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Are companies allowed to pay PIT in advance?

Are companies allowed to pay PIT in advance?

PIT (personal income tax) could be paid prior to salary payment.

The main aspect is to withhold the tax from employees and to show that in the reports. This conclusion is drawn from the Moscow Region Commercial Court resolution concerning corresponding proceedings.

Tax Office claimed that a company should pay PIT on the same date together with the salary payment. The company brought forward the following arguments in its defense:

  • The term of PIT payment is too short – it is easy to miss it. That was the reason why the company paid PIT in advance.
  • The company always withheld PIT from employees, even if it was paid in advance. That means that the tax was not paid at the expense of organization.

The Court agreed with the company and did not see a basis for charging penalties in this matter.

However, to avoid continuous disputes with the Tax Office, we recommend refraining from advanced PIT payments.