TaX
•
Apart from 1% fee for notarization of the property pur-
chase agreements, sale of real estate is subject to the Pension
Fund duty at 1% rate from the contract value payable by the
buyer.
•
Profit from sale of immovable property by a foreign company
is subject to 15% withholding tax (WHT). In case provisions of
a relevant double tax treaty are applicable, the rate may be
different (usually, lower).
•
Value added tax at the rate of 20% is applicable to proceeds
from sale or lease of real estate property, other than land, by a
company; (exemptions and exceptions exist, however eligibility
of property businesses to such exemptions and exceptions is
not customary).
•
Subject to certain exceptions and reservations: (a) personal
income tax (PIT) from sale of property is 5% for Ukrainian
nationals and 17% for foreign individuals; (b) PIT regarding rent
receivables is 17%. (Note: the 17% rate applies with regard to
the amount in excess of about EUR 1100 (10 minimal salaries);
the amount below is subject to the 15% rate).
•
Residential properties are subject to the property tax payable
by both companies and individuals. The rate ranges from 1 to
2.7 per cent of the minimal monthly salary (currently, about
EUR 110) per the 1 square meter of the residential area depen-
ding on the property type and area and may be subject to
certain deductions.
•
Land payments are payable by both individuals and legal enti-
ties either as land tax (if owned) or rent (if leased). Tax rates
depend on the estimated value and category of land. If the
value is unspecified the tax amount is assessed with the appli-
cation of the respective index depending on different factors:
category of land, the amount of people living in the populated
locality, etc. Usually, the annual land payments are within range
from 1 to 10 per cent of the land valuation.
Investor Guide to Europe 2014 | 107
