Property tax for individuals: who is entitled to a benefit?

Individuals who own residential premises - apartments, dachas, houses, as well as non-residential real estate (for example, a garage) - are payers of property tax. Payment of this tax is made on the basis of a receipt with a calculation, which inspectors of the Federal Tax Service send to the taxpayers' registration addresses at the end of the year. The calculation itself is made on the basis of the provisions of the Tax Code and acts of regional legislation. However, the law may also provide for property tax benefits for certain categories of citizens.

Tax benefits for the property of individuals under the Tax Code of the Russian Federation

The Tax Code offers property tax benefits to pensioners, disabled people, military personnel, family members of military personnel who have lost their breadwinner, heroes of the Soviet Union and the Russian Federation, as well as a number of other categories of payers. A complete list of those who are exempt from paying property tax for individuals at the federal level is presented in paragraph 1 of Article 407 of the Code.

Such citizens may not pay property tax on one object of each type out of all those that they own. In practice, this means that if a benefit recipient owns, for example, several apartments, then the exemption from personal property tax applies to only one of them. And vice versa, if we are talking about different types of real estate, then an individual can take advantage of two or more benefits at once: for example, pensioners can be exempt from paying property tax on an apartment and a dacha.

The right to a benefit is certified by a special application, which the taxpayer must submit to the Federal Tax Service before November 1 of the year in which the claimed benefit begins to be applied for the first time. There will be no need to duplicate this application in the future. Documents confirming your right to tax benefits can be attached to your initial application. However, this is only a right and not an obligation of an individual, although such documents will certainly make the task of controllers easier. The latter, even in the absence of documents proving the right to benefits, are obliged to independently request all the necessary information based on the information provided in the application of the potential beneficiary. Organizations, bodies and officials with the necessary data are involved in this.

Fundamental point: the property subject to the benefit should not be used as part of business activities. Simply put, if the apartment is rented out, then the benefit is not entitled to it.

And finally, two specific tax benefits for the property of individuals, which do not depend on the status of the taxpayer himself, but are rather related to the specifics of the object. Real estate objects such as studios, workshops, ateliers, in short, specially equipped premises in which their owners are engaged in professional creative activities, are not subject to tax. And secondly: various outbuildings up to 50 square meters located on land plots intended for farming, gardening or truck farming, or individual housing construction are not subject to property tax.

Individuals must pay real estate and land tax by November 15

“Just a few years ago there were a little more than 100,000 of them. That is, in about five years there was an increase of approximately twofold,” noted Michal Rassolko. – By the way, if a person has two residential premises in apartment buildings, it is his right to choose which of them to pay tax on. To do this, you need to contact the tax authority.

This year a new edition of the Tax Code came into force. In general, neither rates nor benefits have changed. Innovations affected buildings and land plots that were used for other purposes. The right of local councils to increase rates on ineffective or unused real estate by up to 10 times has been abolished. The tenfold increasing coefficient has also been abolished in relation to land plots that were provided for temporary use and were not returned in a timely manner or were occupied without permission. Also, for the regional and Minsk city Councils of Deputies, limits have been established for increasing the rates of real estate and land tax. For 2020, the maximum size is 2.5 times, and from 2020 onwards – no more than 2 times. Experts note: a decrease in coefficients will also be reflected in the amount of taxes that will be presented for payment.

We recommend reading: What is the amount of child support for one child in 2020 in Russia

Local benefits for personal property tax

In addition to the above cases where property tax benefits are provided at the federal level, there are options for local benefits established by regional law. Moreover, sometimes local legislative acts clarify the situations of providing benefits prescribed in the Tax Code, and sometimes they are a kind of addition.

For example, Moscow City Law No. 51 of November 19, 2014 “On the property tax of individuals” provides that beneficiaries from the above-mentioned paragraph 1 of Article 407 of the Tax Code have the right to zero property tax on a parking space or garage with an area of ​​up to 25 square meters.

The St. Petersburg Law on Property Tax (Law of St. Petersburg dated November 26, 2014 No. 643-109) provides benefits to children without parental care and orphans, including adults. It is valid during their stay in a boarding school or other similar institution, as well as during their service in the Russian army.

A complete list of benefits, as well as local property tax laws, can be found ]]>on the Federal Tax Service website]]>. On it, in a convenient form, you can familiarize yourself with regional legislation relating to both exemptions from property taxes for individuals and benefits for property taxes for organizations.

Who is entitled to property benefits

In 2014, amendments were made to the Tax Code of the Russian Federation, which significantly changed the procedure for pensioners receiving government support measures.

Now only pensioners and disabled people who comply with the following conditions can count on exemption from regular payment of property tax:

1. The property is his property;
2. The property is not used for business activities.

Moreover, receiving such assistance from the state is possible only for one piece of real estate.

If a person who is included in the preferential category of citizens has two apartments, then exemption from paying funds to the treasury is possible only in relation to one of them.

Such measures of assistance from the state for individuals are provided only upon application from citizens. They are not automatically assigned; the owner must independently select an object that is not subject to fees and document his right to receive this measure of support from the state.

Tax benefits for corporate property tax

Not only individuals, but also organizations can take advantage of the right to property tax benefits. Of course, for legal entities there is a different procedure for providing benefits, but the general principle is somewhat similar: some benefits are provided based on the status of the taxpayer organization itself, while others apply to property of a certain type.

Thus, according to Article 381 of the Tax Code, for example, organizations of the penal system, bar associations, law offices and legal consultations, religious organizations, and all-Russian organizations of disabled people do not pay property tax.

