Patent taxation system (PSN) for individual entrepreneurs in 2022

The patent system exempts individual entrepreneurs from paying VAT, tax on income and property of individuals. We tell you who is eligible for a patent, for what types of activities it can be acquired, and for which business it is profitable to switch to PSN in 2022

“Finish a patent and no torment with reporting!” – such advice is often given to neophytes of business. It is really convenient for sole proprietors who are just starting their own business to work on the PSN – that is, the “patent taxation system”. Paid a flat tax to the state and no more duties. If we draw an analogy with modern services, then it is like a subscription to streaming: you pay and listen to music. Together with lawyer Irina Minina, we will talk about the features of the patent taxation system (PST) for individual entrepreneurs in 2022.

What is the patent taxation system for individual entrepreneurs

The patent taxation system (abbreviated as PSN) is a special tax regime, for individual entrepreneurs it is considered preferential. An entrepreneur is exempt from paying taxes, but in return must pay for work on a patent – a fixed amount. It is calculated individually for each type of activity and the region in which the businessman is registered.

An entrepreneur is not prohibited from buying several patents for different activities. And also combine PSN with other taxation regimes. Other legal entities – companies (LLC) – cannot work on a patent. The PSN was first introduced in 2013.

Features of the application of patents for IP

Patent valid	Only in the region of issue for a specific type of activity
How many employees are allowed to have	No more than 15 employees
Maximum annual income	Up to 60 million rubles.
What can you do with a patent	Trade, transportation and other services to the population: over 80 types of activities
Validity of the patent	From 1 to 12 months
Tax rate	6%
Fixed premiums	Mandatory, in the amount of 43 rubles. (data for 211)
When does a patent take effect?	Not earlier than 10 days after filing an application with the tax
Where to apply	If the business is at the place of residence – to your tax office; if in another city/region – to any tax office on the territory of this subject
Deadline for issuing a tax patent	5 days from the date of receipt of the application

Law governing patents for IP

The patent system is described in the second part of the Tax Code of the Federation (TC RF) in Chapter 26.5 “Patent Taxation System”¹. Each region of the Federation has a local law on PSN, which clarifies some provisions of the federal law in a particular territory. For example, it sets the size of the tax base.

Types of activities on a patent for individual entrepreneurs

There is a federal list of activities of 80 items – in other words, what a business can do – for which a patent is available. The peculiarity of PSN for individual entrepreneurs in Our Country is that earlier the region, at will, introduced patents on its territory. In 2022, PSN is available nationwide. Also, the regions were given the authority to supplement the list of activities.

The regional lists have approximately the same set as the federal list, but there are slight differences. For example, in the Tver region you can buy a patent for “repair of ships and boats”², and in Chelyabinsk only for “manufacturing and repair of wooden boats by individual order of the population”³.

The differences are minimal. Local authorities are trying to be in trend and promptly add new areas of IP business to the allowed types.

Permitted species

The Tax Code lists 80 types of activities⁴ – retail trade, household services to the population, transportation of goods and passengers and some types of production.

A complete list of permitted activities for your region can be found:

on the FTS website. To do this, select the desired region, the page “Patent taxation system” and the item “Peculiarities of regional legislation”;
Find the PSN Act on the website of your local legislature.

Prohibited Species

You will not be able to apply for a patent for:

production of excisable goods (alcohol, tobacco products);
extraction and sale of minerals;
a store or a catering point, if they have a trading floor area of more than 150 m²;
conducting wholesale trade and trade under supply contracts;
transportation of passengers and cargo in the presence of more than 20 cars in the fleet;
transactions with securities (for example, if you provide brokerage services);
provision of credit and other financial services;
trust management of property (for example, if you own a management company that rents apartments to private owners and receives a percentage for this).

PSN is not suitable for those who work under a simple partnership agreement. All restrictions⁵ specified in article 346.43 of the Tax Code of the Federation, part 6.

The cost of a patent for an individual entrepreneur for a year

Patent cost Per year calculated according to the formula:

tax base X tax rate = patent value.

If you buy a patent, for example, for 1 month, the required number of days is substituted into the formula.

The tax base takes into account not real, but potential income of the entrepreneur. Even if the revenue in the end turned out to be more, then you will not have to pay anything extra.
In one region, the potential income can be 1 million rubles a year, in another region – 500 rubles. It is set by the authorities of each region independently. It may depend on a particular city, the number of employees in the state, the number of outlets and other factors. A table with potential income is attached to the regional law “On the patent system of taxation.”

