Tax on the sale of an apartment: features of the calculation, requirements and recommendations

The tax on the sale of an apartment is paid by the seller with the money received from the sale of real estate. The fiscal fee is thirteen percent. Two years ago, tax was paid on the sale of an apartment owned less than three years. The tax was not dependent on the cadastral value of the property. Since then, very important legislative changes have occurred that affect almost all residents of the country.

The updated version of the law establishes a different time frame than before, for people who can not pay fees, and introduced amendments that determine how much of the sale of the apartment is taxed. The most significant change that has occurred in the field of taxation of funds received during the sale of residential real estate is associated with the replacement of the estimated base from the inventory value to the cadastral value of the real estate.

The tax rate on the sale of an apartment is not adjusted, it remains thirteen percent. However, the shortest period of use of real estate will change, at which it is not necessary to pay this fiscal fee. Two years ago, owning property over a period of three years was enough not to pay tax. After innovations, you must own property for at least five years, and then an individual will be exempt from paying tax. The entry into force of the new law marked not only legal changes, but also financial ones: the size of the tax increased significantly. All of the taxes on the apartment and other changes in the law will be described below.

The most important innovation

The introduction of the change in question began three years ago. It continues to this day and will continue for a long time. On the way to one hundred percent establishment of the calculation of tax on the cadastral value of real estate there is a problem consisting in a significant difference between the value of the inventory and cadastral object. The price of the inventory practically does not coincide with the market estimate, it is very high. Inventory value hardly reaches up to a fraction of the value of an object according to market valuation.

The legislature is trying to stop illegal activities in the field of real estate sales through this innovation. Speculators and criminals will no longer have the opportunity to deliberately reduce the value of real estate, given how much of the sale of the apartment is taxed now. When the law was based on the value according to the inventory, it was quite possible and easy to do. Now the circumstances of the sale are different. The value of the fiscal fee is calculated at market value.

However, the innovation that determines what tax on the sale of an apartment in the property is paid has caused other problems:

• Difficulty in the sale of housing, requiring investment for repairs.
• Problematic selling when property owners are forced to reduce the cost of housing, due to any family problems, in order to sell it faster for income.

A full transition to value, according to the inventory, in all regions of the country should take place in two years. Now the process is at an intermediate stage. It is assumed that, along with its course, legislative structures monitor various obstacles in the application of innovations and take measures to improve them. In four years of legislative changes, much has already been done. During this time period, many regions were able to switch to the cadastral value of housing regarding what tax on the sale of an apartment is paid. However, many subjects of the country still continue to fully or partially calculate the tax at the cost according to the inventory.

Due to the transition to cadastral valuation:

• Events related to speculative (illegal) resale of housing are regulated.
• The influx of finances into the state treasury is increasing, because the cadastral value of housing is almost the same as that in the real estate market. The nullification of all illegal housing sales schemes on the one hand will have a very positive effect on the general situation in the country.
• The welfare of the citizens of the country is reduced, because the owners are forced to pay a large amount of funds to the treasury, which negatively affects their welfare.

The required tax charge requires citizens of the country, property owners, a certain discipline

After the sale of residential real estate, residents of the country receive a notification from the tax inspectorate with information about what tax on the sale of an apartment in property is eligible for payment. If the citizen does not receive a notification, he needs to independently resolve the issue of obtaining payment details, since the absence of a letter from the tax does not relieve the taxpayer of liability for non-payment and fines.

Who pays tax when selling an apartment?

One of the most exciting issues for citizens of our country has always been the problems associated with taxation of taxpayers with fiscal fees in favor of the state budget. People, in order to avoid making economic miscalculations, want to increase their financial literacy and find out what taxes to pay when selling / buying an apartment. In particular, they are concerned about tax fees associated with the sale of real estate, which have recently undergone major changes related to the time of ownership, settlement base and other input data.

The tax is levied on the income (profit) received after the sale of a residential property of any kind (apartment, house, room). The seller always pays the fee. Often citizens are interested in what tax is taken from the sale of an apartment or any other real estate? The rate is thirteen percent of the cost. It is worth saying that the collection is not subject to the total value of the property, but only the part that increased during the tenure. An example is as follows:

• the cost of acquiring housing is eight million;
• selling price - ten million;
• object tax - thirteen percent of the difference between the purchase price and the amount sold.

How to reduce tax?

Taxes and expenses on the purchase and sale of real estate can be reduced legally by reducing revenues on expenses actually incurred:

• The cost of the initial purchase of an apartment. This amount is allowed to reduce profits from the sale of the object. Expenses necessarily require documentary confirmation (statements on the transfer of money made through a commercial bank; receipts from individuals; receipts confirming the costs of repairing a residential property (purchase of construction materials, payment for workers' services).
• Costs associated with the construction of housing, the purchase of a house or a share in a property, land.
• Payments of interest on a loan or a loan taken to buy real estate or construction of an object. The amount may not exceed two million. This type of deduction is given once to the taxpayer in life.

