Features of calculating and processing salaries for the chairman of the HOA

The Housing Code of the Russian Federation provides for the possibility of paying remuneration to the chairman and members of the board of the HOA. And if, for example, in the case of concluding an employment contract with the chairman of the HOA, the procedure for paying insurance premiums and personal income tax from the chairman’s salary does not raise any special questions, then in the absence of employment contracts, the relevance of such issues increases significantly.

In this article we will examine the issues of the size and frequency of payment of remuneration, the method of receiving it, the obligation to pay insurance premiums and personal income tax and the determination of the person obliged to make such payments (and the corresponding deductions). Additionally, we will discuss the issue of indexing pensions for members and chairmen of the HOA board who are pensioners, and also consider the issue of paying bonuses to the chairman and members of the HOA board.

Can the head of the Partnership receive remuneration for his work?

To officially payroll, an employee must enter into an employment contract with the employer.

Important. By law, a member of the board of an HOA does not have the right to combine his work on the board with work in the partnership under an employment contract. This means that legally the chairman cannot enter into employment contracts with the partnership, and therefore has no right to receive a salary. This is stated in paragraph 3.1 of Art. 147 Housing Code of the Russian Federation.

Taxes on remuneration

We all know that any income is subject to taxes. Chairman's remuneration is no exception. The person holding the post reports expenses to the tax office and provides information about remuneration there.

13% is subtracted from the total incentive amount and paid to the tax office. Only after tax has been deducted does the chairman have his salary in his hands.

How to evaluate remuneration: salary or remuneration?

The work of the chairman is paid in accordance with the Housing Code and the charter of the partnership. Instead of the usual salary, the chairman of the HOA is paid a remuneration consisting of a percentage of the cost of work performed for the purpose of improving the housing complex. They can be repair work at the entrance, repairing or updating the elevator, etc.

The remuneration of the chairman is based on the norms of the Housing Code of the Russian Federation:

• Clause 2, part 11, art. 145 , the competence of the general meeting of HOA members includes the right to determine the amount of remuneration for members of the partnership, including the chairman of the board.
• Clause 8.1 art. 161.1 determines the right of the general meeting of owners of premises in an apartment building to decide on the payment of remuneration to members of the council, including the chairman of the HOA.

Legal status of the chairman of the HOA

The chairman is elected at a meeting - either a general meeting or a meeting of the board, depending on the charter of the HOA. His responsibilities are outlined in the job description, the organization’s charter, as well as the legislation of the Russian Federation.

The chairman’s task is to protect the interests of the owners in the house or houses under his control. As the Housing Code indicates in Article 149, the chairman is responsible for implementing decisions made by the board of the partnership, managing the work of the organization, developing regulations, as well as other functions. He usually has a large number of responsibilities.

At the same time, there is uncertainty as to whether the chairman of the HOA is an official: legislative instructions on this matter are contradictory. He has the right to sign financial documents, and if violations are discovered, he will not be held liable - this is the difference between his status and the heads of commercial enterprises.

But this does not mean that he cannot be held responsible for decisions made and violations in work - in other cases, the chairman can be brought to administrative and even criminal liability.

The chairman must regularly report on his activities - provide the documents required by the audit commission, as well as make an annual report to the general meeting. He should not make decisions against the interests of homeowners in the apartment building he manages, and is also responsible to them for ensuring that the necessary utility resources are delivered to them on time and in the required volumes, and that the HOA funds are spent wisely.

Note that instead of the chairman, similar functions can be performed by the manager of the HOA. The difference is that he will not have the status of an official, instead he is an employee.

A manager is hired if the building does not have a sufficiently competent resident who is willing to perform the functions described above as chairman of the HOA. The chairman of the partnership will also be responsible for its activities.

Determining the size - what does the amount consist of?

There is no single salary amount for the head of an HOA. The amount will depend on the cost of the work performed - the amount consists of a certain percentage of the funds spent on the action. The head of the HOA cannot decide for himself what amount will be paid to him.

The issue of the amount of accrued remuneration is decided only by the owners of the apartments at a general meeting, where the certificates of completed work will be studied and the issue of the percentage for the chairman will be resolved. The maximum and minimum amount of payment is not established by law.

