The right to a tax deduction appears in the case when you have carried out certain transactions with property (Article 220 of the Tax Code of the Russian Federation). It could be:
- buying a home - a house, apartment, room, etc.;
- sale of property;
- construction of housing or acquisition of land for these purposes.
To receive a tax deduction, you will need either a registration certificate and a purchase and sale agreement, or a transfer and acceptance certificate and a share participation agreement.
In this article we will look at the situation with purchasing an apartment.
- Who can receive a property tax deduction
- What documents are needed to receive a deduction?
- Amount of deduction and maximum expenses
- How to calculate the amount of deduction
- What is taken into account as expenses when calculating deductions
- Stages of obtaining a property tax deduction
- Obtaining a property tax deduction through an employer
- In 2021, it will be possible to receive a tax deduction without a declaration
Who can receive a property tax deduction
Firstly, only citizens of the Russian Federation who purchased an apartment in Russia can count on the benefit. It is important that you pay your own money for the housing or take out a mortgage.
Secondly, the deduction is provided to those taxpayers who have taxable income at a rate of 13%. To do this, you need to receive an official salary and pay personal income tax on it.
For example, if an individual entrepreneur uses a simplified taxation system, then he will not be able to receive a tax deduction, since “simplified” ones are exempt from paying personal income tax. On the same basis, self-employed people (payers of professional income tax) are deprived of this benefit.
However, both individual entrepreneurs using the simplified tax system and self-employed people can receive additional income subject to personal income tax. For example, they can earn money from their own activities and at the same time work officially in the company. In this case, they will have the right to receive a property tax deduction in the tax period in which income taxed at a rate of 13% was received.
If a taxpayer bought an apartment in 2021 and received a registration certificate in 2020, then starting from 2020 he has the right to a deduction. Therefore, as soon as you have received documents confirming your rights to real estate, begin collecting the necessary papers to receive a property tax deduction.
Property tax deduction for pensioners
We have learned that citizens who pay 13% income tax to the treasury can count on a tax deduction, but what should pensioners do who have purchased a quiet house in the village (maybe for home breeding rabbits) and whose pensions are no longer subject to personal income tax? Can't they get a deduction?
Can. Pensioners can return the tax money they paid for previous periods when they were still working and they paid tax to the budget, but not more than the last 4 years.
For example:
In 2021 you retired, and in 2021 you bought your own home. You will need to wait until the end of the calendar year 2021 and already in 2021 apply to the tax office for a property deduction. Since in 2021 you were on a well-deserved pension, the tax deduction will be returned for the last three working years from 2016-2014.
Note ! You need to apply for a tax deduction strictly the next year after purchasing a home; if this is done later, the possible periods for compensation will be shortened.
If you bought the property after 4 years since you received income and paid personal income tax, then you will be denied a deduction.
The changes also affected working pensioners. Previously, if a person retired but continued to work, he could not count on a tax deduction. Absurd? True, but now this absurdity has been eliminated.
What documents are needed to receive a deduction?
This kit includes:
- passport;
- income certificate in form 2-NDFL, which indicates income and taxes paid for the corresponding year;
- Declaration 3-NDFL, from which it is clear that property was acquired, taxes were paid and that a certain amount of property tax deduction is due.
For the apartment you will need:
- apartment purchase agreement;
- an act on the transfer of an apartment to the taxpayer or a certificate of state registration of the right to an apartment.
If the apartment was purchased through a shared participation agreement:
- an agreement on shared participation in construction or an agreement on the assignment of the right to claim;
- an acceptance certificate or other document confirming the transfer of the object from the developer to the participant;
- copies of payment documents (for example, payment orders, bank statements about the transfer of money from the buyer’s account to the seller’s account).
If the apartment was purchased on the secondary market:
- agreement on the purchase of an apartment (for example, a purchase and sale agreement);
- copies of payment documents (for example, payment orders, bank statements about the transfer of money from the buyer’s account to the seller’s account);
- documents confirming ownership of the apartment (for example, a certificate of state registration of rights).
If you bought a house and land:
- agreement for the purchase of a land plot with a residential building;
- copies of payment documents (for example, payment orders, bank statements about the transfer of money from the buyer’s account to the seller’s account);
- documents confirming ownership of a residential building (for example, a certificate of state registration of title);
- documents confirming ownership of a land plot (for example, a certificate of state registration of rights).
Until 2014, property tax deductions were issued for only one property, but now it can be received from several apartments. The limit on the amount remains the same - no more than 2 million rubles. For example, if an apartment costs 1.5 million rubles, then you can get a deduction of another 500,000 rubles. from the next apartment.
