What Has Changed
Until 2026, an LLC director who was also the sole participant could avoid concluding an employment contract with themselves and therefore not accrue salary or insurance contributions if the company was inactive.
From 2026, the position of the Federal Tax Service and the Social Fund of Russia (SFR) has changed: a director who manages the company is considered to be in an employment relationship regardless of whether a written contract exists. This triggers the obligation to accrue insurance contributions.
Who This Affects
Directors at risk from the new rules include those who:
- are the sole employee of the LLC,
- manage a “dormant” company (no turnover, no other staff),
- sign documents, represent the company at a bank, with the tax authority, or conclude contracts — i.e. who are actively exercising management functions.
If the director is formally documented as “non-working” (no employment contract, no salary) but is carrying out management functions, auditors may reclassify their status and assess contributions for the entire preceding period.
How Much Must Be Paid
Insurance contributions in 2026 are calculated on the salary actually paid. The standard rate is 30% of payments up to the ceiling of the contribution base (unified single rate since 2023).
If the director’s salary is set at the statutory minimum wage (approximately 22,440 rubles per month in 2026), the monthly obligation is around 6,700 rubles, or approximately 80,000 rubles per year.
Additionally: occupational injury contributions (0.2–8.5% depending on the type of activity).
Can This Be Avoided
The only way to avoid contributions for a “dormant” company is to formally cease activities (liquidate the LLC) or place the company in genuine “suspended” status with documented confirmation that the director is carrying on no management activity.
If the director continues to take any action — signing accounts, opening bank accounts, filing applications — the contribution obligation arises.
An alternative: some directors consider transitioning from an employment contract to a management agreement with an individual entrepreneur entity. This option carries its own tax risks and requires careful consideration.
Practical Advice
If your company has been “asleep” for several years and you have no plans to develop it — liquidate it. The costs of liquidation (notary fees + state duty) are significantly lower than annual contributions for a dormant company plus penalties for late filings.
If the company is needed for future projects — properly document the “suspended activity” regime and file nil returns regularly.
Read Also
- VAT for Simplified-Tax-Regime Businesses: The Threshold May Drop to 20 Million Rubles
- Director Subsidiary Liability: 3 Mechanisms the Tax Authority Uses to Reach Personal Assets
Are you the director of a dormant LLC, or do you want to understand how to properly manage a pause in the company’s activity? Contact us for a consultation — we will help choose the optimal arrangement based on your tax exposure.