What is definitely not taxed?
Before the 2014 changes to the Tax Code, this category of citizens was exempt from paying taxes on absolutely all real estate. It didn’t matter whether one or five apartments belonged to you. The amendments made changed the situation. The benefit for pensioners on personal property tax has been preserved. There is also no land tax for pensioners. But the list of objects to which tax exceptions apply has been significantly reduced.
So, people who have finished their working career due to age still pay various taxes. But with legislative reservations and exceptions that have the meaning of social protection. Article 407 of the Tax Code contains a complete list of objects from which pensioners are exempt from paying property taxes. To do this, two conditions must be met:
- The property is owned and the rights to it are duly registered (for example, the apartment is privatized, which is certified).
- The property is not used in any way in business activities and is not involved in economic turnover (for example, it is not rented out).
Are pensioners exempt from paying land tax? The legislator proposed an exhaustive list of property for which exemption can be issued. Tax benefits for land tax and property can be received by owners of:
- apartments and rooms;
- residential buildings;
- premises and structures used in professional creative activities;
- outbuildings with an area of no more than 50 square meters. meters on garden, country and other land plots;
- garages and parking spaces;
- land plots allocated for individual housing construction and summer cottages.
Important! Tax exemption can be obtained in respect of only one object of each type. Residual or inventory values are no longer used to calculate the retiree property tax benefit. The concept of cadastral valuation has been introduced into legislation. All calculations are carried out on its basis. It should be noted that the use of actual cost as a basis for calculating taxes significantly increased the amount of payments.
The cadastral value is determined by the state based on an independent assessment. In fact, this is the market value of the property. It takes into account the characteristics of its location, quality and consumer characteristics. A pensioner can choose objects for preferential taxation. For the rest, apply the right to tax deductions.
One type of property
There are a number of other nuances in the tax system for pensioners that should be kept in mind. If a person owns several properties of the same type at once, for example, two apartments, then he has the right not to pay property taxes for only one of these objects. He decides for himself which one to choose, but the fact remains that it will not be possible to get benefits for several houses or garages at once.
Read also: What taxes do you need to pay for the sale of an apartment from 2019
But if a pensioner owns several premises of different types, for example, an apartment, a country house and a garage, then he has the right to receive benefits for each of these objects. Many older people don’t even know that they can also get a tax break for garages, and this benefits the state, but not the owners themselves.
Currently, men can retire at the age of 60, and women at the age of 55, and the retirement age will not change in the near future. If a citizen of the Russian Federation has reached retirement age and is entitled to pension payments in accordance with current legislation, then he automatically receives the right to tax benefits.
But there is one important clarification - such benefits are of a declarative nature. In other words, don't wait for your local government to call you and tell you it's time to get a tax break. A person is obliged to contact the tax service himself and demand the abolition of property tax on the properties he has chosen.
The tax office itself will not deal with such issues and will calculate taxes in full, even if the taxpayer has already retired. Moreover, for non-payment he will be subject to penalties, and even subsequent filing of an application for tax benefits will not cancel them. Therefore, you need to deal with such issues in a timely manner if you do not want to pay more than the established norm.
If there are several apartments and plots
In this case, it will not be possible to exempt all real estate from taxes. The benefit will be provided to you at your choice. If you have not made a choice and have not formalized it in the application, the tax office itself will determine the objects with the largest annual payment amount. They will be granted exemption.
For the rest of the property, it makes sense to reduce the amounts transferred to the budget. To do this, you need to apply tax deductions. The latter are provided for all taxpayers:
- for rooms – 10 sq.m.;
- for apartments – 20 sq.m.;
- for private houses – 50 sq.m.
The deduction can be received for any number of apartments and houses.
Good to know. Even if you have only one house or one apartment, but its cost is above 300,000,000 rubles, you pay tax. In this case, the apartment tax benefit for pensioners does not apply. You remain a property tax payer even if you own commercial real estate.
Tax deduction for pensioners
Pensioners, as well as working citizens, have the right to a property (tax) deduction. It is provided in connection with the purchase and completion of construction of a house (apartment). This benefit can be realized by transferring it to the previous three years. This procedure is used to exercise the right to a deduction if it was not possible to use it during the period of employment.
The right to deduction arises at the time of receipt of the certificate of ownership. An equivalent document is the act of transfer of the construction project. It is used if an agreement on shared participation in construction has been concluded. Ideally, the property certificate will be obtained in the last year before retirement. Income for the previous three years can be fully used to refund the personal income tax paid. The maximum refund amount is 390,000 rubles, provided that the purchase of housing was carried out under a mortgage loan agreement. When using your own funds, the amount is reduced to 260,000 rubles.
Example: you bought an apartment and received registration documents for it in 2020, and completed your working career in 2020. You can submit an application for a property deduction in 2020, and the calculation of benefits will include income of only two years - 2020 and 2020. 2020 will be taken into account for benefits if you continued to work and were a personal income tax payer.
Important! Citizens registered as an individual entrepreneur or self-employed are not entitled to such a deduction. They are not payers of personal income tax.
When preparing documents to receive a deduction, you should remember the following restrictions:
- housing cannot be paid for by the employer;
- the apartment or house was not purchased using funds from a social program;
- the buyer and seller of residential real estate must not be related by family or employment.
The following documents are being prepared:
- application on a standard tax form;
- pension certificate;
- declaration in form 3-NDFL;
- certificate in form 2-NDFL;
- certificate of ownership of privileged property;
- contracts, bank statements, invoices confirming expenses incurred (contracts for finishing, receipts for the purchase of materials and equipment for the house/apartment).
When declaring income for the periods selected to receive a refund of paid personal income tax, do not forget about its additional accounting sources:
- proceeds from the sale and rental of property;
- additional non-state pension;
- wages (for workers).
If your income is not enough to fully compensate for the costs, part of them can be covered by filing a similar deduction for your spouse.
Former military
Employees of law enforcement agencies and the Ministry of Defense are payers of personal income tax. The state also provides them with the right to property offset. It can be implemented provided that the apartment was not purchased with the employer’s funds. In other cases, the procedure for returning funds is similar to civil pensioners.
How to get a benefit
Receiving a pension certificate does not automatically activate benefits. Exemption from property tax must be properly completed:
- an application is submitted to the tax authority. The application form is universal and is also used for concessions on land and transport taxes;
- the notification about the selected objects is filled in. It must indicate the property selected for applying the tax exemption or to replace the previously contributed one;
- Attached are documents for a house, apartment, etc. (copies), as well as a pension certificate (now, as a rule, it is enough to indicate its details).
If the application is not submitted by November 1 of the current year, then the provision of property tax benefits to pensioners is postponed. During this period, the Federal Tax Service will offer to pay taxes for a complete list of property. Recalculation will be available, but this can only be done next year. To do this, you will have to go through another procedure - after registering the benefit, submit an application for a refund of the overpaid tax. In this case, the citizen loses practically nothing except time and the consequences of inflation.
Note. It may happen that the benefit has been issued, but you have not chosen the benefited object yourself. The tax office will release the one for which a large amount was charged. Optimization will be carried out without your participation.
Who is entitled to receive it
Any working citizen has the right to submit an application to the tax office with a request to return part of the money spent to him if he purchased an apartment or paid for expensive treatment.
But a person has retired, he doesn’t work and doesn’t pay personal income tax - how can a pensioner get a tax deduction in such a situation? We know the rule: no tax, no deduction.
This depends on many reasons: how long has he been retired, whether he works or is going to start working again. Let's consider two main situations when buying a home.