Attention. The amount paid to the manager cannot exceed the amount of work performed.

How to apply for a position

What does the chairman of the HOA receive: salary or remuneration? We have figured it out, but it is still unclear how to fill the position.

To be able to become a chairman, you need to have housing in a certain house. This point is spelled out in Article 143 of the Housing Code. If a person rents an apartment or lives in an apartment that is rented by someone else, he cannot apply for a position.

The same article states that to join a partnership it is enough to submit an application to the chairman or the person who performs his duties.

Once you join the partnership, you need to take the next step. Namely: get on the board. The board is elected at the general meeting of the apartment building. The maximum term of the board is two years, after which elections take place again.

Article 149 of the Housing Code states that the chairman can be elected only for the period specified in the charter. Most often, both the board and the chairman are elected for the same term.

Let's derive the algorithm of actions:

1. Own housing that is located in the building where the partnership operates.
2. Write an application addressed to the chairman or the person performing the duties. This is necessary in order to join the partnership.
3. Wait until the term of office of the chairman and board ends.
4. Attend the general meeting. It is there that the issue of re-election is decided.
5. Be on the list of candidates for the position at the meeting.
6. Make as positive an impression as possible so that more participants will vote.

Everything seems simple, but in order to get on the list of candidates, you need to have the following knowledge and qualities:

1. In-depth knowledge of the legislation of our country.
2. Understand contracts and understand legal language. Without this knowledge it is impossible to work in a position.
3. Mastery of business communication style. The position involves communication with different social strata, which means that the chairman must be able to communicate with any people.

If all these skills are available, then only the social status or age of the applicant can become an obstacle to obtaining a position. Although it is not prohibited by law, they try to choose people with rich experience as chairmen. They are better at navigating situations and are able to effectively lead people, unlike young people.

The more successful a person is, the more likely he is to become chairman. High income and a good reference from the place of work also contribute to the sympathy of the board of the partnership.

Registration procedure

The algorithm for processing remuneration for the chairman of the HOA is as follows:

1. A meeting of homeowners is organized. Owners are informed in advance about the date and time of the event. If the turnout is less than 50%, all decisions approved at the meeting will be invalid.
2. Next, the chairman and other members of the board provide homeowners with certificates of work done in the house and surrounding area. The acts must indicate the cost of all work.
3. The percentage that will be paid as remuneration is calculated. The results are put to a vote, which can be secret or open.
4. Once everyone present at the meeting agrees to a certain value, minutes are drawn up. It states that the chairman has the right to calculate this percentage of the amount in his favor. The protocol is the very document confirming the remuneration of the chairman (how is the chairman of the HOA appointed?).
5. Then all that remains is to submit the protocol to the tax service, and also write there an application for receiving the reward. After that, he withdraws the money due to him from the account.

Salary taxation

Remuneration of the chairman of the HOA - what taxes are it subject to? As you know, any salary is subject to a number of taxes before it reaches its recipient directly.

Therefore, the activities of the chairman, namely the remuneration for it, are also taxable.

However, you should not think that the activities of the head of the HOA are subject to any special taxes. No, personal income tax is also applied to it, and 13% will be deducted from the amount in favor of the state.

The state cannot claim more from the amount due to the chairman monthly. However, for concealing his real income or artificially reducing it, the head of the HOA may also pay with criminal liability.

Resizing – by whom and how is it decided?

Article 145 of the Housing Code of the Russian Federation states that regulating the percentage of remuneration of the HOA manager is the authority of the general council. That is, the issue is also resolved at a general meeting of residents. The chairman himself, like other members of management, do not have the right to make decisions on increasing remuneration.

If the Charter provides for the possibility of changing remuneration, then it can be changed at any meeting. The Articles of Association may limit the maximum percentage of remuneration, and even a vote at a meeting cannot change this.

Important. When making a decision, at least 50% of all residents of the house must also be present at the meeting. Otherwise, the decision made will not be valid.

Where are the conditions stated?

The main conditions are specified in the Charter of the partnership.

