How is personal property tax calculated?

Who pays property tax

Russian organizations are required to pay tax if four conditions are simultaneously met:

• there is real estate on the balance sheet (including those transferred for temporary possession, use, disposal, trust management, contributed to joint activities, received under a concession agreement);
• this property is accounted for on the balance sheet as a fixed asset in accounts 01 “Fixed Assets” or 03 “Income Investments in Material Assets”;
• existing property is recognized as an object of taxation on the grounds specified in Art. 374 Tax Code of the Russian Federation;
• the tax base for such real estate is determined as the average annual value.

Also, property tax is paid on real estate located in the Russian Federation and, as a general rule, owned by an organization, obtained under a concession agreement, if the tax base for it is the cadastral value.

Please note that from 2021 the movable property tax has been abolished!

Enterprises will not have to pay tax on land plots, water and cultural objects, as well as on other types of property named in paragraph 4 of Art. 374 Tax Code of the Russian Federation.

A number of organizations, depending on the type of activity, are not charged tax (Article 381 of the Tax Code of the Russian Federation).

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Where to transfer money

Taxes and advance payments in respect of property owned by the parent organization must be transferred to the budget at the location of this organization.

Taxes and advance payments in respect of property owned by a separate division that has a separate balance sheet must be transferred to the budget at the location of this division. When calculating the amount of tax and advance payments, the rate established for the region where the unit is located should be applied.

Tax and advance payments in respect of real estate located outside the location of the parent organization and divisions that have their own balance sheet must be transferred to the budget at the location of such real estate. Tax amounts and advance payments should be calculated at the rate established for the region where the property is located.

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Tax calculation based on average annual cost

In turn, the average annual value = (total residual value of the property as of the 1st day of each month + residual value as of December 31) / 13.

Calculation example. Kompas LLC has been on the services market for 8 years. During this time, the Company purchased various fixed assets that help carry out its activities. Some of the property is still depreciated and considered taxable. In addition, the company purchased new equipment on July 4, 2020. The region applies a rate of 2.2%. The accountant, filling out the declaration for the past year, used the following data:

Let's calculate the average annual cost: (100 + 95 + 90 + 85 + 80 + 75 +70 + 234 + 207 +191 + 174 + 146 + 118) / 13 x 1000 = 128,077 rubles.

Tax payable for the year = 128,077 x 2.2% = 2,818 rubles. (provided that the organization does not pay advances).

If advance payments are established in the region, organizations need to pay them three times a year, and then reduce the tax payable for the year by their amounts.

Let us assume that in the proposed example, in addition to tax, it is required to calculate the amount of the advance for all reporting periods.

Average cost of taxable objects for the first quarter = (100 + 95 + 90 + 85) / 4 x 1000 = 92,500 rubles.

According to Art. 382 of the Tax Code of the Russian Federation, the advance payment is equal to ¼ of the average cost for the reporting period, multiplied by the rate.

Advance payment for the first quarter = 92,500 x ¼ x 2.2% = 509 rubles.

The half-year payment is calculated in the same way.

Average cost for half a year = (100 + 95 + 90 + 85 + 80 + 75 + 70) / 7 x 1,000 = 85,000 rubles.

Advance for half a year = 85,000 x ¼ x 2.2% = 468 rubles.

Average cost for 9 months = (100 + 95 + 90 + 85 + 80 + 75 + 70 + 234 + 207 +191) / 10 x 1,000 = 122,700 rubles.

Advance for 9 months = 122,700 x ¼ x 2.2% = 675 rubles.

The annual tax is paid minus any advance payments.

Tax for 2021 payable to the budget = 2,818 – (509 + 468 + 675) = 1,166 rubles.

Tax calculation based on cadastral value

The tax base for a certain part of real estate corresponds to the cadastral value indicated in the Unified State Register as of January 1 (Article 375 of the Tax Code of the Russian Federation). This includes real estate from clause 1 of Art. 378.2 Tax Code of the Russian Federation.

If a company pays tax based on cadastral value, then you must first find it out in the regional office of Rosreestr or in an extract from the Unified State Register of Real Estate. You can also view the cost online on the Rosreestr website or in the regulatory act of your region, which approved the results of determining the cadastral value. If your property is included in the regional list, but the cadastral value for it has not been established, you do not need to pay tax. However, residential premises, garages, unfinished construction and other objects from paragraphs. 4 paragraphs 1 art. 378.2 of the Tax Code of the Russian Federation, is not indicated in regional lists. The tax on them is paid on the basis of regional law, which should provide for cadastral taxation of these objects. If the cadastral value for them has not been determined, calculate the tax at the average annual value.

Formula for calculating tax based on cadastral value:

Tax amount for the year = Cadastral value × 2.2% - advance payments.

Advance payment = Cadastral value of the property as of January 1 × 2.2% × ¼.

Calculation example . PlusMinus LLC owns an office in the business center. The cadastral value of the premises has not been determined, but it is known that it occupies 1/16 of the building’s area. According to Rosreestr, the cadastral value of the business center is 184 million rubles.

