First, it’s worth understanding what real estate tax is. According to the laws of our country, residential and commercial properties are subject to taxes for the right to own and use them. And if before 2022 the situation with who should pay how much and to whom was extremely clear, then under the conditions of martial law in Ukraine the circumstances have changed a little. Towards property owners or not? This is exactly what we have to deal with.
We would like to warn you that failure to pay taxes will not go unnoticed. In order not to run into problems and avoid fines, you should pay due attention to studying this topic.
Who will have to pay taxes this year and for what?
We suggest starting this not the most pleasant topic with a positive point - not all real estate objects require payment of taxes. You are not afraid of additional expenses if you own:
- apartment up to 60 m²
- house up to 120 m²
- other objects such as garages and outbuildings up to 180 m²
If you decided to live large and please your loved ones with personal space for each of them, you probably failed to fit your possessions into the given framework. You have to pay for comfort - the tax has crept up unnoticed and is waiting for you to take action. The amount you will have to pay to own and use your property is determined at the local level. Clear and reasoned figures await you.
Don't rush to say goodbye to your hard-earned savings. You will have to pay tax not for the entire object, but only for the number of meters by which it exceeds the specified standards.
Necessary or not necessary: will the tax affect you?
We have already found out that all owners of “extra” square meters will not be able to enjoy spacious housing without additional expenses. But there are a number of rules that you should know about:
- can I avoid tax if I am a minor? - alas, my young friend, your parents or guardians will have to pay taxes from their own wallet
- Can retirement age be a reason for a discount? – and again the answer is negative. General rules apply to everyone
- who should pay? – owner of the personal account
- But what if there are several owners? – each of them is obliged to cover their part of the costs
All, but not all – some categories of the population are exempt from paying taxes. Do you see yourself on their list?
- foster and large families with 5 or more children
- disabled people and orphans who have not reached the age of majority, living with only one guardian or parent and owning no more than one piece of real estate
- organizations such as religious communities, children's educational institutions and community organizations serving people with disabilities
- properties owned by local or national authorities that are uninhabitable and not used for commercial purposes
A separate category of those who are exempt from paying taxes in wartime are people whose real estate is located in occupied territories, in a war zone, or was damaged or destroyed.
How much and what to pay for?
Property tax may differ depending on what kind of tax we are talking about:
- ownership tax
- sales tax
- luxury tax
Luxury does not mean those extra meters that you have already learned about, but real architectural masterpieces that amaze with their magnificence:
- apartments starting from 300 m²
- houses starting from 500 m²
In addition to the basic amount, you will have to pay an additional 25 hryvnia every year for using the facility.
If earlier you sincerely loved summer for its bright sun, hot weather and lush greenery, now you will be wary of waiting for its middle because letters from the tax office arrive before July 1st. Don’t blindly believe every number and every extra hryvnia that they want to take away from you. The human factor has not been canceled, so it is worth eliminating possible errors and typos by independently calculating the amount. To do this, remember a few important rules:
- do not rush to accuse your friend of fraud if he is simply lucky enough to live in a more loyal place - taxes are different in different cities because they are set by local authorities
- the tax is charged only for “extra” meters, but not for the entire size of the apartment, house or other object
- the numbers are not taken from the head - the basis for calculations is usually taken to be the size of the official minimum wage fixed in the previous year. Confused? We'll explain: If you pay taxes in 2023, you should take the minimum wage for January 1, 2022
Try to calculate the tax you will have to pay yourself. To do this, we need to know several nuances: the size of your apartment (for example, 74 m²), preferential footage (60 m²), minimum wage (6 UAH) and tax rate. The tax rate is 500% of the minimum wage, which in this case is 1,5 UAH.
Let's move on to calculations using the long-established formula:
(area of your property - preferential footage) × tax rate = tax you have to pay → (74 - 60) × 97,5 = 1 UAH
It's not as scary as it might seem, is it?
How the tax office teaches citizens to be punctual
For late payment or non-payment of tax at all, you will be subject to a fine. The letter you receive from the tax office clearly states the date by which you must deposit the amount into the account. If for some reason you were unable to do this on time, you cannot do without penalties. If less than 30 days have passed since the specified date, the fine will be 10% of the amount of your debt. If you are a risk-taker and decide to ignore the “chain letter” and its requirements for more than a month, the fine will increase to 20%. If you completely systematically ignore your obligations to the state, expect extreme measures - not only large fines, but also blocking of accounts.
Don’t be lazy to calculate the tax amount yourself. In a situation where tax officials made a mistake, you have every right to submit an application to double-check the data.
Premium real estate agency THE Capital considers its goal not just to help clients select property for purchase, renting and conducting commercial activities. We are committed to providing comprehensive service and professional support to ensure you enjoy your investment. Contact us to receive qualified advice from our experienced experts.
