Recently, a simplified scheme for obtaining certain tax deductions began to work in Russia, which we described in more detail in one of the previous articles. A deduction for the construction of a country house is a special case, which also makes it possible to take advantage of the new simplified procedure for returning part of the funds spent. In this material, read about the important features and useful nuances of obtaining such a deduction.
Public figure and economist Roman Kharlanov answers:
Transactions up to one million rubles are not subject to a 13% tax. If the property is owned for more than three or five years (depending on the year of acquisition), income tax is also not paid. In this situation, if the cost of the apartment is 3.1 million rubles and you want to sell it soon after purchase, then you can try to go the other way. For example, if you (conditionally) bought a home for a little over two million, and sold it for three, that is, the difference in price is slightly less than one million, in principle, you can indicate in the documents not revenue, but income. In other words, your personal profit from the transaction. Then, perhaps, it will be possible to avoid paying this 13%. However, in this case, the tax inspectorate needs to provide the appropriate grounds.
What subtleties do you need to know about the tax on the sale of an apartment?
I sold my home and bought a new one, with zero income. What about taxes?
Property deduction for new construction, purchase of housing, land
Based on paragraphs. 2 p. 1 art. 220 of the Tax Code of the Russian Federation, a taxpayer has the right to receive a property deduction for new construction or acquisition on the territory of the Russian Federation of a residential building, apartment, room or share(s) in them, land plots provided for individual housing construction, and land plots on which the purchased residential buildings are located, or share(s) in them.
SIZE OF DEDUCTION
The deduction can be obtained once and in relation to one purchased item for the following types of expenses incurred:
1) on expenses for new construction or acquisition of housing and land plots on the territory of the Russian Federation ( in the amount of no more than 2,000,000 rubles );
2) on expenses for repaying interest on targeted loans (credits). These loans (credits) must be received from Russian organizations or individual entrepreneurs and actually spent on new construction or acquisition of housing or land ( in the amount of actual expenses );
3) on expenses for repaying interest on loans received for refinancing (on-lending) loans (credits) for the construction or purchase of housing, as well as land. Such loans must be provided by banks located in the Russian Federation ( in the amount of actual expenses ).
ATTENTION: the deduction does not include expenses other than interest associated with obtaining and servicing a loan or loan (for example, for issuing a loan, account servicing, currency conversion, insurance of collateral, life and health of the borrower).
When purchasing property into common joint ownership, the deduction is distributed among the owners upon their written application in the agreed amounts (in any proportions, including 0% and 100%). An application for distribution of the deduction is submitted to the tax authority once upon the initial application for the deduction of one of the co-owners. The tax authority’s decision to grant a deduction is also made once and is not subsequently adjusted.
When purchasing property in common shared ownership, the amount of the deduction is distributed among the co-owners in accordance with their share(s) of property. A participant in shared ownership cannot transfer a deduction in respect of his share in the property to another participant.
On a note
The deduction in respect of a land plot for individual housing construction and the land plot on which the housing is located, or a share(s) in them, is provided only after a certificate of ownership of the house is received for the housing.
WHAT EXPENSES ARE CONSIDERED IN THE DEDUCTION AMOUNT
The list of such expenses is established by clause 2, clause 1, article 220 of the Tax Code of the Russian Federation.
The actual costs of new construction or the acquisition of a residential building or share(s) in it may include:
costs for the development of design and estimate documentation;
expenses for the purchase of construction and finishing materials;
expenses for the purchase of a residential building, including unfinished construction;
expenses associated with construction work or services (completion of a house that has not been completed) and finishing;
costs of connecting to electricity, water, gas supply and sewerage networks or creating autonomous sources of electricity, water, gas supply and sewerage.
The actual costs of purchasing an apartment, room or share(s) in them may include:
expenses for purchasing an apartment, room, share(s) in them or rights to an apartment, room in a house under construction;
expenses for the purchase of finishing materials;
expenses for work related to the finishing of an apartment, room, share(s) in them, as well as expenses for the development of design and estimate documentation for finishing work.
Acceptance for deduction of expenses for the completion and finishing of an acquired house or finishing of an acquired apartment, room is possible if the agreement on the basis of which such an acquisition was made specifies the acquisition of an unfinished residential building, apartment, room (rights to an apartment, room) without finishes or share(s) therein.
