Features of legal regulation of the activities of self-employed individuals

Poluyan Dmitrii Anatol'evich ORCID: 0000-0003-4434-0923 Postgraduate student; Department of Commercial Law; Federal State Budgetary Educational Institution of Higher Education 'St. Petersburg State University' 196084, Russia, Saint Petersburg, Krasutsky str., 3, lit. M, sq. 237 gradualle@mail.ru Other publications by this author

In this article, we designate self-employed individuals who carry out entrepreneurial activities in accordance with the conditions established by law for carrying out such activities without state registration as an individual entrepreneur (paragraph 2, paragraph 1, Article 23, Part One of the Civil Code of the Russian Federation No. 51–FZ of November 30, 1994 (hereinafter referred to as the Civil Code of the Russian Federation)). The only legal condition for their activities to date is the application of the experimental tax regime "Professional Income Tax" (Part 6 of Article 2 of Federal Law No. 422-FZ of November 27, 2018 "On Conducting an experiment to establish a special tax regime "Professional Income Tax" (hereinafter referred to as Law No. 422–FZ).Federal Law)). In other words, the activities of the self-employed can only be implemented through and within the framework of the "Professional Income Tax" tax regime.

A specific form of legitimization of their activities, expressed in registration as a payer of professional income tax, distinguishes the self-employed from traditional merchants (individual entrepreneurs and commercial legal entities) by granting individuals the right to carry out business activities bypassing the usual registration procedures and the resulting regulatory features of their activities. Such features, first of all, are expressed in the fact that the requirements of the tax regime are also the requirements of the legal form of entrepreneurship. As a result, we are forced to consider the self-employed a priori and exclusively as subjects of ultra-small businesses, limited in hiring employees (paragraph 4, Part 2, Article 4 of Law No. 422-FZ), annual income (paragraph 8, Part 2, Article 4 of Law No. 422-FZ) and types of activities (Part 2, Article 4, Part 2 of art. 6 of Law No. 422-FZ). This raises a series of questions about the appropriate legal regime for their activities. On the one hand, they are entrepreneurs, as is systematically evidenced by legislation: the self-employed were included in Federal Law No. 209-FZ of July 24, 2007 "On the Development of Small and Medium-sized Businesses in the Russian Federation" as support entities, the self-employed are included among economic entities in Federal Law No. 26 of July 2006 135-FZ "On Protection of Competition", the right to become a payer of professional income tax corresponds to individual entrepreneurs who are well-known business entities, etc. On the other hand, they most often act alone and in extremely small amounts compared to other entrepreneurs, which is seen as the proximity of their activities to other active economic activities of citizens.

With regard to obligations arising from the business activities of the parties, the legislator establishes a special legal regime reflected in a number of norms of the Civil Code of the Russian Federation. Such norms include, in particular, provisions on an irrevocable power of attorney (Clause 1 of Article 188.1 of the Civil Code of the Russian Federation), on the right to unilaterally waive an obligation or change it for a fee (Clause 3 of Article 310 of the Civil Code of the Russian Federation), on the general impossibility of early fulfillment of business obligations (Article 315 of the Civil Code of the Russian Federation), on the accrual of complex interest (Clause 2 of Article 317.1 of the Civil Code of the Russian Federation), on the obligation and the subject of the pledge determined by the pledge (clause 2 of Article 339 of the Civil Code of the Russian Federation), etc.

These norms, according to paragraph 3, paragraph 1, Article 23 of the Civil Code of the Russian Federation, apply to relations related to entrepreneurial activities of individuals carried out without forming a legal entity, except in cases directly provided for by law, other regulations or arising from the substance of the legal relationship. In other words, if an individual is engaged in entrepreneurial activity, including when applying a tax on professional income, the rules governing entrepreneurial activity will apply to relations with his participation.

