognized in the Russian Federation. Property can be owned by citizens and legal entities, as well as the Russian Federation, constituent entities of the Russian Federation, municipalities (clause 2 of Article 212 of the Civil Code of the Russian Federation). This list includes only a citizen and does not include an individual entrepreneur.

Article 218 of the Civil Code of the Russian Federation establishes the grounds for acquiring property rights. Thus, ownership of new thing, manufactured or created by a person for himself in compliance with the law and other legal acts, is acquired by this person. Receipts received as a result of the use of property (fruits, products, income) belong to the person using this property legally, unless otherwise provided by law, other legal acts or an agreement on the use of this property. The right of ownership to property that has an owner can be acquired by another person on the basis of a contract of sale, exchange, donation or other transaction for the alienation of this property. In the event of the death of a citizen, the ownership of his property is inherited by other persons in accordance with a will or law. In case of reorganization of a legal entity, the ownership of the property belonging to it passes to legal entities - legal successors of the reorganized legal entity. In cases and in the manner provided for by the Civil Code of the Russian Federation, a person may acquire ownership rights to property that does not have an owner, to property whose owner is unknown, or to property that the owner has abandoned or to which he has lost ownership on other grounds provided by law . That is, the right of a citizen established by civil law to own property acquired on the grounds listed in Art. 218 of the Civil Code of the Russian Federation, is not determined by the presence or absence of the status of an individual entrepreneur.

In addition, Art. 5 Federal Law-FZ “On state registration of rights to real estate and transactions with it” (hereinafter referred to as the Federal Law) stipulates that the participants in the relations arising during the state registration of rights to real estate are, in particular, the owners of real estate, which include including citizens of the Russian Federation. Individual entrepreneurs, based on the interpretation of this article, are not independent subjects of these legal relations. That is, when registering rights to real estate and transactions with it, an entrepreneur without forming a legal entity enters into legal relations regulated by Federal Law as a citizen. Moreover, clause 18 of the Rules for maintaining a single state register rights to real estate and transactions with it, approved by the Decree of the Government of the Russian Federation (hereinafter referred to as the Rules), also does not provide for the indication in this register of information about whether an individual has the status of an individual entrepreneur. It should also be noted that the Rules establish the specifics of state registration of rights and transactions only in relation to enterprises (clause 28).

Thus, the ownership of a real estate property is registered in the generally established manner for the citizen, regardless of whether he has the status of an individual entrepreneur.

It is also necessary to note the fact that a legal entity, unlike a citizen - an individual, has separate property and is liable for its obligations with this property. A citizen (if he is an individual entrepreneur without forming a legal entity) uses his property not only to engage in business activities, but also as his own personal property necessary for the exercise of inalienable rights and freedoms. The citizen’s property in this case is not legally demarcated (clause 4 of the Resolution Constitutional Court RF dated January 1, 2001 No. 20-P).

The inadmissibility of registering ownership of a real estate by a citizen as an individual entrepreneur is directly confirmed by judicial practice. Thus, in the Resolution of the Seventh Arbitration Court of Appeal dated January 1, 2001 No. 07AP-4096/2010, the court, analyzing the provisions of paragraphs 1 and 4 of Art. 23, art. 24 Civil Code of the Russian Federation, art. 131 of the Federal Law - Federal Law “On Insolvency (Bankruptcy)”, came to the conclusion that the current legislation does not distinguish between the property of individuals and individual entrepreneurs/

For all questions that arise when registering the ownership rights of an individual entrepreneur to real estate, you can get advice at the address: Zonal district, village. Zonalnoe st. Lineinaya 1, tel.-4-82, 22-9-96

Head of the Zonal Department of the Administration Federal service state registration, cadastre and cartography by

When designating persons who are engaged in business, it is necessary to distinguish between what they do, from how exactly they carry out their activities, in what organizational and legal form.

A businessman is an entrepreneur in terms of employment. But it is not at all necessary that he be an individual entrepreneur. This concept denotes the organizational and legal form of an enterprise.

1. PJSC - public joint stock companies (formerly OJSC).
2. JSC - non-public joint stock companies (formerly CJSC).

That is, any businessman or entrepreneur can engage in entrepreneurial activity through any of these four organizational and legal forms, including through an individual entrepreneur.

