How do general rules and local specifics relate?
The rules for calculating and paying land tax are enshrined in Chapter 31 of the Tax Code. The provisions of this chapter are the same for all municipalities of the Russian Federation, but local authorities have the right to establish some features within the framework of general rules.
Thus, the municipality can approve its own tax rates, but these rates should not exceed the maximum values set out in the Tax Code. In addition, for organizations, a municipal entity has the right to set its own deadline for paying taxes and advance payments, provided that the last date for transferring money is not earlier than the one specified in the Tax Code of the Russian Federation. For individuals, the tax payment deadline is fixed directly in the Tax Code. Finally, local authorities can introduce their own land tax benefits, as well as establish or not establish reporting periods within the tax period.
What are the consequences of not meeting payment deadlines?
Compliance with tax payment deadlines is the responsibility of organizations. In case of a violation, when a legal entity is late in payment, the tax authority has the right to collect a penalty from it. They are accrued in accordance with Article 75 of the Tax Code for each calendar day exceeding the established period.
At the end of the year, the tax inspectorate will collect a fine from the negligent organization under Article 122 of the Tax Code, payable to the budget. Its size is:
- 20% of the tax amount for an unintentional error;
- 40% of the tax amount for an intentional error.
Who doesn't pay land tax
Individuals and organizations leasing land plots or owning them under the right of free, fixed-term use.
In addition, the Tax Code contains a closed list of taxpayers exempt from land tax. The list includes religious organizations (in relation to sites under church and charitable buildings); public organizations of disabled people (in relation to sites used for statutory activities); any enterprises in relation to land occupied by public public roads and a number of other categories. This list is valid in all areas without exception.
In addition, each municipality has the right to additionally establish its own benefits.
Let's sum it up
If you have carefully read this text, then the concept of land tax for companies, firms and organizations should not leave you with any questions. We found out that only land owners pay the tax, even if they rent out a plot of land. It calculates the amount of the fee using a simple formula; the rate and financial base are also calculated simply - just know the cadastral number of the plot and its intended purpose.
The declaration must be submitted once a year, but municipalities reserve the right to assign preliminary payments - advances every quarter. The law also controls the timing of payments and the fulfillment of tax obligations on land plots by organizations in principle. If a legal entity neglects its tax obligations, a fine will not be long in coming.
What is not subject to tax?
For plots withdrawn from circulation in accordance with the laws of the Russian Federation. Also exempt from taxation are areas with limited circulation, on which particularly valuable objects of cultural heritage are located, or objects intended to meet the needs of defense, security and customs. Finally, forest lands and areas occupied by state water bodies are not subject to land tax.
It is also stipulated that land plots that are part of the common property of an apartment building are not considered subject to land tax.
Changes in 2021
In 2021, many changes were introduced to land taxation, but the key change is considered to be a change in the calculation procedure.
One of these changes is that previously the calculation was based on the book value of the site, but now the value according to the cadastre is used. The basic tax amount can be found on the Rosreestr website.
The changed calculation rules came into force in 2021, but only in 29 federal subjects. So to speak, a test of the pen, and if it is considered successful, then based on the new rules the most optimal formula for subsequent calculations will be calculated.
Experts admit that the proposed principles for calculating land tax are not ideal. Therefore, additions and changes are expected to be made in the future. But one addition is already known - the rate will increase annually over the next five years. So by 2021 we will have the final amount.
Tax rate
Each municipality approves its own land tax rates, subject to the restrictions established by the Tax Code. It names the maximum values for various categories of land. Thus, for agricultural plots, plots occupied by housing stock and plots intended for personal subsidiary and dacha farming, gardening, vegetable farming and livestock farming, the maximum permissible rate is 0.3%. For all other lands the maximum rate is 1.5%.
In addition, local authorities have the right to differentiate rates depending on the categories of land and the permitted use of the site. You can find out what rates and benefits have been introduced in your area by contacting your tax office.
Who calculates land tax independently?