Meanwhile, referring to the small volume of activity of the self-employed, a number of scientists note the inexpediency of applying to them the full range of norms governing entrepreneurial activity. Article 401 of the Civil Code of the Russian Federation is most often referred to in this vein. So, A. G. Karapetov and A. A. Pavlov write: "Should consumer legislation really apply to contracts of citizens (employers) with self-employed nannies, and nannies should be strictly responsible for being late regardless of fault (Clause 3 of Article 401 of the Civil Code of the Russian Federation), like other merchants? It seems that this would be unfair" ^[1]. N. E. Savenko writes that equating the self-employed with other merchants within the framework of increased responsibility is unfair due to the different economic opportunities of these entities ^[2]. Yu.D. Zhukova and A. S. Podmarkova believe that in the absence of the self-employed potential to expand their commercial activities, the tightening of the in relation to them, the terms of liability for obligations are irrational ^[3]. A.V. Gabov believes that the application of art. 401 of the Civil Code of the Russian Federation "for cases of violation of the normal course of fulfillment of obligations, to which the self-employed and ordinary citizens are obligated, raises great doubts" ^[4].

On the one hand, it is difficult to disagree with this logic. The activities of the self-employed in many ways resemble non-profit or even work activities, which makes it reasonable to assume that it is incorrect to apply the requirements for a larger business to them. As D. V. Bondarenko notes, the self-employed justify a more lenient approach to themselves with small amounts of activity ^[5]. However, on the other hand, such arguments seem inconsistent within the framework of private law regulation, which implies the interaction of subjects equal to each other (paragraph 1 of Article 1 of the Civil Code of the Russian Federation). It would seem that if we make allowances for an entity that is legally limited in its market opportunities, then we should do the same for individuals who, although they have a different organizational and legal form that allows them to scale their business, actually carry out an extremely small amount of commercial activity. However, this is not happening.

The self–employed are individuals who independently assume obligations, while acting as a special entity authorized to conduct business activities - a payer of professional income tax. This status not only reflects the essence of their activities, but also informs counterparties that the concluded transactions will be faithfully and responsibly executed by a special business entity — an entrepreneur. Otherwise, the latter will face increased responsibility, which is institutionalized for all merchants, regardless of the volume of their activities, which helps to increase trust in the market, makes turnover safer and more predictable, including for other entrepreneurs.

Reducing the level of responsibility of the self-employed will inevitably reduce the effectiveness of regulation of this category of citizens as entrepreneurs, devalue it, primarily reducing the attractiveness of the self-employed as contractors and performers.

However, as Yu.D. Zhukova and A. S. Podmarkova correctly pointed out, there is an incomplete willingness in law enforcement and science to directly identify the self-employed with entrepreneurs with all the ensuing consequences ^[3], which, in our opinion, is evidenced by the above-mentioned points of view of scientists on reducing the responsibility of the self-employed. Also, in a number of monographic studies, the authors question the entrepreneurial nature of the self-employed ^{[6, 7, 8]}.

In this context, it is interesting to note the inconsistent approach of the legislator in that he does not directly refer to self-employed entrepreneurs, although he indicates that they carry out entrepreneurial activities, which is why the problem of uncertainty of their entrepreneurial status often arises in the literature and in practice. This problem is also aggravated by the fact that the legislator, by providing the self-employed with accessible and simple procedures for registration, accounting for transactions and payment of professional income tax, has made implicit the legal consequences that occur when registering as a payer of professional income tax. In other words, many self-employed people do not realize that they are becoming entrepreneurs.

In judicial practice, this manifests itself in two aspects. Firstly, many self-employed people mistakenly believe that registration as a payer of professional income tax does not exclude the right to unemployment benefits, which leads to the self-employed being held accountable for illegally receiving such benefits (Decision of the Novo-Savinovsky District Court of Kazan, Republic of Tatarstan, dated December 10, 2024 in case No. 2-6428/2024, The decision of the Zavyalovsky District Court of the Altai Territory dated December 10, 2024 in case No. 2-287/2024, the Decision of the Leninsky District Court of Komsomolsk-on-Amur, Khabarovsk Territory dated June 06, 2024 in case No. 2-771/2024). The Constitutional Court of the Russian Federation also confirmed the impossibility of receiving unemployment benefits for the self-employed even if the latter does not have an income (Ruling No. 327-O dated February 27, 2024).

