IP sale of non-residential premises. Currently, we do not have examples from arbitration practice on this issue.
The property was purchased individual, having the status of an individual entrepreneur in 2005, for an office and was used by him in his business activities. In the documents confirming the ownership of it, it is indicated that it was acquired by the IP. At present, entrepreneurial activity has been terminated by an individual; previously, a simplified taxation system was used by an individual entrepreneur. It is planned to sell this premises for 5 million rubles. Under what taxation system and at what rate will an individual's income from the sale of premises be taxed?
After considering the issue, we came to the following conclusion:
Since at the time of the transaction an individual has lost the status of an individual entrepreneur and does not apply the simplified taxation system, the proceeds from the sale non-residential premises are subject to inclusion in the tax base for personal income tax and are taxed at a tax rate of 13%, also regardless of whether the property is used at the time of sale to generate income or not.
Rationale for the conclusion:
By acquiring and losing the status of an individual entrepreneur, a citizen becomes the subject of certain tax legal relations, respectively, ceasing his activity, an individual entrepreneur ceases to be a special subject of tax legal relations upon cancellation state registration(Second Arbitration Court of Appeal dated March 12, 2012 N 02AP-8013/11).
For such income, a tax rate of 13% (TC RF) is applied. At the same time, according to, and the Tax Code of the Russian Federation, an individual should independently calculate and pay the amount of personal income tax to the budget system, and also submit a personal income tax return to the territorial tax authority at the place of registration no later than April 30 of the year following the expired tax period (TC RF) ( Ministry of Finance of Russia dated March 23, 2012 N 03-04-05 / 8-365).
Prepared answer:
Legal Consulting Service Expert GARANT
Volkova Olga
Answer passed quality control
The material was prepared on the basis of an individual written consultation provided as part of the Legal Consulting service.
(1) In our opinion, the position of the Russian Ministry of Finance is far from being indisputable. The fact is that the Tax Code of the Russian Federation refers to income "from the sale of property directly used by individual entrepreneurs in entrepreneurial activities." The specified norm can be interpreted in a different way and say that it refers to property used in business activities and sold in the period when an individual has the status of an individual entrepreneur. Based on the clarifications of the Ministry of Finance of Russia, the restriction applies to any property ever used by an individual entrepreneur in entrepreneurial activities.
Given that this point of view does not coincide with the position of the financial department, it is likely that the right to exemption from taxation of the transactions in question and the income received will have to be defended in court.
We currently do not have examples from arbitration practice on this issue.
When the question of payment of taxes concerns organizations conducting commercial activities, it seems absolutely natural.
Another thing is when income is associated with the sale of property by individuals. It is not always clear to everyone whether it is necessary to pay tax. For example, when selling non-residential premises.
This question depends on the following factor. It is necessary to specify how long the property has been occupied. It is one thing if this period exceeds a three-year period, and quite another if it is less.
This publication is divided into two parts. Each of them will tell about their case. The format of the article is not large enough to accommodate the answers to all possible questions on the topic of sale of non-residential premises by an individual, subsequent taxation.
Therefore, after reading it, it will be possible to get a full consultation from specialists specifically for your case.
Owners who have owned for more than three years
The legislation provides an opportunity not to pay tax to individuals who fall under this category. However, it may be necessary to confirm that no commercial activity has taken place.
This refers to activities directly related to this room. Recall that this article deals specifically with non-residential premises and individuals (not organizations).
The fact is that the tax authorities can check whether commercial activity was carried out at the address of the sold area in the last thirty-six months. If there was none, no income taxes are paid.
If this area was provided for rent, the tax authorities will have questions. In this case, the decisive factor will be whether personal income tax was paid for the period of renting the premises. If everything is paid, there is no problem (tax is not paid).
One of the factors arousing the suspicion of the tax authorities is the availability of primary accounting documents. This means if the place of shipment (receipt) of goods for commercial purposes is the address of the sold premises.
The three-year period begins its report from the moment the area is registered as non-residential. If the building was originally built or purchased as such, the start date is the date of registration of ownership. If there is a transfer of premises from the category of residential to non-residential - the date of registration as non-residential.
Ownership less than thirty six months old
In this case, you will have to pay a thirteen percent personal income tax. True, it can be somewhat reduced. There are two possibilities for this. The first involves the sale of "other property".
Moreover, its cost should not exceed a quarter of a million rubles. In this case, thirteen percent will be calculated from the difference between the amount received from the sale of the premises and this amount. If these values are equal, then the deduction will occur on the entire amount and no tax will be paid.
The calculation of the amount to be deducted may include all the expenses that were incurred to complete the transaction. One requirement - they must have documentary evidence. This is the second way.
To calculate taxes on the sale of non-residential real estate, it is necessary to take into account 2 main criteria: the first and most important is the legal status of a citizen (physical or entity), the second is the period of ownership of the real estate being sold. There is another criterion that can significantly increase tax costs: a non-resident selling non-residential property will have to pay a tax of 30% of the transaction amount. Such situations are relatively rare, so the first two criteria should be the focus of the tax calculation.
Taxes on the sale of non-residential real estate by an individual
Owning non-residential premises over three years and without linking its use with any business activity, according to Russian legislation the seller can avoid paying personal income tax. This, as well as the absence of the need to indicate the amount of the transaction in the declaration, is spelled out in the Tax Code of the Russian Federation, Art. 217 p.17.1. In this case, real estate can be classified as “other property”, the sale of which will not interest the employees of the Federal Tax Service. A completely different situation develops in the presence of signs of entrepreneurial activity. Moreover, the same 3 recent years ownership of non-residential property. In other words, only the absence of evidence of conducting business activities at this facility will remove the issue of paying tax on the income of an individual. The sale by an individual of non-residential real estate that was owned by the seller for less than three years requires payment of a 13 percent personal income tax. At the same time, the Tax Code provides an opportunity to reduce costs. Here the seller has two options:- Tax deduction. Today, the state is ready to reduce the tax base by 250 thousand rubles, that is, when selling office space for 1 million rubles the tax on the income of an individual will be (1,000,000-250,000) * 0.13 \u003d 97,500 rubles.
- Document the expenses that had to be incurred in order to receive taxable income. In our case, providing papers confirming the purchase of office space for 500 thousand rubles, personal income tax will be: (1,000,000-500,000) * 0.13 = 65,000 rubles.
Tax on the sale of non-residential property by an individual entrepreneur
A legal entity selling non-residential real estate that was used in economic activities is obliged to provide documents reflecting the accounting of income received from this activity. In this case individual entrepreneur 6% tax must be paid under the simplified taxation system. The exception will be the sale of non-residential property at a price of more than 60 million rubles - here the tax authorities have the right to apply all existing rates for DOS. The main problem faced by potential sellers of non-residential properties is the choice of the most “cheapest” sale option. Very often, disputes with tax authorities go to the level of economic courts, which make a decision based on the study of the submitted documents. That is why there are cases of early closure of the IP before the sale of real estate or, conversely, the provision of more evidence of doing business in non-residential premises being sold. You will be interested in: Delivery of 6 personal income tax: examples of filling out a report, form, deadlines, calculation according to form 6 personal income tax