Until 2021, taxpaying organizations calculated the amount of land tax independently. Tax for 2021 and later periods is calculated by both organizations and inspectors. The Federal Tax Service sends a message to the company indicating the rate, amount to be paid and other information. In case of disagreement, the company has the right to draw up explanations and attach documents to them (for example, about a benefit), and tax authorities are obliged to consider them.
Individual entrepreneurs and individuals without individual entrepreneur status pay land tax on the basis of tax notices sent by the inspectorate. In this case, employees of the Federal Tax Service have the right to present tax for payment for no more than three years preceding the year when the notification was sent. If they include land tax for earlier periods in the notification, the taxpayer has the right not to transfer the money.
So that the tax inspectorate can calculate the tax, information about the plots is sent to the tax authorities by employees of the body that carries out cadastral registration, maintenance of the real estate cadastre and state registration of rights to real estate and transactions with it (State Register). The Tax Code obliges this structure to report to the tax inspectorates annually, before February 1, information about the plots as of January 1 of the same year.
In practice, it happens that the tax office does not receive information on the acquisition by individuals of objects subject to land tax (for example, land plots) in a timely manner. In this regard, tax notices are not sent and tax is not paid because of this. To resolve this problem, an obligation has been introduced for individuals to report to the inspectorate about objects subject to land tax, if for the entire period of real estate the individual did not receive notifications and did not pay the tax. In addition to the message, title documents must also be submitted. This must be done before December 31 of the year following the expired tax period. Individuals who fail to fulfill this obligation may be fined in the amount of 20% of the unpaid tax amount in relation to a plot of land “hidden” from inspectors.
Consequences of delay
Tax legislation provides for extremely strict deadlines for each payment. In particular, land tax can be paid in installments or in one installment, but the deadline for its final transfer must be preserved. Late payment of tax obligations is considered a serious offense and entails penalties. There are two types of fines that apply depending on the violation:
- Penalty for late submission of reports with calculation of the amount of land tax. It is charged at the rate of 5% of the contribution amount for each month of delay, but not less than 1,000 rubles.
- The fine for taxes not transferred to the budget is equal to 20% of the total non-payment for each month of non-payment, if we are talking about an unintentional incident. But if an intention to evade taxes is detected, the rate is doubled.
If sanctions are applied to a specific official who did not submit a report on time or fail to make a payment, then a fine of 300-500 rubles is issued.
Fines may or may not be applied depending on the situation, but penalties are mandatory from the first day of delay. The amount of the penalty is prescribed in the Tax Code and is always equal to 1/300 of the refinancing rate for each day of non-payment.
Legal entities are required to independently determine the budget classification code for paying land tax.
Federal Tax Service specialists are obliged to assist organizations in correctly identifying their group. Incorrectly specified information in the KBK section will result in the money being transferred to another account and not being considered paid. The tax office will regard this fact as a violation and will begin to charge penalties and fines on the unpaid amount.
Errors in a payment order that contribute to the incorrect crediting of money may affect not only KBC directly. Often when filling out the following is entered incorrectly:
- name of the bank that is the recipient of the payment,
- Federal Treasury accounts.
The wrong amount of tax can be returned to the payer after a written request with an explanation of the erroneous deductions. This procedure may take up to a month, but in the meantime, land tax will need to be transferred earlier in order to avoid serious penalties.
How to calculate land tax
You need to determine the tax base and multiply it by the tax rate. The tax base and amount are calculated separately for each plot of land. If the site is located on the territory of several municipalities, then it is necessary to separately determine the base for each part falling on each of the municipalities. If the plot is jointly owned by several persons, then it is necessary to separately determine the basis for each share owned by each person.
The tax base is the cadastral value of the plot (or its share) as of January 1. If the plot is formed in the middle of the year, then the tax base is the cadastral value as of the date of cadastral registration.