Secondly, some of the self-employed dispute the application of legislation regulating entrepreneurial activity to them, in particular the Law of the Russian Federation of February 7, 1992, No. 2300-I "On Consumer Rights Protection". The courts refute this position and apply the above-mentioned law to transactions involving the self-employed (the decision of the Tutaevsky City Court of the Yaroslavl region of February 14, 2023 in case No. 2-87/2023, the Ruling of the Oktyabrsky District Court of Vladimir of the Vladimir region of December 20, 2023 in case No. 2-3497/2023, the Appellate ruling of the IC for Civil Cases of the Rostov Regional Court of December 18, 2024 in case No. 33-20331).

To solve this problem, it is necessary to more explicitly define the entrepreneurial nature of the self-employed. This can be achieved, firstly, by supplementing Article 2 of Law No. 422-FZ with Part 6.1 as follows: "The activities of individuals under a special tax regime, the income from which is taxed on professional income, is considered entrepreneurial," and, secondly, by renaming the tax regime itself.

The current name of the tax regime does not reflect the essence of the activities of its payers, rather, on the contrary, it distorts it, mixing the activities of the self-employed with the category of professional activity. Thus, O. A. Tarasenko in his article comes to the conclusion that the qualification of the self-employed as a professional, income-generating activity is the most correct, justifying this by the fact that Law No. 422-FZ applies a sign of professionalism to the activities of payers ^[9]. However, as A.V. Serova correctly points out, the use of the concept of "professional activity" in this case is problematic, since this leads to confusion of this term with such a concept of labor law as "profession", as well as with professional activity, which, in accordance with federal laws, is subject to state registration and (or) licensing ^[10]. At the same time, it should be noted that professionalism, according to the text of Law No. 422-FZ, is a sign of income, not of the payers' activities.

Considering the above, R. M. Boziev, also questioning the professional nature of the income of taxpayers of the tax regime, considers a more appropriate name for the tax regime to be "The taxation system for the self-employed" ^[11].

In connection with the presented issues, we consider the most appropriate name for the tax regime to be "Small Business Income Tax". We cannot deny that this name is imperfect in many aspects, but it reflects the main characteristics of the professional income tax.:

1. Focus on income as an object of taxation;
2. Emphasizing the scope of activities limited by the requirements for the taxpayer (art. 4 of Law No. 422-FZ) and the object of taxation (art. 6 of Law No. 422-FZ);
3. The entrepreneurial nature of the activities of professional income tax payers.

The use of this name will not only avoid confusion with categories of professional activity, giving false qualifications to tax payers, but also make the entrepreneurial nature of activities within the framework of the tax regime clearer and more defined, as we noted earlier. Accordingly, this change in the text of the law requires replacing the category of "professional income" with "small business income."

Returning to the main topic of the study, it should be noted that legislative techniques aimed at preventing ambiguous interpretation of civil law norms often include in the text of the norm, instead of specifying the conduct of entrepreneurial activity by participants, a direct indication of the type of legal form of a merchant, in particular, an individual entrepreneur, although the very essence of regulated relations implies the participation of entrepreneurs in them, regardless of it depends on their organizational and legal form. The question arises, is it possible to apply these standards to the self-employed?

Modern legal regulation is characterized by a gradual expansion of the boundaries of the application of norms governing entrepreneurial legal relations to self-employed citizens, ensuring the full participation of the latter in economic turnover as entrepreneurs and on an equal basis with other entrepreneurs. In the above-mentioned cases, this is achieved either by including the self-employed in a number of business entities specified in the text of the norm, as, for example, in the case of the inclusion by Federal Law No. 344-FZ of October 14, 2024 "On Amendments to the Federal Law "On Protection of Competition" of individuals who are not registered as an individual entrepreneur, However, those applying the special tax regime "Professional Income Tax" are included in the list of business entities in Federal Law No. 135-FZ of July 26, 2006 "On Protection of Competition". Or by excluding the requirement for a specific legal form of the subject of the relationship. An example of this is the invalidation of Article 1478 of the Civil Code of the Russian Federation (Federal Law No. 193-FZ of June 28, 2022 "On Amendments to Part Four of the Civil Code of the Russian Federation"). As follows from the explanatory note to the relevant draft law, the amendment to Article 1478 of the Civil Code of the Russian Federation was motivated by the need to eliminate discrimination in civil law regulation. The previous version of the article granted the right to trademark registration exclusively to legal entities and individual entrepreneurs, thereby unreasonably limiting the entrepreneurial opportunities of the self-employed. The exclusion of the above-mentioned article from the text of the Code was aimed at eliminating this inequality and ensuring equal rights for the self-employed in the field of intellectual property. With such changes, legislation is gradually integrating the self-employed into private and public law mechanisms for regulating entrepreneurial activity.

