Immovable property
Last reviewed 21 Aug 2023
Tax depreciation
Straight-line
Immovable are included in I group of fixed assets for tax depreciation purposes. Straight-line method is applied
Additional
N/A
Depreciation categories
Land
No depreciation
Buildings
2,5 % as of activation moment
Tax base for buildings
Acquisition costs
Special depreciation
N/A
Write-ups
Not allowed for tax purposes
Real estate income tax
Object of taxation
Capital gains from the sale of real estate by individuals and companies.
Tax rate
15%
Tax collection
The taxpayer is obligated to calculate, report and pay capital gain tax
Exemptions
For individuals that invest the gained funds with in a prescribed period for purchase of real estate for housing of the taxpayer and members of his family.
For the sale of real estate that had been in possession of individuals for at least 10 years prior to the sale continuously.
Property transfer tax
Object of taxation
Transfer with consideration of (if transfers are not subject to VAT):
- ownership over immovable,
- rights of use over construction land,
- rights to permanent use of a parking space in an open apartment block or apartment complex.
- rent of construction land in public ownership for a period longer than 1 year or for an indefinite time period for the purpose of constructing buildings
Basis of assessment
The basis of assessment is agreed sale price, which may be reassessed by the Tax Authorities if it is below market level
Tax rate
2.5 %
Property tax
Objects of taxation
- Ownership right over immovable property (buildings and land larger than 10 acres) of companies and individuals;
- Right of occupancy
- Tenancy right (in accordance with the specific regulations) for a period longer than one year or for an indefinite period
- Right of usage for construction land larger than 10 acres in area
- Right of usage of state-owned immovable
- Occupancy of the immovable for which the owner is unknown or undetermined
- Occupancy of the state-owned immovable without legal ground (sine causa occupancy);
- Occupancy or right of usage of the immovable based on financial lease agreement
Basis for taxation is market value per m2 determined by the local authorities (or net book value as of 31 December of previous year in certain cases or in case when immovable is recorded at fair value in the books of a taxpayer).
Tax rate - companies pay property tax at the rate of up to 0.4 % (the exact rate is determined by the local municipality). Individuals pay property tax with progressive rates.
Real estate funds
Owner of the fund assets
No specific rules
Annual valuation
No specific rules
Borrowing
No specific rules
Diversification of risk
No specific rules
Tax liability
No specific rules
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