WHEN IS THE DEDUCTION PROVIDED?
The property tax deduction can be applied from the tax period in which the right to the deduction arose.
The right to a deduction arises in the tax period when the following conditions for obtaining a deduction are met:
— there are documents confirming the expenses incurred for the purchase of housing (land);
- there are documents confirming the ownership of housing (when acquiring rights to an apartment (room) in a house under construction - an act of transfer of such housing).
The deduction is provided in respect of income of the tax period in which the right to it was obtained and subsequent periods.
If in the tax period in which the taxpayer purchased real estate, he had no income taxed at a rate of 13%, then:
— the deduction can be used for any tax period from the moment the right to deduction arose, when the taxpayer had income taxed at a rate of 13%;
- a deduction can be provided in respect of income received no earlier than three tax periods preceding the one in which the taxpayer applied for a deduction (grounds - clause 7 of Article 78 of the Tax Code of the Russian Federation);
— the deduction can be provided for any tax period, starting from the one in which the taxpayer became entitled to it.
Note! If a property deduction cannot be used in full during a tax period, its balance can be carried forward to subsequent tax periods until it is fully used. For taxpayers receiving pensions in accordance with the legislation of the Russian Federation, if they do not have income taxed at a rate of 13%, the balance of the property deduction can be transferred to previous tax periods, but not more than three.
The taxpayer has the right to suspend the use of property deductions by submitting a corresponding application to the tax office (grounds - clause 2 of Article 56 of the Tax Code of the Russian Federation). You can suspend the use of a deduction only for the current or subsequent tax periods. In this case, the taxpayer’s right to deduction does not cease.
The taxpayer has the right to stop using the property tax deduction by refusing it (Clause 2 of Article 56 of the Tax Code of the Russian Federation). To waive the deduction, you must submit a corresponding application to the tax authority. However, you cannot refuse the deduction used in the previous period.
WHO IS NOT RIGHT TO USE THE DEDUCTION
The taxpayer has no right to take advantage of the deduction when:
a) payment for the construction (purchase) of housing was made at the expense of employers or other persons, funds from maternal (family) capital, as well as through payments provided from the federal budget, budgets of constituent entities of the Russian Federation and local budgets;
b) the purchase and sale transaction was concluded with an individual who is interdependent in relation to the taxpayer in accordance with Article 105.1 of the Tax Code of the Russian Federation.
HOW TO GET A DEDUCTION FROM THE TAX INSPECTION
from the tax office at your place of residence at the end of the calendar year.
To receive a property deduction, you must submit the following documents:
1) declaration in form 3-NDFL;
2) application for deduction (drawn up in any form). The application can be filled out at the inspection office when submitting the declaration. As a rule, each inspection has a ready-made application form in which you will need to enter your data;
3) documents confirming the taxpayer’s right to housing (land):
a) during the construction or acquisition of a residential building (including unfinished construction) or a share(s) in it - documents confirming ownership of the residential building or share(s) in it;
b) when purchasing an apartment, room, share(s) in them or rights to an apartment, room in a house under construction - an agreement on the acquisition of an apartment, room, share(s) in them or rights to an apartment, room in a house under construction, an act of transfer apartments, rooms, share(s) in them to the taxpayer or documents confirming ownership of the apartment, room or share(s) in them;
c) when purchasing land plots provided for individual housing construction, and land plots on which the acquired residential buildings are located, or share(s) in them - documents confirming ownership of the land plot or share(s) in it, and documents , confirming ownership of a residential building or share(s) in it;
4) payment documents drawn up in the prescribed manner and confirming the fact of payment of funds by the taxpayer for expenses incurred: receipts for receipt orders, bank statements on the transfer of funds from the buyer’s account to the seller’s account, sales and cash receipts, acts on the purchase of materials from individuals indicating the address and passport details of the seller and other documents;
5) certificate(s) in form 2-NDFL, received from the employer (other tax agents who paid the taxpayer income taxed at a rate of 13% in the expired tax period);
6) documents confirming interest payments:
— a copy of the credit (mortgage) agreement or targeted loan agreement;
— a copy of the loan repayment schedule and interest payment under the loan (mortgage) agreement (target loan agreement);
— a certificate from the organization that issued the credit (loan) about the interest paid in the reporting tax period for using the credit (loan);
— payment documents confirming payment of interest.
