As many people know, in almost all countries of the world, any transaction with re-registration of real estate entails significant tax obligations. Ukraine is no exception. At the same time, despite the complaints of many sellers, in fact in our country, taxes on the sale of real estate are not as high as in many other countries of the same European Union.
Our appraisers are often asked to consult not only on the direct valuation of real estate. But also for the costs that will accompany the transaction. So we decided to systematize all this information in this article.
At first glance, if you read the Laws and Codes themselves, the principles of taxation on the sale, gift or inheritance of real estate may seem rather confusing. However, if this information is systematized, everyone interested without problems will understand this issue.
Pay attention! Our tables do not take into account two more types of incidental costs when registration of real estate:
- Notary’s services or state fee. It is considered that notary services are called «state fee» and make 1% from the estimated value of the real estate. Some people say that only a notary of state takes state fees, and prices from private notaries are formed by agreement with the client. These norms are rather confusing and change frequently. Therefore, we recommend to ask a number of notaries about the upcoming costs before executing the transaction. And as a result, choose the most liked of them.
- The payment for expert evaluation. Details of prices can be found at main page of our website, and also on the relevant sections about apartments, residential buildings, land plots, premises, garages or other real estate.
Three types of taxes (fees) are paid as a result of real estate re-registration operations (sale, donation, inheritance):
- Income tax. It is the same Personal Income Tax (PIT). The basis for the payment of this tax and its rate depends on:
- type of real estate transaction (sale, donation, inheritance);
- length of ownership (up to or more than three years);
- degree of kinship in the gifting of property;
- Ukrainian or foreign citizenship of the parties of the contract.
- Military fee. Not paid only in case of donation to close relatives or inheritance also from nearest family members.
- Pension fund fee. Is paid only in purchase and sale transactions of immovable property.
Let’s structure all this information in a simple and clear tabular way.
Taxes and fees on the sale, gift or inheritance of real estate.
If the seller, gifted/donator or heir/testator – citizens of Ukraine (residents)
| The seller, gifted/donator or heir/testator – citizens of Ukraine (all parties to the contract) | |||
|---|---|---|---|
| Transaction | Income tax (PIT) | Military fee | Pension fund |
| Sale of apartment or house, right of ownership more than 3 years | — | 1,5% (seller pays) | 1% (buyer’s payment) |
| Sale of apartment or house, right of ownership less than 3 years | 5% (seller pays) | 1,5% (seller pays) | 1% (buyer’s payment) |
| Sale of premises, buildings, garages | 5% (seller pays) | 1,5% (seller pays) | 1% (buyer’s payment) |
| Gifting of real estate or inheritance to close relatives (spouses, children, grandchildren, siblings) | — | — | — |
| Gifting of real estate or inheritance except close relatives | 5% (pays the gifted or the heir) | 1,5% (pays the gifted or the heir) | — |
If the seller, gifted/donator or heir/testator is a foreigner (non-resident of Ukraine)
| Real estate seller, gifted/donator or heir/testator is not a citizen of Ukraine (at least one of the parties to the contract) | |||
|---|---|---|---|
| Transaction | Income tax (PIT) | Military fee | Pension fund |
| Sale of apartment or house | 18% (seller pays) | 1,5% (seller pays) | 1% (buyer’s payment) |
| Sale of premises, buildings, garages | 18% (seller pays) | 1,5% (seller pays) | 1% (buyer’s payment) |
| Gifting of real estate or inheritance | 18% (pays the gifted or the heir) | 1,5% (pays the gifted or the heir) | — |
As can be seen from the tables, taxes and fees are calculated based on the estimated value of the real estate. Therefore, when preparing documents for notarial registration must be ordered the property evaluation. We will gladly help you with this issue. Welcome!