Of course, in the case of organizations, it is necessary to focus not only on federal, but also on regional legislation. It is also important to remember the need to file a property tax return: regardless of whether a legal entity falls under the exemption or not, it is obliged to report to the Federal Tax Service in any case.

The benefits applied are indicated separately in the declaration using special codes. Their full list is given in Appendix No. 6 to the Order of the Federal Tax Service of Russia dated March 31, 2020 No. ММВ-7-21 / [email protected] , which approved the current form of the declaration for the property tax of organizations. Thus, code 2010257 is a property tax benefit in respect of movable objects registered as fixed assets from January 1, 2013, unless such fixed assets were received as a result of the reorganization or liquidation of another organization or from an interdependent person.

Code 2010333 corresponds to a benefit extended to the property of state research centers. Codes 2012400 and 2012500 are provided for cases established by the laws of constituent entities of the Russian Federation of lowering the tax rate for a certain category of taxpayers and reducing the amount of tax payable to the budget, respectively.

Who gets the tax benefit?

The categories of citizens entitled to benefits are indicated in Art. 407 Tax Code of the Russian Federation:

• Heroes of the Soviet Union and Heroes of the Russian Federation, as well as persons awarded the Order of Glory of three degrees;
• disabled people of groups I and II;
• disabled since childhood;
• participants in the Civil War and the Great Patriotic War, as well as other military operations to defend the USSR as part of the regular army and partisan detachments, combat veterans;
• civilian personnel of the Soviet Army, Navy, internal affairs and state security bodies who held regular positions in military units, headquarters and institutions that were part of the active army during the Great Patriotic War, or persons who were in cities during this period, participation in the defense of which these persons are counted towards their length of service for the purpose of granting a pension on preferential terms established for military personnel of active army units;
• victims of radiation as a result of the disaster at the Chernobyl nuclear power plant, the Mayak production association, the discharge of radioactive waste into the Techa river and nuclear tests at the Semipalatinsk test site;
• military personnel, as well as citizens discharged from military service and having a total duration of military service of 20 years or more;
• persons who were directly involved as part of special risk units in testing nuclear and thermonuclear weapons, eliminating accidents of nuclear installations at weapons and military facilities;
• family members of military personnel who have lost their breadwinner;
• pensioners receiving pensions assigned in the manner established by pension legislation, as well as persons who have reached the ages of 60 and 55 years (men and women, respectively), who, in accordance with the legislation of the Russian Federation, are paid a monthly lifelong allowance;
• citizens discharged from military service or called up for military training who performed international duty in Afghanistan and other countries in which hostilities took place;
• individuals who received or suffered radiation sickness or became disabled as a result of tests, exercises and other work related to any types of nuclear installations, including nuclear weapons and space technology;
• parents and spouses of military personnel and government employees killed in the line of duty;
• individuals carrying out professional creative activities - in relation to specially equipped premises, structures used by them exclusively as creative workshops, ateliers, studios, as well as residential premises used to organize non-state museums, galleries, libraries open to the public - for the period such use;
• individuals - in relation to economic buildings or structures, the area of ​​each of which does not exceed 50 square meters and which are located on land plots provided for personal subsidiary farming, dacha farming, vegetable gardening, horticulture or individual housing construction.

How can spouses get a double tax deduction for the purchase of an apartment?

Be sure to join our communities on social networks: VKONTAKTE, FACEBOOK, Odnoklassniki.

Regarding military personnel

Land plots and some types of discounts are available to those military personnel who have served for 10 years or more. The more experience you have in this area, the greater the discounts.

The following categories of military personnel are entitled to a reduction in fees:

1. Members of military formations, if the formations operate on a legislative basis.
2. Specialists from communications departments.
3. Military from the state security, civil defense.
4. Civil servants from the Ministry of Emergency Situations, railway transport services, road construction workers, engineers.
5. Employees from internal and border troops.
6. Military personnel assigned to various types of troops in the Russian Federation.
7. FSB officers.

Citizens who serve under a contract at the time of filing applications are completely exempt from property taxes. You must select one property to which the discount will apply.

Reasons

Property tax benefits in 2020 are provided to:

• pensioners;
• disabled people;
• military personnel of the Russian Armed Forces;
• members of fallen military personnel;
• due to the loss of a breadwinner;
• heroes of Russia and the USSR.

The benefit can only be obtained for one property. In this case, you can independently choose the object to release.

For example, there are 2 apartments, the cost of which is:

• the first is 3 million rubles;
• the second – 5 million.

In this case, the optimal solution would be to get a benefit for the second property, since its tax will be an order of magnitude higher.

The basis for granting the required benefit is considered to be a properly drawn up application, which must be submitted with an accompanying package of documents to the territorial tax office.

The taxable object falling under the benefit should not be used by beneficiaries for commercial purposes. For example, it cannot be rented out to generate income.

How to apply for a benefit

To receive a pensioner's property tax benefit, the applicant must submit the appropriate documents for the provision of a state assistance measure to the tax office. The application must be accompanied by documents confirming the right of the beneficiary to receive such an exemption from paying taxes:

1. Notification to the Federal Tax Service;
2. Documents confirming ownership of real estate;
3. A copy of the pension certificate.

In order to receive a benefit for a specific property, a pensioner must submit a corresponding application to the tax authority. The Tax Code establishes a rule that the provision of all documents to receive state support is possible only before November 1 of the current year. After this period, the application is accepted.

After this date, it will be impossible to change the real estate to which the benefit applies. If a citizen does not choose a certain property at all, then the tax authority will make this choice for him.

In this case, the real estate object for which the largest fee is assigned will be exempt from taxation. That is, by refusing to make a decision on their own, the pensioner will not lose anything.

This tax benefit is available to both working pensioners and persons who have given up further work.