The Tax Code of the Russian Federation provides a list of categories of taxpayers for whom the base is reduced by a non-taxable amount. It is equal to the cadastral value of 600 sq. m. area of the site. The number of persons who are entitled to take advantage of this benefit includes, among others, veterans of the Great Patriotic War, heroes of the Soviet Union and the Russian Federation, disabled people and pensioners. Municipal authorities may adjust the list or change the amount of the deduction.
The base should be determined and the tax calculated based on the results of the tax period, which is equal to one calendar year. In the case where the right of ownership (perpetual use or lifelong inheritable gift) arose or ceased in the middle of the year, then the land tax must be calculated taking into account the coefficient. To find it, you need to take the number of full months during which the taxpayer owned the plot and divide it by the number of calendar months in the year.
If the right arose or terminated before the 15th day inclusive, then the month in which the rights arose is taken as a full month. If the right arose or terminated after the 15th day, then the month of termination of the rights is taken as a full month. The same algorithm should be applied in a situation where in the middle of the year the type of permitted use of the site changed, or the site was transferred from one category of land to another.
Let's explain with an example. Let's say an organization purchased a plot of land on February 25 and sold it on September 20. It turns out that the company owned the site for seven full months (March, April, May, June, July, August, September). This means the coefficient is 0.59 (7 months: 12 months).
When to transfer money
Taxpayers-organizations and entrepreneurs transfer land tax no later than the date established by local legislation. According to the provisions of Chapter 31 of the Tax Code of the Russian Federation, such a date cannot be earlier than February 1 of the year following the tax period.
Automatically generate a tax payment invoice based on the data from the declaration and submit reports via the Internet
Municipalities may introduce reporting periods for land tax. These are the first, second and third quarters, respectively. In areas where reporting periods have been introduced, enterprises and individual entrepreneurs must make advance payments throughout the year. The amount of such payment is one fourth of the cadastral value as of January 1, multiplied by the rate. Advance payments must be made within the deadlines established by the municipality. When paying the final tax amount, advance payments made during the year must be taken into account. Municipalities that have introduced reporting periods have the right to exempt certain categories of taxpayers-organizations and entrepreneurs from advance payments.
Taxpayers - individuals do not make advance payments for land tax. They only remit the total tax amount stated in the notice. The deadline for payment of land tax by individuals is specified directly in the Tax Code of the Russian Federation - no later than December 1 of the year following the expiration (regardless of the subject of the Russian Federation).
In addition, individuals can voluntarily make the so-called single individual tax payment. To do this, you simply need to transfer a certain amount to the appropriate Federal Treasury account. The money will be written off to fulfill the obligation to pay “property” taxes, including land tax. The inspection itself will decide how to offset the funds: against upcoming payments or towards payment of arrears.
Budget classification codes
The formation of federal and regional budgets occurs according to a strictly established system. Budgets are replenished from tax deductions and distributed for those needs that were provided for this year. This entire system is very multi-channel - replenishment comes from hundreds, or even thousands of sources, the distribution of budget funds is also a complex and multi-stage procedure.
The territory of the Russian Federation has its own special system, which is divided into four main classes:
- Budget revenues.
- Budget expenses.
- Sources of financing budget deficits.
- Operations of public legal entities or the public administration sector.
Each class has subclasses, which are designated by numbers.
Concept
Budget classification is a breakdown into similar groups of budget revenues and its expenses, as well as sources of financing their deficits. It provides for the calculation of unified indicators of expenses and income and assignment of special grouping codes to them.
KBK is used exclusively by legal entities as a means of identifying the payment being made. Individuals do not have any special gradations based on the location of their plots and contribute funds to a general budget account.
Purpose
The main purpose of budget classification codes is the ability to identify the payment made. The taxpayer can quite easily prove that he has fulfilled his obligations to the budget, and supervisory authorities, in turn, can verify that the payment was made in full and on time.
The CBC divides land plots according to territorial criteria, thereby allowing the boundaries of the plots to be determined. This order is not accidental, because land tax forms local budgets, and they are divided into urban, regional, and rural. Crediting tax to a specific BCC allows you to determine how much goes to a particular budget.
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