The tax rate is 6%. Before 31 декабря 2023 года in some regions there are tax holidays – a preferential rate of 0%. It can be obtained by individual entrepreneurs on PSN who first registered with the tax office and began working in the field of personal services to the population, in the industrial, social or scientific fields.

As a result, the cost of a patent can be very different: from 0 (if preferential treatment is in effect) to 100 rubles and more.

Example calculation

An individual entrepreneur from Bashkiria opened a hairdressing salon in Ufa. He will not hire staff. He needs to pay PSN. Substitute the values into the formula.

The tax base, that is, the potential income for hairdressers in the regional law, is 270 rubles. But for Ufa, this value is multiplied by 000. This is written in the regional law. So the base will be 1,5 rubles.

The tax rate is 6%.

RUB 405 X 000% = 6 rubles. will cost a patent for one year.

You can quickly calculate the cost of a patent for an individual entrepreneur for a year or any other period using the tax calculator on the website of the Federal Tax Service.

How to apply for a patent for an individual entrepreneur in 2022

1. Choose a basic taxation system

A patent is a kind of superstructure to another system of taxation. To begin with, an individual entrepreneur must choose whether he will work on a general (DOS) or simplified (STS) taxation system. It is more profitable to register USN. Since if you receive income from activities that are not covered by a patent, you will not have to submit as many reports as on DOS.

For example, you transport passengers on a ship and have bought a patent for this activity. Suddenly, a shipping order appeared. It needs its own patent, but the order is one-time and there is no desire to buy PSN for it. DOS will have to submit reports, pay VAT and income tax. On the simplified tax system – a standard declaration and 6% tax.

2. Check if your business is eligible for a patent

Above, we talked about the types of activities that fall under the patent. There are more than 80 of them, and each region may have its own. In general, most ordinary services to the population and types of trade are eligible for a patent. Do not forget about the rule: an individual entrepreneur cannot have more than 15 employees in the state, and the annual income should not exceed 60 million rubles.

3. Submit documents to the tax office

You can come to the Federal Tax Service in person, or a representative with a notarized power of attorney, or send everything through your personal account.

An application for the transition to the PNS must be submitted for 10 days before starting a business. There are two application forms, both are suitable.

Download the first application form.

Download the second application form.

4. Wait for a response

The tax authorities have five days to answer: does it allow an individual entrepreneur to transfer to a patent or send a refusal.

5. Pay for the patent

If the patent is valid for up to 6 months: payment must be made no later than the expiration date of the patent.

Patent for a period of 6 to 12 months: in the first 90 days from the beginning of the patent, ⅓ of the cost of the patent is paid and the remaining ⅔ until the expiration of the patent.

PSN restrictions

There are two restrictions for entrepreneurs: you cannot hire more than 15 people, and the total income for the year should not exceed 60 rubles. A patent only applies to the territory in which you acquired it. It is impossible to work in Khabarovsk on the basis of a patent acquired in Moscow.

PSN payment order

If your patent is open for up to 6 months, you can pay the full cost of the patent during this period.

When the term is between 6 and 12 months, you need to pay one third of the amount within the first three months of the patent. The remaining amount (⅔) must be paid before the expiration of the patent.

Please note that the entrepreneur can reduce the patent by the amount of insurance premiums. To do this, you need to send the KND form 1112021 to the tax office.

If there are no employees, then the patent can be reduced by the full amount of insurance.
If there are employees, the patent can be reduced by up to 50%.

Accounting and reporting on PSN

When working on PSN, an entrepreneur maintains the same types of accounting as for other taxation systems. Need to submit:

6-NDFL and RSV every quarter – to the tax office;
monthly SZV-M report, annually SZV-Experience, as well as SZV-TD in the presence of personnel events (hiring, transfer, dismissal) – for the pension fund (PFR);
every quarter 4-FSS – for social insurance (FSS).

An IP on a patent also maintains an income book for each of its activities. The book is not rented anywhere, but the tax office may request it.

Pros and cons of PSN

Opportunity to save on taxes.

Choice of any period of validity within a calendar year.

Ability to pay for patents for several activities.

Reducing the cost of the patent by the amount of the sum insured.

Some activities are exempt from online cash registers (for example, individual entrepreneurs without staff who provide services or sell goods of their own production).

The main disadvantage for individual entrepreneurs on PSN: the limitation on the amount of income (60 million rubles per year) and the number of employees (15 people). As soon as the business grows above these figures, the patent will have to be abandoned.

When buying a patent for a year, you must immediately pay a third of the amount.

For each type of activity you need to buy your own patent.

In each region you need to buy your own patent.