All these forms are divided into individuals and legal entities. The former can only be individual entrepreneurs, and the latter - LLC, PJSC and JSC. But even here there is a small catch that is misleading.

For example, you can hear that there is an entrepreneur I know who has registered a legal entity in which he is one owner. This leads to the incorrect conclusion that an individual entrepreneur can be a legal entity.

Let's return to what was said above. An individual entrepreneur is one type of organizational and legal form, and a legal entity (LLC, PJSC or JSC) is another type. Another thing is that the founder of a legal entity can only be one person. When registering an organization, it is not at all necessary to submit the minutes of the meeting of founders in the package of documents. If there is only one owner, a decision on establishment is submitted.

As a result, it turns out that the entrepreneur is the sole owner of the legal entity. The law limits the sole registration of a company if the founder is a legal entity with one owner.

An individual entrepreneur can be a legal entity.

And yet there are situations when an individual entrepreneur can be a legal entity. This is possible if the founder of the legal entity is already an individual entrepreneur. This is permitted by law:

1. When registering an organization and filling out form P11001, there is no need to enter information about a previously registered individual entrepreneur.
2. Participants in companies can be both legal entities and individuals. Individual entrepreneur is an individual.
3. Civil legislation does not limit the rights of individual entrepreneurs as individuals.

There is no direct rule providing for or prohibiting the registration of a legal entity by an individual entrepreneur. And what is not prohibited by law is permitted. Thus, the same person can be both an individual entrepreneur and a legal entity in one of the organizational and legal forms.

What does this give?

For an individual, such a combination, apart from dividends from different enterprises, does not bring anything else:

1. The two forms of organizations do not intersect or add up to each other.
2. The possibility of using this fact to optimize taxes is excluded.
3. The individual entrepreneur still bears the obligation to answer to his obligations with all his property.

In practice, this means that the entrepreneur is forced to report to the Federal Tax Service in parallel under two organizational and legal forms:

1. For an individual - individual entrepreneur.
2. By legal entity - LLC, PJSC or JSC.

A person will be able to dispose of income received from the activities of an individual entrepreneur at his own discretion and in in full. But the distribution of income received from a legal entity occurs in strict accordance with the law:

1. It is prohibited to withdraw unlimited funds.
2. It is necessary to distribute among the founders, even if there is only one.
3. Profit distribution is carried out once per reporting period.

Taxes for both enterprises are paid separately, depending on the chosen taxation system. In case of violations in the activities of one or another company, a fine is imposed on the company whose employees made the mistake. Accordingly, the size of the fine will be different.

For example, for a bounced check, the fine for an individual entrepreneur is from a quarter to half of the settlement amount, but not less than 10 thousand rubles, and for a legal entity for the same violation, you will have to pay 75-100% of the settlement amount, but not less than 30 thousand rubles. If a check for the amount of 500 rubles is not cleared, the individual entrepreneur will pay a fine of 10 thousand rubles, and the LLC - 30 thousand rubles.

Individual entrepreneur is the head of a legal entity.

Another situation is when an individual entrepreneur can be a legal entity if an agreement is concluded with him for the provision of services for the management of an LLC, PJSC or JSC. That is, the entrepreneur provides the services of a manager of a legal entity.

The advantage for the founders of the company in this approach:

1. Payment for IP services is written off as expenses.
2. There is no need to pay insurance premiums for the manager.

Employees law enforcement Often such schemes refer to an attempt to evade paying taxes.

But even more questions arise if such an individual entrepreneur is one of the founders of a legal entity. In this case, tax authorities use the term “interdependent persons,” agreements between which are very suspicious and attract attention from regulatory authorities.

What did we find out in the end?

Summarize. An individual entrepreneur is an individual.

And in professional slang, an individual is called a “physicist.” This concept should not be confused with a scientist involved in science - physics. Here, financiers, tax specialists and lawyers have developed such an expression to simplify and speed up understanding. Of course, we often hear this: “Let’s hold a seminar on taxation for the “physicists.” It should be understood that the slang “physicist” hides the whole mass of people, united not only by the status of an entrepreneur, but also by one of the types of organizational and legal forms.

Having an individual entrepreneur does not at all exclude the right to open an LLC or other legal entity. The reasons why an entrepreneur would want to do this are different. But such a possibility exists.

