Creation of branches as a way to optimize payments to the budget

1. The decision to create a branch
2. We make changes to the charter
3. Approval of the regulations on the branch
4. Power of attorney for the head of the branch
5. Registration
6. Opening a bank account

A branch is a separate division of a legal entity. Unlike a representative office, a branch is not only a legal representative of the company when concluding transactions, but can also carry out business activities at its own separate location. When deciding to expand your business, you have to choose between opening a branch or a subsidiary. The advantage of the branch will be the ease of creation and, subsequently, closure, the ability to control the activities of the branch manager. At the same time, you need to understand that the property of the branch, although in a certain sense is also separate, is not to the same extent as the property of a newly created legal entity. This means that even if the branch itself is solvent and makes a profit, the financial problems of the parent organization will certainly hit the branch.

Branch: concept, criteria

Registration of branches of legal entities

A branch or representative office is a separate structural unit of a company that is located outside the location of the legal entity. As a rule, an organization registers a legal address at the location of the head office, while branches and representative offices are located in other localities (for example, at the location of a retail chain).

Branches and representative offices are registered and operate taking into account the following features:

1. Lack of legal entity . The main criterion for a branch is that a separate structural unit is registered without creating a separate legal entity. A branch or representative office is an integral part of the company and operates as part of the legal entity of the parent organization.
2. Powers of the branch manager . The official who is charged with the authority to manage a branch or representative office is approved by the parent company. That is, only a legal entity has the right to transfer/remove the powers of the head of a branch. The appointment of the head of the branch is formalized by an appropriate order, the powers of the official are reflected in a power of attorney certified by a notary.
3. Local acts regulating the activities of the branch . Separate structural units operate on the basis of regulations, procedures, instructions issued and approved by the legal entity (parent organization). In addition to local acts regulating the activities of the company in general, and the branch, among other things, a legal entity has the right to approve internal regulations regulating the activities of an exclusively separate division.

REGISTRATION WITH THE PFR AND FSS

If the Regulations stated that a separate division in Moscow will have its own balance sheet, separate current account and employees, the opening organization must be registered with the Pension Fund and the Social Insurance Fund. In the absence of such instructions in the Regulations, all deductions will go to funds located at the location of the parent organization.

To register, you will need the following documents to register a branch:

The procedure for registering a branch involves reviewing documents by the tax authority within five days.

The decision to create

A branch is created by a meeting of company participants, or by the sole owner of the company individually. As Article 5 of Law 14-FZ states, such a decision is made by no less than 2/3 of the total number of votes of the owners of the legal entity. Moreover, the norm even further clarifies that the Charter may provide for the need for a larger number to open a representative office or branch. That is, the figure of 2/3 is generally the minimum required by law.

The will of the company's participants aimed at forming a branch is recorded in the minutes of the meeting or the decision of the sole owner. The protocol (decision) reflects the name of the branch and its address. In addition, the participants (participant) are required to approve the regulations on the new separate division, as well as appoint a person responsible for submitting documents to the registration authority - that is, to the Federal Tax Service.

It would also be useful to prepare an order for the creation of a new division; it will be issued by the head of the company.

It is also worth noting that the Civil Code of the Russian Federation and the law on LLCs no longer require changing the Charter when creating a branch. It is enough just to enter information into the Unified State Register of Legal Entities. However, as we will see below, this path has its difficulties.

In addition, there is one more point that needs to be paid attention to. As a rule, the issue of opening a unit is discussed by the owners in advance, and the meeting itself only formally consolidates the decision already made. However, there are exceptions when the creation of a new branch occurs against the backdrop of fierce opposition from some of the company's owners.

A similar situation arises in corporate disputes. They, in turn, are resolved only in arbitration courts. (Resolution of the Arbitration Court of the Ural District in case No. A60-38046/2015 dated May 4, 2016)

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Therefore, we strongly recommend that owners first eliminate all contradictions between them and only then carry out structural changes. Otherwise, there is a high probability of getting bogged down in litigation.

Legal requirements

Based on Federal Law No. 14, each LLC has the right to open a representative office (branch) in another locality with subsequent reflection of information in the constituent and statutory papers of the enterprise.

In particular, it is required to indicate the location of opening and the selected type of activity.

It is important to understand that opening a branch in another city requires a transition from a simplified form of taxation. Therefore, when organizing a small department with 1-2 employees, it is better to create a separate division. Some companies use the opening of a representative office in another locality as an opportunity to switch from “simplified” to another form of tax payment.

As for the number of branches that an LLC can open, the parameter is not limited by law. This means that you can open any number of representative offices, which you can provide. But it is important to realize that the new branch is not only additional profit, but also increased responsibility.

Change of legal address

To change your legal address due to a move, you need to go through the following steps:

1. notification of the tax office about deregistration;
2. notification of the closure of the PF and Social Insurance Fund branches;
3. completing the registration procedure at a new location.

Please note that you should not delay in completing the described actions, as this may lead to penalties.

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LLC registration rules

During registration, you will need to fill out a special form in which you must indicate basic information regarding the registered legal entity, in particular its name and legal address. Remember that in addition to providing information about the location of the company, you will be required to submit documents confirming your right to use the premises located at the specified address.

In the future, the tax office can check whether the registered company is located at its legal address. If a violation is detected, the founder faces legal liability in the form of a fine, so it is better to provide information that is reliable and corresponds to reality.

Don't forget to pay the state fee. The absence of a receipt for payment may serve as grounds for refusal of registration.

Results

If you follow the procedure and go through all the stages sequentially, opening an LLC branch in another city takes no more than 45 days. The main thing is to approach the preparation of papers responsibly and visit a notary in advance to certify copies. If you don’t have time to deal with the registration process, you can turn to specialists. But in this case you need to be prepared for additional costs.

You can register an LLC in another city or region if the executive body of the company is located there. According to legislative norms, registration of an LLC is carried out at the place of residence of the executive body of the company, vested with the powers necessary to represent the company to third parties, and not at the place of residence of its founder/founders.

LLC is a fairly popular form of business organization, since the founders bear responsibility for the obligations of the company only in the amount of their contributions.

FEATURES OF BRANCHES OPERATION

The company may perform all or part of the functions of the parent organization, as well as the functions of a representative office.

In carrying out their activities, they:

• act only on behalf of the parent organization;
• Only the head office is responsible for the activities of the branch;
• legal action can only be brought against the parent company;
• a separate company has property, but it is not its owner;
• An individual company does not have its own balance sheet.