28.12.2014, Verkhovna Rada of Ukraine adopted the Law of Ukraine “On amendments to the Tax code of Ukraine and certain legislative acts of Ukraine regarding tax reform.” This law introduced significant changes to the taxation of residential and non-residential property from 01 January 2015.
The tax base is the total area of residential and non-residential property, including its share. Thus, the tax rate per 1 sq. m of total area of residential and non-residential property for individuals and legal entities is established in the amount not exceeding 2% of the minimum wage per year, or about 24,36 USD (minimum wage as of 1 January 2015 – 1218 UAH per month).
The law provides benefits for the payment of property tax for physical persons in particular, the tax base apartments is reduced by 60 square meters, the house is 120 sq m If you stay in the property tax payer different types of residential property tax base is reduced by 180 sq m.
Local councils can increase the marginal border of the residential property, which decreases the tax base, and to determine benefits tax on residential property for individuals depending on the level of income and wealth.That is, suppose that an individual owns two apartments in Kiev total total area of 250 square meters and a house in the village area of 25 sq m.
Under such conditions, guided PP) p. 266.4.1. Law, the tax base will be reduced to 180 sq m. that Is, the total area of 275 square meters subtract 180 square meters, we get 95 sq m. If there is only apartments base was decreased by 60 sq m. it is obvious that for taxpayers is best to have a house in the village”.
This reduction is provided once for each base of the tax (reporting) period (year).
Also from the point of view of tax optimization is an important legal prescription about the possibility of a village, settlement, city councils to increase the marginal border of the residential property, which decreases the tax base, prescribed by this subclause.
Additionally, the local government may provide additional benefits for the payment of tax on residential property for the persons with regard to their property status and income level. It is obvious that will be very beneficial to have a “house in the country” given the fact that the village head can contribute in tax optimization, as by increasing the size of the area Kotar not taxed, and by establishing additional benefits, for example, in the case of receiving the minimum wage.
Tax breaks for individuals are not available on the object of taxation, if its area exceeds five times the size of the free area, approved by the decision of local authorities, as well as objects of taxation that are used with the purpose of obtaining income.
Not subject to taxation building family-type orphanages, dormitories, residential property unfit for habitation, in particular, in connection with an emergency condition, as well as the house, which belongs to orphans, children deprived of parental care, disabled children who are brought up by single mothers (fathers), but not more than one such object on the child.
Is not subject to taxation non-residential property, which is used by the entities of small and medium businesses, which operate in small architectural forms (LFA) and markets; building industry, construction agricultural producers intended to be used directly in agricultural activities, as well as the residential and non-residential property owned by public organizations of disabled people and their enterprises.
For commercial property owners, this legal definition is very advantageous, since it does not contain any detail.
If you literally interpret the law, then we can conclude that the owners of the buildings, industry and agricultural production exemption tax.
For example, if a legal or natural person owns a warehouse, was leased for placement of the production of electrical appliances. Or premises private boilers producing heat energy for consumers. Whether in this case they are tax payers. And the price is considerable, because the area can be from 1,000 to 10,000 sq m.
The state Committee of Ukraine for standardization, Metrology and certification 17.08.2000, order No. 507 approved “State classification of buildings and structures”. DK BS is intended for use by authorities of Central and local Executive and legislative authorities, financial services, statistical agencies and all entities (origionality individuals) in Ukraine.
According to the code 1251 “Building industry” class includes: building enterprises of mechanical engineering and Metalworking industry, building enterprises ferrous metallurgy, building, chemical and petrochemical industry, building, light industry, building, food industry, building enterprises of medical and microbiological industry, building timber, woodworking and pulp and paper industry, building construction industry, construction materials and products, glass and porcelain industry, buildings other industries, including printing reservoirs, silos and warehouses.
According to the code 1271 “Buildings for agricultural purposes forestry and fisheries” class includes: buildings for use in agricultural activities, such as barns, stables, piggeries, sheep, horse mills, dog kennels, poultry farms, granaries, warehouses and small buildings, cellars, wineries, wine containers, greenhouses, agricultural silos and other buildings for livestock, buildings for poultry, a building for storing grain, silo building and snain, buildings for horticulture, viticulture and winemaking building greenhouses, buildings, fisheries, building enterprises in the forestry and farming buildings for agricultural purposes other.
No other legislative definitions and however you consider notions not, at the same time convinced that in court proper and admissible evidence in confirmation of the special status of real property – building industry and agricultural production.
Besides taking hastily tax changes, the updated composition of the legislator did not take into account a number of moments technique norm creation.
Namely, as is well known special local property taxes is that they by law cannot be set directly by the decision of the Verkhovna Rada of Ukraine.
Subclause 8.3. paragraph 8 of the Tax code of Ukraine stipulates that belong to the local taxes and charges imposed in accordance with the list and the limits rates prescribed by this Code, decisions of rural, town and city councils within their authority, and are required to be paid on the territory of the respective local communities.
That is the immediate establishment of local taxes (and therefore property tax and transport tax) related to the Tax code of the competence of the respective village, settlement, city councils within their powers.
Also pay attention to what the city Council did not accept and is not objectively able to accept and officially publish until 15 July 2014 decision about the establishment of new local taxes on real estate. After all, the budget code and budget periods, there has not been canceled.
So happy must decide when to take this tax, its size, and to give a direct interpretation and elaborate on the issues highlighted above. Consequently choosing the composition of city councils, now more than ever urban communities will feel the fairness, appropriateness and objectivity in the decisions of the tax of the parliamentary bodies and local levels.
The calculation of the amount of tax on real estate owned by individuals that carried out by the Supervisory authority at the place of registration of the property owner.
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