In the professional environment of financiers, tax specialists and lawyers, legal entities have come up with their own slang - “jurik”. This concept should be understood and deciphered as a legal entity. This slang word greatly simplifies many aspects, because mentioning the type of legal entity every time can be very tedious, and when you say, for example: “Today, legal entities need to submit a report on average number“, then everything immediately becomes clear and simple to everyone.

Imagine how this same phrase would look if there were no such slang solution: “Today LLC (limited liability company), JSC (non-public Joint-Stock Company), PJSC (public joint stock company), NP ( non-commercial partnership), MRO (local religious organization) and so on. must submit reports on the average number of employees."

It is also worth noting that running a business as a legal entity is much more difficult than as an individual.

Those reports and checks that an individual entrepreneur can easily bypass, a legal entity certainly will not.

With this article, we in no way encourage you to make some kind of quick decision on what to register - an LLC or an individual entrepreneur, if we are talking about one person (founder, participant), since it is almost impossible to register a PJSC or JSC with one founder.

A few words about the advantages and disadvantages between organizational and legal forms:

Table of comparisons of individual entrepreneurs with legal forms of enterprises.
ADVANTAGES
Entity
The most profitable lending from banks is available for fairly large amounts, including the opportunity to open lines of credit, as well as use some forms of financing that, from the point of view of banking security requirements, are simply not available to an individual entrepreneur. These forms include umbrella overdrafts, when a legal entity may have “subsidiaries” in the group that may allow the bank to overspend.	An individual entrepreneur has no requirements for the size of the authorized capital.
Legal entities interact much more easily with their counterparties in matters of obtaining deferments or installment plans for payments, or vice versa in the ability to defend their terms of debt repayment.
It is much easier for a legal entity to register its brand in order to become more recognizable on the market, since the presence of its own brand is a very significant argument in the success of the entire business.	An individual entrepreneur is exempt from a large amount of reporting, which must be submitted to various regulatory authorities for verification. A legal entity has much more of it.
Private investors will be able to participate in a business with a legal entity form. Over time, in the case of a successfully developed business model, the company, if it was an LLC, will become a joint stock company due to growth. And then everything can turn out so successfully that it’s not far from the world market.	The legislation stipulates that the amount of fines for similar violations of the law in most cases for an individual entrepreneur is significantly lower than for legal entities. This means that an individual entrepreneur is primarily an individual, who is initially less protected than a legal entity.
	Only an individual entrepreneur has the opportunity to apply the simplest form of taxation - patent. You bought a patent, and you are freed from many problems.
	Only an individual entrepreneur can count on benefits on insurance premiums. In the case of individual entrepreneurs, these are fixed amounts, and not “linking” the size of the contribution to the level of income, which is established for legal entities. Moreover, for individual entrepreneurs, the law establishes reduced tariffs for hired workers.
	The state registration procedure is much simplified. It requires a minimum of documents, practically only one - an application for state registration of individual entrepreneurs, since the rest are a document confirming payment of the state fee, as well as an identity document that everyone has. There is no need for a separate legal address. Its status will be determined by the address of your permanent registration (in some cases temporary registration). Moreover, the state registration fee is much less than that of a legal entity. For individual entrepreneurs it is 800 rubles, for legal entities it is 4000 rubles.
FLAWS
Entity	Individual entrepreneur
For a legal entity, the state registration procedure is much more complicated and the costs are quite impressive than for an individual entrepreneur. For example, the following will be necessary in this case: Charter of the legal entity, protocol general meeting founders, agreement on the establishment of a legal entity, application for registration of a legal entity, letter of guarantee about the legal address (location of the permanent executive body of the legal entity), list of participants of the legal entity, etc. In addition, the state duty is quite high - 4,000 rubles.	An individual entrepreneur is liable for obligations with all his property, even if he does not participate in business activities.
For a legal entity, including when working on the simplified tax system, it is necessary to maintain full-fledged accounting records, although in some cases it is possible to combine the functions of a chief accountant with the sole head of a legal entity (if it is not a legal entity).	An individual entrepreneur has quite a large restriction in conducting certain types of business activities. For example, an individual entrepreneur cannot engage in banking activities and sell alcohol at retail.
The volume of reporting provided to regulatory authorities is much higher than that of an individual entrepreneur.	At the moment, there is a problem in the insufficient development of the legislative framework. This situation concerns the application of certain VAT benefits, as well as the accounting of certain expenses when calculating income tax.
The obligation of a legal entity to pay certain types of taxes from which individual entrepreneurs are exempt.	It is much more difficult for an individual entrepreneur to expand his business, as there will be problems with lending for large amounts, including preferential ones. In addition, it will be almost impossible for an individual entrepreneur to attract third-party investments into his business.