The lowest and highest possible percentage are not established by law. The amount of payment for specific work must be recorded in the minutes of the meeting.

If information about the percentage of payments was not included in the Charter initially (or the amount changes), you will have to formalize its change. For this, it is also necessary to hold a meeting. On it, HOA members vote to add (or change) this item. A protocol is drawn up. If more than half of those eligible to vote took part and the result is positive, the information is written down in the document.

Do I need to pay insurance premiums and what?

Because Art. 149 of the Housing Code of the Russian Federation regulates the performance of certain functions by the chairman of the partnership, then his services can be recognized as the labor activity of an individual. This means that the income received by the chairman from activities in the HOA must be subject to insurance premiums in accordance with the general procedure (clause 1 of Article 420 of the Tax Code of the Russian Federation). Those insurance premiums for which the person is insured are subject to payment.

The following fees are usually paid:

• Pension insurance.
• Health insurance.
• Insurance in case of temporary disability.

The structure of the HOA includes a manager, an accountant and an emergency dispatch service, which can be read about on our website.

Pension indexation

Despite the fact that since 2021 the powers to administer insurance premiums have been transferred to the tax authorities, in the process of writing this article we sent a number of appeals to both the Ministry of Finance of Russia and the Pension Fund of Russia (previously it had powers regarding insurance premiums). There has not yet been a response from the Ministry of Finance, but clarifications have been received from the Branch of the Pension Fund for St. Petersburg and the Leningrad Region regarding the payment of insurance premiums.

In its letter (Letter of the OPFR in St. Petersburg and the Leningrad Region dated August 23, 2021 No. 19-02/29988 “On the payment of insurance contributions and indexation of pensions to members of the elected body of HOAs, housing cooperatives”), the Pension Fund indicated that “the election of a person to a certain elective position presupposes the performance of a certain labor function and, accordingly, persons occupying elective positions in non-profit cooperatives (partnerships) are considered to be carrying out labor activities, regardless of the fact of concluding an employment or civil contract with them.”

The Pension Fund also pointed out the obligation of policyholders (homeowners' associations, housing cooperatives) to provide information in the SZV-M form for persons holding elected positions, regardless of the fact of the existence of an employment or civil law contract concluded with them, as well as the frequency of payment of monetary remuneration to them.

To exempt HOAs and housing cooperatives from the obligation to provide information in the SZV-M form, it is necessary to submit to the Pension Fund of Russia the Charter of the HOA, housing cooperative, which states that the person holding an elected position carries out his activities on a voluntary basis, for which the payment of monetary remuneration is not provided .

This is an important circumstance, in particular for cases when a pensioner is elected to an elective position and the question of pension indexation arises. So, if the payment of remunerations, bonuses and other payments is not provided (and most likely a notification about this has been sent to the Pension Fund), insurance payments are not paid (since there is nothing) and indexation is carried out. Otherwise, regardless of the frequency of such payments (monthly or once a year), insurance premiums must be paid to the HOA, housing cooperative, and accordingly, pension indexation is not carried out for pensioners.

Reasons for delay or refusal of payment and solutions

If a situation arises in which the chairman is not paid the required remuneration, then this is a direct violation of labor standards. In this case, the chairman of the HOA has the right to contact the labor inspectorate on this issue. You can also contact the housing inspector at the same time.

The inspectors are obliged to look into the matter and, thanks to their powers, oblige the board to pay the entire required amount for the work done.

Attention! The issue that has arisen can also be resolved at a meeting of homeowners, with a turnout of more than 50%.

The chairman of the HOA is required to receive a salary for his work. But the term “salary” does not apply to him - he has no one to sign an employment contract with. Therefore, he is paid a remuneration as a percentage of the cost of the work done to improve the house and surrounding area.

Issues regarding the amount of wages, its increase, etc. can only be resolved at a general meeting of residents if the turnout is at least 50%. The chairman pays personal income tax from his remuneration. If payment is delayed or refused, he has the right to complain to the labor and/or housing inspectorate.

Legislative regulations

All issues related to construction management fall under the jurisdiction of housing legislation . Therefore, it is not surprising that regarding payment one should also refer to this regulatory act.

