Few citizens, after buying or selling property, seek the information contained in the tax code. Therefore, you need to familiarize yourself with your rights at least from other sources. For example, this question directly concerns pensioners who bought an apartment. Paragraph 10 of Article 220 of the Tax Code of the Russian Federation will provide them with very important and necessary information. It concerns property deductions. What does this mean? What are the main theses of Article 220 of the Tax Code of the Russian Federation? What is its importance?

Introduction to Basic Concepts

The property tax deduction applies only to those people who pay a tax of 13% to the state and non-working pensioners. This information is found in some paragraphs of Article 220 of the Tax Code of the Russian Federation. Knowing about him, no one would refuse to return a certain amount of money after purchasing or selling an apartment. Income taxes can be refunded even if they were already paid in previous years. When filling out declarations, please note that you cannot indicate expenses related to property taxes here. They cannot be returned. But a personal income tax of 13% is quite possible if you visit the tax office at the specified time, leave documents for consideration of your personal file and assignment of payments in a certain amount. Paragraph 10 of Article 220 of the Tax Code of the Russian Federation concerns pensioners and the main amendment therein. They can also apply for a property tax deduction, and those who no longer work at a state-owned enterprise can also do this.

Features of the settlement system

Clause 10 with its amendments appeared a long time ago, but the clarification that the property deduction will apply to non-working pensioners was made several years ago. Now property tax deductions can be carried forward 3 years earlier, but no later than for 2008. It is important to remember that the corresponding application must be submitted during the tax period, which will be the first of the year after the purchase or sale of the apartment. Only then will the transfer of refund calculations to previous years be considered, otherwise the pensioner will receive funds only for the last period of time. This means that if he bought an apartment at the beginning of 2017, then the application must be submitted in the first tax period of 2018.

By filling out the declaration and providing the documents necessary for the inspection to consider your personal file, you can use the refund for the previous 3 years: 2021, 2015, 2014. The new tax code has made amendments that relate to the declared amount: it should not exceed 2 million rubles. The actual payment will be 13% of 2 million rubles.

If less than 2 million rubles were spent, then after purchasing the second and third home, the client can also contact the tax office, go through all stages of reviewing the application and receive the remaining money. For example, the first room was purchased for 800 thousand rubles; a pensioner will be able to receive a tax deduction only from this amount of money. The legislation allows, after purchasing a second apartment worth 2 million rubles, to draw up documents to receive an additional property tax deduction from the remaining amount from the first purchase: 1,200,000 rubles × 13%. If the money was taken out using a mortgage loan, it is important to remember to also get a deduction for interest. In this situation, you need to wait until the entire interest rate is paid off, and then contact the tax office.

Tax Code, Art. 220. Property tax deductions

The rules in accordance with which mandatory contributions to the budget are made are established by the Tax Code. Art. 220 defines a number of preferential conditions for subjects.

They are determined depending on the specifics of deductions and the circumstances of the appearance of the taxable object. Let's look further at Art. 220 of the Tax Code of the Russian Federation with mi.

The material will reveal the main provisions of the norm, provide notes and explanations to them.

Art. 220 of the Tax Code of the Russian Federation: property tax deductions

In the process of determining the taxable base, in accordance with clause 3 of norm 210, the subject has the right to reduce the amount of contributions to the budget. In particular, he can receive a property tax deduction when selling property, a share in it or the authorized capital of the company. This opportunity occurs when:

1. Leaving the organization.
2. Transfer of funds in connection with the liquidation of the company.
3. Reducing the nominal value of the share in the authorized capital.
4. Assignment, if an agreement was concluded for the purchase of a residential building on the basis of shared participation in construction.

An entity can count on a reduction in the amount of mandatory deduction in the amount of the redemption price of a land plot or a structure located on it, which it received in kind or in cash when the object was withdrawn for municipal or state needs.

When determining the base, the subject can compensate for its actual expenses for the acquisition of an apartment, room, building or shares in them intended for permanent residence, as well as for their new construction. The deduction amount can be reduced by the cost of purchasing a land plot provided for individual housing construction, as well as within the boundaries of which the building being transferred into ownership is located.

Calculation features

A tax deduction is provided to a subject in the amount of expenses incurred by him for the construction or purchase of one or more objects. However, its size should not exceed 2 million rubles.

If a person has used this opportunity partially (received less than the established amount), the balance can be taken into account in the future. For example, a person can again reduce the mandatory contribution to the budget when constructing another structure or receiving an object into personal possession to the extent of the unused amount.