In fact, now you have a fairly extensive amount of information necessary to make a decision in choosing a legal form.

However, it seems to us that you should first try to feel like an individual entrepreneur by registering as such, expressing your desire, including the preparation of documents, including an application for state registration of an individual as an individual entrepreneur (form P21001 ) .

Moreover, you have already been a “physics” since birth; all that remains is to further expand this concept to its interpretation in the economic, legal and financial environment.

As for “legal entities,” this is already a more powerful organizational and legal form that has absorbed financial, tax and legal status.

The status of “physicist” is enough for you to develop and promote your business – good. At least with him everything is much simpler and less rigid.

If you decide for yourself that you cannot do without the status of a “legal entity,” then register a legal entity. Notice the difference? One word, but different endings: register - if you are a “physicist” - an individual entrepreneur, or register, if you are a “legalist” - a legal entity.

Due to the fact that individual entrepreneurs have a special regime that significantly distinguishes them from legal entities, in some cases the question arises about what kind of private property individual entrepreneurs have. This is especially important when government agencies may impose various financial sanctions on an entrepreneur in the form of fines; failure to fulfill obligations to creditors also entails foreclosure on various property of the individual entrepreneur.

Before moving on to a detailed consideration of the issue of what is the property right of individual entrepreneurs, it is important to understand what legal status such business entities have.

Individual entrepreneurs occupy a special position, which is caused by the fact that they conduct business activities from which they receive profit, participate in all economic and administrative relations with other business entities and regulatory authorities.

As a general rule, an individual entrepreneur is an individual who undergoes special registration with a government agency and begins to conduct business activities at his own peril and risk. That is, he is fully responsible for his activities, and bears full financial responsibility for this.

An individual entrepreneur is not a legal entity, but when entering into economic relations, he is assigned a certain responsibility (legal, financial). Therefore, if any consequences occur (collection of penalties, imposition of penalties), arrest for their failure will be imposed on the personal property of the individual entrepreneur.

This is due to the fact that the line between the individual property of an individual entrepreneur and that which he uses for business activities is blurred. Therefore, legislators and arbitrage practice does not identify personal and commercial property of an individual entrepreneur, but classifies it as assets that can be seized and foreclosed on.

It is important to know that thanks to this legal status of an individual entrepreneur, the latter bears financial responsibility with all his property, regardless of how it is used (for personal use or for commercial activities).

The only thing that needs to be paid attention to is the fact that commercial property is collected first, and if it is not enough to cover the debt, then the relevant authorities foreclose on the individual property of the entrepreneur.

Property of an individual entrepreneur

Having understood the specifics of the legal status of the property of individual entrepreneurs, we can move on to its classification.

• Real estate.
• Movable property.
• Money, material assets, shares.
• Intellectual property.
• Shared property.
• Pensions, salaries, interest on deposits.

The first type of property can be divided into two parts:

• Residential Properties;
• commercial real estate.

Residential real estate includes real estate that is used for residence by an individual entrepreneur and his family members. There is no law limiting how many apartments or houses an entrepreneur can have. But in the event of failure to fulfill any obligations, and the subsequent collection of penalties and other material obligations, this property may be seized, and it will be sold in the manner prescribed by law. Such real estate also includes land agricultural purposes.

The special status of residential property includes such a fact as joint shared ownership of spouses, as well as the right of young and minor children to living space. When seizing and selling residential property, bailiffs will take such legal subtleties into account.

Commercial real estate is real estate that is used for business activities. This includes office and industrial premises, land plots, and other buildings that are used to generate profit or income. This type real estate is primarily subject to foreclosure, since it relates to the fixed assets of the entrepreneur’s economic activity.

It is important to know that the spouse of an individual entrepreneur can withdraw part of such property (residential or commercial) from confiscation if it is divided between the spouses in court.

The next type of property is movable. This includes cars, other similar machinery, various equipment, Appliances, as well as means of production, goods. Its list is wide, and the line between individual and commercial use is blurred.