Thus, Article 147 of the Housing Code tells us exactly how the leader is elected, which is also important for the overall picture of events.

The amount of payments also falls under the jurisdiction of housing legislation and is regulated by Article 145, namely part 2.

It is this norm that tells us exactly how the chairman’s monetary remuneration for performing any action is formed.

Now that we have established all the aspects that relate to the remuneration of the head of the board and have come to the conclusion that his work is paid through remuneration, it is time to figure out exactly how this remuneration is calculated, in what order, by whom specifically and in what amount.

Let us turn to this information in order to clearly understand how honest your homeowners association manager is with you.

You can find out in what cases it is necessary to inspect the financial and economic activities of an HOA by regulatory authorities from our article.

By what rules is salary calculated and what does it consist of?

By what rules can the remuneration of the chairman of the HOA be calculated and how to draw up a circular? There have been debates for a long time about whether the position of representative of HOA members is an official position, or is it just an additional occupation? In fact, at the moment, representation in an HOA can be combined with any type of work, except for additional work in a homeowners’ association.

The Housing Code of the Russian Federation (Article 146) states that the salary of a manager is calculated by holding a meeting among residents of a multi-storey building attached to a homeowners’ association.

Previously, the amount received was not documented and could be canceled at any time. This is due to the fact that the salary of the representative of the HOA members was based on contributions provided by the residents of the apartment building, the maintenance of which is carried out by the association of property owners.

The law also provides another measure by which the chairman’s salary is calculated - the amount of work performed by the head of the HOA on a multi-storey building. For example, if the person in charge of the HOA members fixed the wiring in the house or fixed problems with the elevator system.

This approach to paying wages is quite motivating, because the more work completed, the higher the amount of payments to the account of the chairman of the property owners’ association.

There are several ways to convey information about a general meeting to residents of a high-rise building:

• sorting invitation letters into residents' mailboxes;
• personal delivery of information and confirmation of residents with familiarization in the form of a signature;
• posting information on a notice board, which is usually installed near an apartment building;
• placing an advertisement on the entrance door so that upon entering it is in front of the eyes of a resident of a high-rise building.

Thus, during the meeting of residents, the agenda of which is the appointment of remuneration for the head of the HOA, it becomes clear how salaries will be calculated - a permanent salary or payments for work performed for the benefit of the high-rise building. Most often, the second option is chosen, since none of the residents usually wants to simply pay for the presence of the manager in the position of chairman of the property management partnership.

An official decision on the amount of remuneration is made when 50 percent of the residents who took part in the meeting vote for the provision of a salary in the established amount.

After a decision is made, it is documented and the methods of making payments are recorded in it.

What to do if the HOA does not pay?

It often happens that people think that the chairman should perform his duties free of charge. They are unaware that the chairman prepares papers on expenses, submits them to the tax and housing inspectorates, wasting his money and time.

Therefore, if a meeting has not been held for more than two months after the work has been done , and the residents do not consider it necessary to pay the chairman a remuneration, then the chairman can contact the housing inspectorate to clarify further actions, or directly to the court.

As a rule, such cases are within the jurisdiction of the district court, so the chairman must write a statement of claim and submit it to the necessary authority, having previously paid the fee.

The application is written according to the established template. It includes a mention of the plaintiff, information about the chairman, as well as about the HOA where he operates.

The text of the application must indicate from what specific period the remuneration has not been paid, what services the chairman has to the residents of the house, and also refer to what reasons the residents consider significant for non-payment. In addition, the application is signed by the chairman and stamped by the HOA.

The application is accompanied by documents that characterize what was written, for example, a report on the work done or a protocol on the selection of a citizen as chairman.

The application must be written on a blank sheet of paper by hand in blue or black ink, necessarily, neatly and legibly, or printed on a computer in a standard font.

As a rule, such situations are not uncommon in judicial practice, and if it is proven that the chairman regularly performed his duties, then an amount will be allocated from the capital repair fund for the chairman’s remuneration, and if the necessary funds are not available, they will be included in the capital repair accounts for payments by residents.