A similar rule applies to land plots and shares in them. The maximum deduction amount is equal to the amount that was in effect in the period in which the subject first had the opportunity to receive it.

When purchasing a land plot or a share in it intended for individual housing construction, the amount of mandatory deduction can be reduced after receiving the relevant title papers in the manner prescribed by the relevant law.

The actual costs of construction or purchase of an object or shares in it may include expenses for:

1. Development of estimates and projects.
2. Purchase of finishing and building materials.
3. Purchase of a building (shares in it), including unfinished construction.
4. Payment for completion or finishing services.
5. Connection to water, electricity, gas supply, sewerage networks or creation of autonomous communications.

Loan repayment costs

Art. 220 of the Tax Code of the Russian Federation allows for a reduction in the amount of deductions by the amount of interest paid on loans of a targeted nature, which were aimed at new construction or the purchase of a room, apartment, structure, or shares in them.

The same rule applies to a land plot that becomes the property of a subject for individual housing construction, as well as having within its boundaries a corresponding building or a share in it. It is worth noting another opportunity provided by the Tax Code. Art.

220 allows for a reduction in the amount of budget allocations by the amount of costs for repaying interest on loans received from banking organizations for on-lending (refinancing) loans for new construction/purchase of an apartment, structure, room or shares in them.

The same applies to land plots that are transferred into ownership, including if there is an object on them.

Conditions

The possibilities provided for in paragraph 1 of Art. 220 of the Tax Code of the Russian Federation, are provided taking into account a number of features. In particular, the size of the proceeds is taken into account. An entity can reduce the amount of budget allocation by:

1. Income from the sale of real estate (apartments, rooms, buildings), including privatized premises, garden, country houses, plots or shares in them, which were owned for less than the minimum period provided for by norm 217.1. Moreover, their size should not be generally more than 1 million rubles.
2. Income from the sale of other real estate owned for less than the minimum period specified in Art. 217.1. The amount of receipts in general should not exceed 250 thousand rubles.
3. Income from the sale of property of a different nature, except for securities, held for less than 3 years. The amount of receipts should not exceed 250 thousand rubles.

The first subparagraph applies to objects purchased after January 1, 2021.

Other cases

When selling property in connection with the liquidation of a company, withdrawal from it, a decrease in the nominal value of a share, or a cession under an agreement on shared participation in construction, the subject may reduce the object of taxation. The amounts of confirmed costs related to the purchase of these valuables are taken into account. Taxpayer expenses may include:

1. Contributions to the authorized capital when establishing an organization or when increasing the company's cash fund.
2. Costs of purchasing or expanding a share.

In the absence of documents certified for the above expenses, the amount of the budget allocation may be reduced by the amount of proceeds received upon termination of participation in the organization. However, in general they should not be more than 250 thousand rubles.

Receipt accounting

Its procedure is also determined by the Tax Code. Art. 220 indicates that when transferring a share in the capital of a company owned by a subject, the costs of receiving it are taken into account in proportion to its decrease. Profit can be paid to the participant in kind or in cash in connection with a decrease in the volume of the company's fund.

In this case, the funds spent by the person on its purchase should be taken into account in proportion to the decrease in the organization’s capital. An increase in the enterprise's fund can occur due to the revaluation of its assets.

In such cases, when reducing the subject's costs, they are taken into account in the amount of the payment exceeding the increase in the nominal value of its share.

Liquidation of a foreign company

The Tax Code (Article 220) in this case also provides for the possibility of the subject to reduce the object of taxation. The procedure applies to the shareholder, founder, shareholder, participant, and controlling person.

When selling property received upon termination of the activities of a foreign company or structure without the formation of a legal entity, the profit from which was exempt from taxation under paragraph.

60 of norm 217, the reduction of the object is carried out by an amount equal to the value of material assets. It is determined in accordance with the accounting data of the liquidated enterprise.

The calculation takes into account information summarized on the date of receipt of property from such an organization. It is indicated in the papers that the subject attaches to the application. At the same time, the value of the property should not be higher than the market value, determined according to the provisions of Art. 105.3 NK.

When selling property rights (shares, interests, including) received from such a company, if its profit in this case and costs in the form of the cost of their purchase are excluded from its revenue/loss in accordance with clause 10 of Art. 309.1, by an entity acting as a controlling or Russian related party, the amount of costs is determined by the lesser of the cost:

1. Certified by credentials. Reporting information is taken as of the date of transfer of ownership rights from the controlled company. The day is determined according to the provisions of Art. 105.3.
2. Market.