When submitting a declaration, you must make copies of documents for housing (land) and payment documents. The tax inspector will compare them with the originals and return the originals to the applicant.
HOW TO GET A DEDUCTION FROM YOUR EMPLOYER
The employer provides the employee with a property deduction based on the notification. For notification, the taxpayer must contact the tax office at the place of residence . The notification form was approved by order of the Federal Tax Service of Russia dated December 25, 2009 N MM-7-3/ [email protected] The notification is issued by the tax authority within a period not exceeding 30 calendar days from the date the taxpayer submits a written application and documents confirming the right to the deduction. The taxpayer submits similar documents when re-applying to the tax authority for notification in order to receive from the employer the balance of the unused property deduction.
Yulia Dymova, legal consultant of the secondary real estate department of Est-a-Tet, answers:
When it comes to costs, there are different types of tax deductions. You can indicate in your tax return the amount for which you purchased this apartment. In this case, you will not pay tax on this amount, but there is a tax deduction of 1 million rubles, which requires a separate application for the tax return. When selling an apartment, you can only count on the tax deduction associated with the purchase of the apartment. However, you can separately declare a tax deduction for purchases of 2 million rubles; it is 13%. It is also possible to claim a tax deduction for repairs of 13% on all investments in repairs.
What exactly can be included in expenses?
If we talk about expenses for the purchase of a house, a plot of land for individual housing construction, or expenses for new construction, then the expenses can additionally include expenses for:
- development of design and estimate documentation;
- purchase of construction and finishing materials;
- construction work or services (completion of a residential building or a share(s) in it that has not been completed) and finishing;
- connection to electricity, water and gas supply and sewerage networks or creation of autonomous sources of electricity, water and gas supply and sewerage.
The amount of deduction that can be received for expenses for the purchase/construction of a residential building (plot of land) is limited - this is 2 million rubles, if there were expenses for paying interest on the loan for the corresponding purposes - then 3 million rubles. In total, two maximum amounts are possible for return: 260 thousand rubles and 390 thousand rubles.
Professional private accountant, independent expert Alena Klikina answers:
If you owned the apartment for less than three or five years (depending on the year of purchase) or you sold the apartment for more than you bought it for, then by law you are required to pay personal income tax. You can reduce the tax base for personal income tax by taking advantage of the right to a standard tax benefit in the amount of 1 million rubles, provided that you did not use this benefit in the reporting year earlier.
Tax on the sale of an apartment: rules and examples
Does selling an apartment prevent you from getting a tax deduction?
Secondly, if the property was not gifted to you, then you can show the tax costs associated with the purchase of the apartment. To do this, you need to submit a copy of the purchase agreement for this apartment and a document confirming payment along with the 3-NDFL declaration. Please note that one of the essential conditions for reducing the taxable base for personal income tax is the acquisition of new property in the same reporting period and the use of the right to property deduction. For example, 3.1 million rubles (cost of the sold apartment) – 1 million rubles (tax benefit) = 2.1 million rubles (tax base for personal income tax). When purchasing property for 2 million rubles or more, you have the right to a property deduction in the amount of 2 million rubles. In this regard, 2.1 million rubles – 2 million rubles = 100 thousand rubles. Accordingly, 13% of 10 thousand equals 13 thousand rubles.
13% of 2.1 million rubles is equal to 273 thousand rubles.
273 thousand – 13 thousand rubles = 260 thousand rubles.
In total, the tax will be 260 thousand rubles less. Attention! This law does not apply to the purchase of movable property.
When can you get a deduction?
Initially, the right to receive a tax deduction in the amount of 13% of the value of the property is fixed in the Tax Code - this deduction belongs to the category of property. It is provided for expenses on the construction of a house for living, that is, the purpose of the object must be “residential”. It does not matter what category the land on which this house is located belongs to. You can also get a deduction for purchasing a plot of land on which a residential building is built.
Such a deduction is provided starting from the tax period during which ownership of the residential building was registered (we are talking about a calendar year). To obtain it, you must have documents confirming the costs of building a house: these can be payment documents for the purchase of building materials, payment for work, an agreement with a contractor for the work, etc.