Cadastral value of the office = 184 million rubles / 16 = 11.5 million rubles.

Tax amount for the year = 11.5 million rubles × 2.2% = 253,000 rubles.

Advance payments will be = 253,000 / 4 = 63,250 rubles per quarter.

Procedure and deadlines for tax payment

The tax period is a calendar year (Article 379 of the Tax Code of the Russian Federation).

The reporting period is 1 year. Previously, advance payments had to be submitted every quarter. Now they have been included in the declaration, so there is no need to report separately. The last report on advances was submitted for 9 months of 2021.

At the end of the year, property taxes are paid, and at the end of quarters, advance payments are paid. Regional authorities may decide not to establish advance payments, in which case the tax will only have to be paid once a year.

The deadlines for payment are also set by the constituent entities of the Russian Federation (Article 383 of the Tax Code of the Russian Federation).

Where to submit reports

Organizations are generally required to report property taxes at the location of each facility. A company that owns several real estate properties has the right to submit a single property tax return. To do this, three conditions must be met.

1. All objects are located on the territory of one subject of the Russian Federation.
2. Property tax is fully credited to the budget of a given subject of the Russian Federation without deductions to local budgets.
3. Property tax for all specified objects is calculated based on the average annual value, not the cadastral value.

If the conditions are met, the organization can choose an inspection agency to submit reports to. You must notify the regional department of the Federal Tax Service of your choice no later than March 1 of the year that is the tax period. The chosen procedure for submitting a single declaration is maintained until the end of the tax period. Next year you need to either abandon the single declaration or send a new notification.

* The guidelines were approved by order of the Ministry of Finance dated October 13, 2003 No. 91n..

Property tax declaration

Please note that by Order of the Federal Tax Service dated August 14, 2019 No. SA-7-21/ [email protected] as amended on July 28, 2020, a new form of property tax declaration for 2021 was approved. The order comes into force on November 3, 2020. Based on the results of 2021 (before April 1, 2021), you already need to report using the new form.

Rules for filling out a declaration with line-by-line comments from the appendix to the Order of the Federal Tax Service of the Russian Federation dated August 14, 2019 No. SA-7-21/ [email protected]

In the first section, line 005 “Taxpayer Attribute” was added, which is related to coronavirus benefits, and line 007 “SZPK Attribute” for organizations that have entered into an agreement on the protection and promotion of capital investments. For section two, new codes for coronavirus federal and regional benefits were approved, as well as a special code for the property of FEZ participants.

The most important innovation is the appearance of the fourth section, in which organizations will again have to reflect information on the average annual value of movable property recorded on the balance sheet as fixed assets (it is still not subject to tax). The amendments are being made to assess the value of movable property, which is currently exempt from tax. It is planned that taxation of movable property will return in the near future, but tax rates will be reduced.

How to claim benefits for land and transport

Starting from 01/01/2020, in order to take advantage of benefits on land and transport taxes, you must submit an application to the inspectorate.
A new form was needed due to the cancellation of filing tax returns for the specified taxes for 2021 with the Federal Tax Service. Therefore, if a company applies for benefits, then in 2021 it is necessary to submit an application to the Federal Tax Service for their provision. The fact is that the availability of benefits before the cancellation of declarations was confirmed in the declaration form itself in the special detail “Tax benefit code”.

To submit an application, a single form is used, which is called “Application of a taxpayer-organization for a tax benefit for transport tax and (or) land tax.”

The form consists of three sections: a title page and one section each for transport and land taxes.

The procedure for filling out the application indicates that if an organization claims only a land tax benefit, the blank sheet with fields for transport tax does not need to be submitted. However, this issue needs to be clarified with your inspection.

When claiming a land tax benefit, you must indicate:

• cadastral number of the plot;
• the duration of the benefit and its code;
• information about the municipal act that establishes the benefit;
• information about documents confirming the benefit.

Benefit codes are also given in the appendix to the procedure for filling out the application.
Please note that some land tax benefits are established not at the municipal level, but at the federal level - in the Tax Code of the Russian Federation. In this case, the fields intended for information about the local legal entity are not filled in. We are talking, for example, about benefits for areas under public roads. For transport tax benefits you must indicate:

• type of vehicle, its make (model) and license plate number;
• the period for granting the benefit;
• information about documents confirming the benefit;
• benefit code and details of regional law.

In the appendix to the procedure for filling out the application, only four codes are indicated: one for benefits under an international treaty and three for regional benefits (exemption from payment, reduced rate and reduced tax amount). Let us remind you that currently benefits for organizations are established only in the laws of the constituent entities of the Russian Federation. For example, in Moscow, SEZ residents do not pay transport tax, in the Sverdlovsk region, public organizations of disabled people pay only 35 percent of the calculated tax amount, and in Bashkiria, agricultural producers apply rates that are halved.

ORDER of the Federal Tax Service of the Russian Federation dated July 25, 2019 No. ММВ-7-21/ [email protected] “On approval of the application form of a taxpayer-organization for the provision of a tax benefit for transport tax and (or) land tax, the procedure for filling it out and the format for submitting the specified application in electronic form"