Where and what tax is paid on the sale of an apartment?

To transfer the fiscal fee, the seller performs the following actions:

• fills out a declaration;
• submits it to the tax office in person or sends it by registered mail by mail;
• Receives a receipt
• pays a fee at a branch of a commercial bank.

What tax is levied on the sale of an apartment if the owner is a child? Parents pay cash for a minor.

The tax return is not filed:

• When conducting a gift or barter transaction. The endowed party does not pay tax. When donating, the apartment is given free of charge, and during the exchange no one receives cash proceeds, since the exchange is recognized as equivalent.
• When selling an owned apartment for more than the minimum period required by law.

Tax non-payment conditions

Russian law provides for conditions that do not have to pay tax when selling real estate. They relate to the period of ownership of the property until the time of sale and other methods of transfer:

• Earnings of a seller of real estate are not subject to tax when the dwelling was in possession of at least the minimum period of time established by law. In other words, starting in 2016, when selling an apartment for more than five years, the fee is not paid to the treasury. In other words, when a citizen has an apartment, house or rooms and has been their legal owner for more than five years and at the same time has become its official owner after the establishment of new rules for calculating the fiscal tax on the sale of real estate, he does not pay income tax on its sale.
• If the property was purchased by paying shares. What tax will I pay on the sale of an apartment? A very common question of citizens owning shares. In this case, you can avoid paying the fiscal fee after the expiration of the minimum tenure since the establishment of the right of ownership. It should pass five years after all registration documents are in the hands of the owner of the residential property.

A citizen can exercise the right to sell without paying a tax due to the minimum deadline for owning real estate under certain conditions. One of them must be observed:

• The property appeared after privatization.
• The apartment (house) is inherited or received as a gift from a close relative (parents, children, full-blooded brothers and sisters).
• The property was handed over by agreement with the dependent regarding its lifelong maintenance.
• The minimum length of the ownership period that exempts the seller from taxes is five years.

So, the tax on the sale of an apartment is provided for by fiscal legislation. Its payment can be avoided as follows:

• Wait tenure for five years.
• Sell ​​property at acquisition price.
• To sell an apartment at a cost of not more than one million rubles. Provided that the sale amount will be at least seventy percent of the value of the inventory. Otherwise, revenues are equalized with the cadastral value, but with a correction factor. This indicator makes it impossible to avoid paying fiscal fees by significantly lowering the value of the property in the document between the seller and the buyer. One million rubles is deducted today from the total amount under the sales contract. If a person suddenly sells real estate for a million rubles, then he will not have to pay a fiscal fee to the tax office.

Real estate

Obtaining (accepting) an inheritance is a rather complicated process from a legal point of view, lasting at least six months. Many citizens of our country are interested in the question, what tax on the sale of an apartment by inheritance must be paid to the state treasury? The answer will not please those who hope to sell inherited property (apartment, house or land) quickly, profitably and without unnecessary financial expenses. When selling a residential property inherited or donated with income tax, it is also subject to tax. Exemption from tax on revenue from the sale of real estate will come only after five years of owning an apartment or other property. There are a number of legislative restrictions:

• determining the price of the inherited residential property is calculated based on its value according to the cadastre;
• There is a limit to the standard fiscal deduction of one million rubles.

These conditions of sale create problems for people who want to sell their inherited property quickly and easily, saving on fiscal fees. If the buyer buys another apartment instead of the existing one, then it is necessary to carefully calculate the profitability of the transaction when the minimum permitted period of ownership has not yet expired, because you will have to pay thirteen percent of the total amount, and not the difference between the purchase and sale price. Deciding to sell real estate and move on to the purchase of other property, you can get significant financial damage.

It is worth remembering that the countdown of the minimum period of possession of inherited property begins from the moment of opening the inheritance, that is, from the day of the death of the former owner of the property, and not from the moment of acceptance of the inheritance (registration of real estate in state bodies).

In this case, upon release, a term of three years is taken. According to the law with innovations, which entered into force in 2016, thirteen percent of the sale is charged. Pensioners and people with disabilities do not pay this fiscal fee. They belong to the preferential category of taxpayers.

Transactions between relatives

When conducting transactions between relatives who are close, the buyer (gifted) loses the right to receive a fiscal deduction. Real estate received as a gift from close relatives is legally exempted from the fiscal fee.

Sales tax deductions

The tax on the purchase of an apartment and the tax deduction are described in the Tax Code of the Russian Federation. Citizens of a country who are required to pay income tax are entitled to claim a deduction for the sale of a residential property. Obtaining property benefits helps to significantly reduce the basis for calculating the fiscal fee, and sometimes save a citizen from paying tax. Consider:

• how much taxpayers can eat up when selling real estate;
• what special conditions are provided by law to confirm a citizen’s right to property deduction.