You should know that such property is primarily subject to foreclosure, since it is to a greater extent that it is used to generate income from business activities.

Money, shares, bonds, other securities and material assets in the form of precious jewelry represent the main assets of any individual entrepreneur. Bailiffs primarily pay attention to such property. Money and other valuables can be kept in banks, as shares in the authorized funds of various legal entities. All this is subject to penalties, even if they were received or accumulated before the start of business.

Intellectual property is special kind property, which is regulated by individual regulations. Main feature of this property is that it is not material ( literary works, poems, songs, any inventions for which there is a patent). In most cases, it is impossible to foreclose on such property, but if it generates any income or profit that comes in the form of Money, then such proceeds may be seized.

The shared property has the following composition:

• share in any legal entity (LLC, joint stock company), authorized capital, which makes investments;
• joint ownership, when an entrepreneur owns different shares in residential or commercial real estate.

This property is also subject to recovery, but if it is in the share of a legal entity, then it will be recovered only to the extent that belongs to the individual entrepreneur.

Pensions, salaries, and deposits that are located in various banks or other financial institutions are also subject to recovery. In some cases, such income can save an individual entrepreneur from harsh measures taken by services that collect property.

On Bank deposit, in addition to the dividends it brings, can be completely seized and recovered in favor of the creditor.

It is important to know that the responsibility of an entrepreneur with all his property to creditors is some limiting factor on the development of small businesses in our country. Although the state is trying to stimulate small businesses, so far there have been few changes in the Legislation towards confiscation of the property of individual entrepreneurs.

Considering that an individual entrepreneur has a dual status, that is, on the one hand it is an individual, and on the other it is a subject of economic activity, the procedure for forming private property in an individual entrepreneur is as follows:

• property received as an individual, which may include inheritance, donation, lottery winnings, wage, pension, other ways;
• property acquired in the course of business activities, which may include fixed and current assets (real estate, dividends, material assets).

It is important to know that, despite the different mechanisms for acquiring property, the individual entrepreneur is still responsible and liable to creditors with all the property he owns.

According to current legislation, no property can be confiscated without legal grounds.

Individual entrepreneurs who conduct business activities are especially vulnerable to such confiscation, since all things that they use for commercial activities and personal use are subject to attack.

If legal entities are liable only within the limits of their main and working capital, and their founders can only lose their remuneration in the form of dividends, then for entrepreneurs everything is different.

But this is not a reason to be upset. First of all, it is necessary to clarify that any property of an entrepreneur is subject to the mechanism of jointly acquired property if he is married, as well as the legal mechanism for the protection of minors and young children in the event of foreclosure on housing.

Therefore, in case of failure to fulfill his obligations, an individual entrepreneur should know that in this regard he is more protected than a legal entity.

The law that regulates the bankruptcy procedure of an individual entrepreneur deserves special attention. Only a court can declare an individual entrepreneur bankrupt by its decision. This status is not a death sentence, and after some time a person who has been declared bankrupt can again engage in entrepreneurial activity. But for this to happen, some period of time must pass.

Also, legislation that regulates the procedure for confiscation of property of individuals, including individual entrepreneurs, since the regime of private property of individual entrepreneurs is similar to the private property of an individual.

An approximate list of property that is not subject to recovery is as follows:

• V rural areas- this is the house where a person and his family live;
• a plot of land located near a house located in a rural area;
• clothing items for every family member, for every season;
• individual jewelry that belongs to the entrepreneur and his family members;
• household items that are used for cooking and housekeeping;
• in the event of confiscation of residential premises, the entrepreneur and his family must be evicted to temporary living quarters.

It is important to know that this list of property that is not subject to collection may change due to the adoption of new laws and other regulations.

The bankruptcy law for individual entrepreneurs provides for declaring him completely insolvent to his creditors. That is, such a person is unable to fulfill his obligations, which may arise from tax or business obligations. Lenders can be government bodies(tax inspectorate, other regulatory organizations that have the right to impose penalties), as well as business entities with which the individual entrepreneur has contractual relations.

Private property, which may be owned by individual entrepreneurs, is formed from various sources. The first is property that goes to a person through civil law mechanisms (donation, inheritance, receipt of salary and pension). The second source is entrepreneurial activity which brings material income. But the individual entrepreneur is liable to his creditors with all his property, regardless of how he got it.

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