Job description

Each position has its own rules that must be followed. It does not matter at all what the chairman of the HOA receives - salary or remuneration, he must fulfill all the obligations assigned to him and know his rights.

1. A person can serve as chairman for two years. After which elections take place again.
2. The Chairman is obliged to comply with the laws of the country that are in force at the time of exercising his powers.
3. A person holding a position has no right to be negligent in his own responsibilities or to put personal gain above the interests of the partnership.
4. The chairman can give instructions to subordinates. It is important to remember that orders should not contradict local regulations and laws of our country.
5. The chairman of the partnership must supervise the activities of the board and general council.
6. The chairman can take initiative, which is aimed at improving the work of the HOA and the condition of the house.
7. The person who holds the position can represent the interests of the partnership, but a power of attorney is not required.

How to fill out an application correctly: instructions

Receiving wages is possible by submitting an application to the authorized body. The structure of this document is fairly standard:

1. The upper right corner contains information about the authority to which the application is submitted (name, address). Below is information about the plaintiff and the name of the HOA, its address, and contact information.
2. The title is written in the center in the form of the word STATEMENT.
3. The main text contains information about the activities of the head of the HOA, the period of his tenure and actions aimed at improving the house, which is managed by a representative of the partnership. It is imperative to provide evidence of activities aimed at the benefit of residents of a multi-story building who do not want to make payments to the deserving chairman of the homeowners association.
4. The main text is followed by appendices to the application. They can be submitted by copies of documents confirming the completion of repairs and other work for the house, as well as video materials.
5. At the end of the circular, the date of its preparation and the signature of the head of the partnership are indicated.

There are some rules to keep in mind when submitting your application:

1. The application must have grounds for its consideration in the form of evidence.
2. In the text of the circular, it is desirable that there are no grammatical, punctuation, syntactic and other errors that may be acceptable when writing an appeal in Russian - then the case will most likely be considered faster.
3. The structure of the complaint must be followed.
4. It is necessary to avoid excessive emotionality and aggression.
5. The text of the statement should be brief and provide factual information rather than vague explanations.

It is best to write the application by typing it on a computer rather than writing it by hand. But if the appeal is written by hand, then it is best to write it in very legible handwriting. Applications that are unclear or too vague are usually rejected by the authorities.

When can an official be paid for his efforts?

The chairman’s efforts can be paid in cases where they carefully fulfill a number of obligations . Among them:

1. first, the chairman fulfills his duties in full and draws up an act of work performed on their basis;
2. the document must specify the time frame of work, the amount of expenses, the final results and what the chairman himself directly did;
3. after completion, the act is handed over to the members of the HOA board; if they cannot consider it at the moment, a decision and discussion on the document can be held at a house-wide meeting;
4. after checking all the data, the percentage of remuneration is calculated from the amount of money spent, all management members and residents must agree with it;
5. if it was not possible to reach an agreement, the certificate of work performed will be revised and carefully checked;
6. after a positive decision, minutes of the meeting will be drawn up, according to which the chairman will be able to withdraw the payment assigned for his work from the current account of the partnership.

Important! The money is collected from a bank branch or from a regional operator, it all depends on where the partnership opened the account.

To receive a reward, you will need to provide a sheet of paper based on the results of the meeting .

How is this reflected in the accounting records?

Since the performance of his functions by the chairman is in no way connected with the production and subsequent sale of any type of product, does not have labor relations, and is not related to the provision of services, purchase and sale of goods, no special acts are required to be maintained for this item of expenditure.

The accountant of the partnership issues remuneration to the head of the HOA as part of other expenses for maintaining the apartment building .

Important! If necessary, such preparation of documents can be justified by Article 11 of the Labor Code of the Russian Federation, since no employment contract was concluded with the Members of the Board and the Chairman of the HOA.

If any disputes arise regarding the calculation of remuneration to the chairman, you can seek advice from a lawyer . He will look at the situation specifically for a particular partnership and help you understand the current situation. In addition, if it is impossible to reach an agreement, members of the meeting have every right to choose a new head of the HOA without contacting other bodies.