In the case of the sale of property that is in common shared or joint ownership, the amount of the deduction is distributed among the co-owners in proportion to the share of each or by agreement.

Exceptions

Unless otherwise provided in Art. 220 NK, then the provisions of sub. 1 clause 1 does not apply to proceeds received from transactions:

1. With securities.
2. Real estate or vehicles used in business activities.

Opportunities for the donor

When he sells property that was received during the dissolution of a trust fund, cancellation of a donation and other cases, expenses are recognized as funds aimed at receiving, storing, maintaining material assets spent on the date of their transfer to the organization that owns the capital.

This provision applies if the return is provided for by the agreement or Federal Law No. 275.

The duration of ownership of real estate received by the donor during the dissolution of capital, cancellation of a donation and in other cases is established taking into account the period of storage of the objects by the subject until the moment of their transfer.

Required papers

An entity wishing to take advantage of the opportunity to reduce mandatory contributions to the budget must provide documents confirming ownership of the property:

1. An agreement to purchase a building, room, apartment, land plot or building on it, or a share in them.
2. Agreement on shared participation in construction and transfer deed (when acquiring rights to an object).
3. Certificate of birth of a child - when parents purchase a house, apartment, room, land plot or shares in them for a minor (or a decision of an authorized body to establish guardianship over a person under 18 years of age).
4. Documents confirming the subject's expenses. These include receipts for orders, bank statements about the transfer of funds from the buyer’s account to the seller’s account, cash and sales receipts, acts of purchase of construction materials, etc.

Note

Tax deduction, which is provided for in subparagraph. 4 clause 1 of the norm in question in the amount of costs aimed at repaying interest on loans of target value received before the date of entry into force of Federal Law No. 212, as well as loans for refinancing these loans, is provided without taking into account the restrictions established by clause 4 of Art. 220.

Amount of reduction by percentage

The deduction provided for in sub. 4 paragraphs 1 art. 220, is provided in the amount of expenses incurred at%, according to the terms of the agreement with the bank, but not more than 3 million rubles. In this case, the person must have identification papers.

These include documents that confirm his right to take advantage of the provisions of the norm in question, an agreement with a credit institution.

The subject also provides papers certifying the costs incurred by him to repay the interest.

Restrictions

Tax deductions are not provided for the costs of a subject for new construction or purchase of a structure, apartment, room (shares in them), covered from the funds of the employer or other persons, family (maternity) capital, allocated for the implementation of additional measures of state support, budget. A similar rule applies to transactions made by interdependent individuals.

Subject Features

Parents (including adopted ones), guardians, trustees who are constructing or purchasing at their own expense a structure, room, apartment, land or shares in them for minor children (wards, wards) can take advantage of the provisions of the norm in question. The amount of the deduction is determined in these cases in accordance with the costs incurred, taking into account the restrictions provided for in paragraph 3 of the norm in question.

Submission of documents to the control body

A tax deduction is provided when the subject submits a declaration at the end of the relevant period, unless otherwise provided for in the norm in question. The ability to reduce the mandatory deduction established in sub. 3 and p.

1, a person can use it earlier than the deadline specified above when submitting a (written) application to the employer.

In this case, the supervisory inspection must confirm his right to apply the provisions of this norm in the form approved by the executive federal body.

Interaction with the employer

Tax deduction established by sub. 4 clause 1 of the norm in question is provided only in relation to one object. A person can obtain it from one or more employers of his choice.

If the deduction was provided by one tax agent, and the subject turns to another employer with the following application, the reduction in the amount of deduction is carried out in the manner determined by clause 7 of the norm in question.

The employer must satisfy the person’s request upon receiving from him the appropriate paper issued by the control body. Confirmation of the rights of subjects is carried out by the tax inspectorate within no more than 30 days. from the date of application.

Additionally

If, at the end of the period, the amount of all the entity’s income received from employers turned out to be less than the amount of deductions provided for in clauses 3 and 4 of the norm in question, the person can take advantage of the provisions of clause 7. If the employer subsequently withheld the amounts without taking into account the reduction, the excess deducted funds must be returned to in the manner specified in Art. 231.

Conclusion

If during the period the deductions established by sub. 3 or 4 clause 1 of the norm in question cannot be used in full; the remainder can be carried forward to the future, unless otherwise provided for by this article.

For entities receiving pensions under current legislation, a decrease in contributions to the budget may be included in previous years, but not more than three. Moreover, they must immediately precede the period in which the transferred balance appeared.

Repeated provision of property deductions provided for in subparagraph. 3 and 4 clause 1, art. 220 is not allowed.