Gifts for Accountant's Day: Is it necessary to accrue the Single Social Contribution (SSC)?

On July 16, Ukraine celebrates Accountant and Auditor Day. On the occasion of this professional holiday, many employers congratulate employees with bonuses, gifts, and other incentives. At the same time, enterprises face a practical question: whether it is necessary to accrue the single social contribution on the cost of such gifts and in which cases they are included in the SSC calculation base.

According to paragraph 1 of part one of article 4 of the Law of Ukraine dated 08.07.2010 No. 2464-VI "On the collection and accounting of the single contribution for compulsory state social insurance," payers of the single contribution for compulsory state social insurance are employers, including enterprises, institutions, and organizations that use the labor of individuals under employment contracts (contracts) or other conditions provided by law, as well as under civil law contracts. At the same time, an exception is civil law contracts concluded with individual entrepreneurs if the performed work or provided services correspond to the types of activities specified in the Unified State Register of Legal Entities, Individual Entrepreneurs, and Public Formations.

According to paragraph 1 of part one of article 7 of Law No. 2464, the SSC calculation base for such payers is the amount of wages accrued to each insured person. This includes basic and additional wages, other incentive and compensatory payments, including those provided in kind, which are determined in accordance with the Law of Ukraine "On Remuneration of Labor."

Article 1 of the Law of Ukraine dated 24.03.1995 No. 108/95-VR "On Remuneration of Labor" establishes that wages are remuneration, usually paid in monetary form, which the employer pays to the employee for the work performed under the employment contract.

The list of payments that belong to basic and additional wages, as well as other incentive and compensatory payments, is defined by the Instruction on Wage Statistics approved by the order of the State Statistics Committee dated 13.01.2004 No. 5.

In particular, according to subparagraph 2.3.2 of section 2 of Instruction No. 5, one-time incentives to enterprise employees not related to specific work results, including for anniversaries, holidays, and memorable dates, both in monetary and in-kind form, belong to the additional wage fund.

At the same time, the cost of gifts for anniversaries and memorable dates that the employer provides free of charge to persons who are not in labor relations with the enterprise belongs to other payments that are not included in the wage fund. According to paragraph 3.32 of section 3 of Instruction No. 5, such payments are considered charitable assistance to persons who are not employees of the enterprise.

Therefore, if gifts for Accountant's Day or other festive and memorable dates are given to employees who are in labor relations with the employer, their cost is included in the base for calculating the single social contribution. If gifts are received by persons who are not employees of the enterprise, it is not necessary to accrue SSC on their cost.

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