Any citizen who sells a property that does not belong to the preferential category of citizens exempted from taxes can use the deduction. The conditions for exemption from the fee, from the need to declare the right to a fiscal benefit, substantially changed two years ago:

• For facilities acquired prior to innovation, the conditions are different. When selling an apartment, property less than 3 years old does not have to pay tax (there is no need even to file a tax return with the IFTS).
• Three years of own use of an immovable property acquired before legislative innovations give the right not to pay the fiscal fee on income from the sale if the housing was received free of charge, under an annuity contract or in the process of privatization.
• Five years from the date of registration of the right to an object acquired after changes in the law, exempts from payment of tax on sales income.

If the immovable property has been owned for less than three or five years, the law requires the calculation and payment of sales tax at the rate of thirteen percent. In such financial situations, applying for a fiscal deduction is required, because it allows citizens to obtain financial benefits by reducing the size of the fee to zero. The citizen's earned income from the sale of real estate is subject to general rules at a rate of thirteen percent. Under the income you need to understand the difference between the purchase and sale price of the property, or the price of the object acquired through cashless transactions (inheritance, gift, barter).

If the sale price is not more than the acquisition cost, the fee is zero. However, tax inspectors can verify the validity of the value indicated in the sales document to identify illegal cases of intentional understatement. To calculate the veracity of the price, an indicator of the value of the property is used according to the cadastre. If the profit from the sale does not exceed seventy percent of the indicated indicator, inspectors will demand to use not the contract price, but the market price.

You can receive a deduction for the sale of an apartment in the year following the date of the sale. To do this, you must submit a declaration and independently calculate the fiscal fee, taking into account the size of the deduction.

If the property owner sells the property before the deadlines described above, he will need to pay the fee specified in his declaration. To verify compliance with the specified deadlines, the date of registration of sales transactions is used. The necessary information is contained in the documents on the registration of real estate and the register of real estate rights. If the owner of the property to be sold needs to inform the tax inspectorate of income and pay tax, it is necessary to take into account the peculiarities of providing fiscal benefits:

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• It is necessary to prepare documents on the costs incurred for the purchase or construction of a residential property to reduce the fee (purchase and sale document, receipt or order for transfer of funds, extract from the register, certificate of ownership).
• All listed documents must be submitted to the inspection by April 30th.
• No later than the twenty-fifth of July to pay the amount of tax calculated taking into account the deduction.

The amount of money received from the buyer should be equal to the price of the apartment (house) in the contract.

The decisive factor for obtaining a deduction and for calculating what taxes must be paid when selling a house is the correctness of the presentation of reporting forms and documents. If there are insurmountable difficulties in calculating the deduction or fiscal fee, it makes sense to consult a financial specialist, to seek help from the tax inspectorate. The final reporting package should contain the following reporting forms:

• Tax return.
• Purchase and sale contract, acceptance certificate.
• Confirmation documents on the acceptance of funds under the contract (statements, payment orders).
• Passport of a citizen of the country.

In contrast to the tax deduction for the purchase of a property, the declaration of income from the sale of property is not related to the tax return on personal income from the budget. In this regard, it is not required to attach account details for the return of paid income from the treasury. How to apply:

• personal inspection visit;
• appeal through a representative;
• sending documents by mail with a list of attachments;
• filling out the reporting form on the inspection website through a special software resource.

Tax inspectors have the right to a desk audit if they have doubts about the consistency of the price of the property sold with its cadastral value. They check what income tax on the sale of the apartment should have actually been paid.

The seller may be requested additional documents justifying the calculation of the cost of selling real estate. If the employees of the inspection do not have doubts about the data submitted and the calculated amount of the deduction, then a notification with the required data is sent to the taxpayer. It remains for a person to pay to the budget the amount of tax calculated in the tax return, taking into account the deduction provided.

Responsibility for tax evasion

So, understanding what taxes the seller and the buyer pay in real estate purchase and sale transactions is very important. For non-payment of the fiscal fee, liability is provided for in accordance with civil and criminal laws. Violation is interpreted as not true evidence and tax evasion. The magnitude and severity of the punishment is significant.

The violator is threatened with a fine of up to one hundred thousand rubles or restriction (imprisonment) of freedom for up to three years. It does not matter whether the taxpayer understood or did not understand who should pay the tax when selling real estate. It is safer and safer to file a tax return with the inspectorate and pay the due fiscal amount. If the taxpayer misses the deadline for the fulfillment of obligations, then they begin to charge interest for late payment.

If tax specialists fail to resolve the issue of payment directly with the taxpayer, then they will file a lawsuit and show with what amount the tax on the sale of the apartment is taxed.