At the same time, a number of rules governing entrepreneurial activity cannot be applied to self-employed citizens due to the limitations of Law No. 422-FZ. Thus, it is impractical to allow the participation of the self-employed as trust managers (Clause 1, Article 1015 of the Civil Code of the Russian Federation) or parties to a simple partnership agreement (Clause 2, Article 1041 of the Civil Code of the Russian Federation), since income from such activities is not subject to taxation of professional income tax (Clause 7, Part 2, Article 6 of Law No. 422-FZ), in other words In other words, they cannot be the content of the entrepreneurial activity of the self-employed.

Due to the conflict nature and complexity of the emerging relationships, special attention in this topic deserves an analysis of the applicability of the rules on the insolvency (bankruptcy) of individual entrepreneurs to the self-employed. The presence in the legislation of special norms regulating the bankruptcy of individual entrepreneurs (paragraph 2 of Chapter 10 of Federal Law No. 127-FZ dated October 26, 2002 "On Insolvency (Bankruptcy)" (hereinafter referred to as the Bankruptcy Law)) is due to the involvement of these entities in commercial relations, which are characterized by a plurality of creditors, a complex debt structure and significant amounts of debts, in this regard, the application of special rules to these entities outside the general bankruptcy procedure of citizens is designed to regulate public relations that are important from the point of view of restoring economic turnover after the onset of unfavorable and destructive economic insolvency of the merchant. Therefore, in particular, property intended for the entrepreneurial activity of individual entrepreneurs, as well as citizens who have ceased to operate as an individual entrepreneur, but whose monetary obligations and (or) obligation to pay mandatory payments arose as a result of their entrepreneurial activity, is sold in the same manner as the property of legal entities (paragraph 213.1 of the Bankruptcy Law), which allows for its objective assessment and a higher sale price to cover more debts and minimize the damage that the bankruptcy of an entrepreneur causes to its partners, consumers and the financial system of the state as a whole.

In turn, the activities of the self-employed have a number of limitations that constrain their commercial potential, as a result of which the possible damage from bankruptcy of the self-employed to its counterparties will be objectively lower than that of the average individual entrepreneur. At the same time, the self-employed, carrying out entrepreneurial activities, can use various expensive equipment and tools (for example, numerically controlled grinding machines, temperature-controlled soldering stations, 3D printers, etc.). It is better to evaluate and sell this property in accordance with the procedure provided for the property of legal entities, ensuring its objective professional evaluation and sale at auction, which will have a positive impact on the sale price. The opposite may negatively affect the completeness of satisfaction of creditors' claims. Thus, it would be advisable to include the self-employed in clause 4 of Article 213.1 of the Bankruptcy Law as entities whose property intended for entrepreneurial activity is subject to sale in accordance with the procedure established for the sale of property of legal entities.

The recognition of an individual entrepreneur as bankrupt is also distinguished by special consequences, expressed in the termination of the status of an individual entrepreneur and an additional limitation of his legal capacity. Thus, from the moment the court makes a decision to declare an individual entrepreneur bankrupt and to introduce a procedure for the sale of a citizen's property, the state registration of a citizen as an individual entrepreneur becomes invalid (paragraph 1 of Article 216 of the Bankruptcy Law, paragraph 10 of Article 22.3 of Federal Law No. 129-FZ dated 08.08.2001 "On State Registration of Legal Entities and Individual Entrepreneurs" (next is the Law on State Registration)). The re-registration of a citizen as an individual entrepreneur cannot be carried out for the entire time while the sale of property is ongoing, as well as for 5 years from the date of completion of the property sale procedure or termination of bankruptcy proceedings during such a procedure (paragraph 4 of Article 216 of the Bankruptcy Law, paragraph 4 of Article 22.1 of the Law on State Registration). The debtor may also not hold positions in the management bodies of a non-credit organization for 5 years and in a credit organization for 10 years (clause 4 of Article 216 of the Bankruptcy Law).

