Transactions with real estate: what taxes landlords and sellers pay in 2017

01.07.2017 | Legal

Most of the costs when dealing with real estate go to the owner.

Most transactions with real estate in Ukraine prescribed for the payment of taxes and fees.

What taxes does the landlord pay?

Art. 170 of the Tax Code of Ukraine prescibes that the lessor must pay a quarterly 18% of the amount received income and 1.5% – military duty. The rate does not depend on what type of property is leased. According to Art. 164 of the Code of Ukraine on Administrative Offenses, for evasion from paying taxes, the lessor faces a fine in the amount of three to eight non-taxable minimum incomes of citizens. Since in 2017 this figure is 17 UAH, the fine will fluctuate from 51 to 136 UAH. In the case of a repeated offense throughout the year, the fine is increased to 10-15 non-taxable minimum incomes of citizens or 170-255 UAH. Of course fine do not free the lessor from unrealised taxation.

What taxes are paid by the seller of real estate?

When selling an apartment, house or land, the seller must pay a state fee of 1% of the price of the property. If the property was owned less than 3 years or the second sale in a year, the seller is additionally obliged to pay a personal income tax of 5%. When selling a commercial real estate property, the tax on personal income and military duty are paid on a mandatory basis, regardless of how long the property was owned.

For its part, when making the above transactions, the buyer must pay 1% for compulsory pension insurance.

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