Termination of the status of an individual entrepreneur and a ban on its re-registration perform a protective function for civil turnover. Firstly, they protect commercial turnover from people who have failed to create a successful enterprise, have not shown a sufficient level of financial literacy and risk preparedness. Secondly, the diminution of property in connection with its sale increases the likelihood of new debts, therefore, providing a citizen with time to restore financial well-being before resuming entrepreneurial activity seems reasonable. The application of similar measures to the self-employed is justified, since it will protect both themselves and other subjects from the possible adverse economic consequences of the insolvency of the self-employed.

At the same time, the restrictions imposed on individual entrepreneurs may seem too harsh and even unfairly cruel if they are applied to the self-employed. A five-year ban on holding a position in the management bodies of a non-credit organization can hardly be considered commensurate with the economic risk of insolvency of a self-employed person.

In this context, it should be noted that the institution of bankruptcy plays a particularly significant role in relation to debtors. Bankruptcy, realizing the concept of a "new start" ^[12], allows a citizen to get rid of debts, thereby socially rehabilitating him and giving him a chance to build a better future. Developing a similar idea, I. V. Yershova, T. P. Shishmareva, and E. E. Yenkova propose to provide for the self-employed special legal consequences of bankruptcy, different from commercial ones, which include the possibility for the self-employed to continue their activities after bankruptcy proceedings ^[13]. In turn, we propose to achieve the same thing not by creating a special bankruptcy procedure for the self-employed, but by optionally applying the rules governing the bankruptcy of individual entrepreneurs to them. In other words, the provisions of paragraph 4 of Article 216 of the Bankruptcy Law should apply to the self-employed only if the court finds that the main cause of bankruptcy was precisely the debtor's entrepreneurial activity.

In conclusion, it should be noted that the legal status of the self-employed is characterized by a marked uncertainty about the commercial content of their activities, despite the explicit indication of the entrepreneurial nature of the legislation, the negative consequences of which can be found in judicial practice. The name of the tax regime "Professional Income Tax", which inaccurately reflects the essence of the activities of tax payers, aggravates the situation by confusing the activities of the self-employed with the concept of "professional activity". The above, combined with the extremely small volume of activity of the self-employed, raises multiple questions about the appropriate regime for regulating the activities of self-employed citizens.

We believe that the norms governing the activities of other entrepreneurs should be extended to the activities of the self-employed, thereby ensuring equal participation in economic relations for the former. At the same time, it is necessary to adhere to a cautious approach, firstly, taking into account the existing regulatory restrictions on the activities of the self-employed within the framework of the application of the professional income tax, and secondly, estimating the volume of activities of the self-employed, which do not allow them to fully participate in certain types of economic relations. At the same time, when considering the application to the self-employed of certain norms governing entrepreneurial activity, regardless of the legislative technique used in them, it is necessary to adhere to a cautious approach, firstly, taking into account the existing regulatory restrictions on the activities of the self-employed within the framework of the application of the professional income tax, and secondly, estimating the volume of activities of the self-employed, not allowing him to fully participate in certain types of economic relations. Thus, the self-employed were naturally not included in the list of manufacturers of high-tech products in Federal Law No. 523-FZ of December 28, 2024 "On Technological Policy in the Russian Federation and on Amendments to Certain Legislative Acts of the Russian Federation", since in the absence of employees and limited incomes they simply will not be able to compete equally for investments with individual entrepreneurs. and legal entities.

Also, in order to achieve legal certainty, it is necessary to more clearly define the entrepreneurial nature of the self-employed in legislation. In this regard, we propose to supplement Article 2 of Law No. 422-FZ and rename the tax regime to the "Tax on small business Income", which more accurately reflects the essence of the activities of the self-employed.