Until 2014, there were no restrictions on mortgage interest. For example, from an overpayment of 10 million rubles. it was possible to get a deduction for the entire 10 million rubles. Starting from 2014, a limit was introduced on the deduction of mortgage interest in the amount of 3 million rubles.
Tax deductions can be obtained not only for real estate, but also for mortgage interest.
For this you need the following documents:
- loan agreement with annexes and additional agreements thereto;
- documents confirming payment of interest on the mortgage (for example, a certificate from the bank).
The deduction is issued for the interest actually paid. For example, if a mortgage agreement was signed for 10 years 3 years ago, then a tax deduction is issued for the amount of interest paid for 3 years. Interest paid in the following year will be tax deductible in the following year.
When can I get my tax refund?
An application for a refund of the amount of overpaid tax can be submitted within three years from the date of payment of the specified amount (clause 7 of Article 78 of the Tax Code of the Russian Federation). In other words, if a taxpayer filed an application for a deduction in 2021, then he will be able to receive a deduction from income of previous periods only for 2021, 2021 and 2021. In this case, the moment of acquisition of the apartment does not matter, since there are no restrictions on the period of application for deduction on this basis (letter of the Department of Tax and Customs Tariff Policy of the Ministry of Finance of the Russian Federation dated April 29, 2014 No. 03-04-05/20134).
If the right to a tax deduction arose in 2021, then it will not be possible to receive a tax refund for the periods preceding this year: its balance can be carried over to subsequent tax periods until they are fully used. However, this rule does not apply to pensioners who, when purchasing housing, have the opportunity to transfer the balance of the property deduction to the three tax periods immediately preceding its occurrence (clause 10 of Article 220 of the Tax Code of the Russian Federation).
Example:
The employee retired in 2021. In 2021, she bought an apartment. Since documents for deduction are submitted at the end of the tax period, in this case you can contact the Federal Tax Service in 2020.
She will not receive a deduction for 2021, since she no longer worked and did not receive taxable income. But she will receive a property deduction for 2021, 2021 and 2021. When calculating the deduction for 2021, the months when the citizen was still working will be taken into account.
To do this, the pensioner must submit three declarations to the Federal Tax Service in form 3-NDFL.
Amount of deduction and maximum expenses
There are some nuances with the registration of deductions depending on the type of property.
- Sole proprietorship . When buying an apartment, you can return the property tax deduction, but not more than 2 million rubles. 13% of the cost is refundable. By purchasing an apartment for 2 million rubles, you can return 260,000 rubles. previously paid taxes, and for 1 million rubles. — 130,000 rub. If the purchase price is more expensive, the refund amount will not change.
- Common shared ownership . For example, when purchasing ½ share in an apartment for 3 million rubles. You can apply for a deduction of no more than 1.5 million rubles.
- Common joint property . Until 2014, spouses for two could receive a deduction of no more than 2 million rubles. Therefore, it was more profitable to issue a deduction for only one of the spouses, and the other could receive another tax deduction in the future. Since 2014, the limit is 2 million rubles. are established not per property, but per person. For example, if the cost of an apartment is 5 million rubles, then each spouse can receive a deduction of 2 million. If the apartment costs 3 million rubles, you can agree to make a deduction of 1.5 million rubles, and then each 500,000 rubles remain, which can be used for the following objects.
Features of applying for a property deduction
- Limit amount of deduction - 2,000,000 rub.
.
You can return up to 13% of the expenses incurred, but not more than 260,000 rubles
(excluding the amount of overpayment to the mortgage loan).If an apartment is purchased during marriage after 2014, then each spouse can receive a deduction in the amount of RUB 2,000,000. The total deduction for the family will be equal to 4,000,000 rubles.
- In one year, you can return no more
than was transferred to the income tax budget at a rate of 13%, but you can return the tax over several years until the entire amount is received (260,000 rubles). - From January 1, 2014
the restriction associated with receiving a property tax deduction for only one piece of real estate
has been abolished
.Therefore, for objects for which the certificate of registration of rights
property (transfer and acceptance certificate) was received
after 01/01/2014
, the deduction can be used until it is
completely spent
(for an unlimited number of real estate objects). - Deduction for expenses for interest payments
for a mortgage, it is provided
only for one
property (even if they were purchased after January 1, 2014).The amount of the “mortgage” deduction is 3 million rubles.
, if the property was acquired after 2014 and
unlimited
- if before 2014. Thus, for an apartment purchased before 2014, it will be possible to return 13% of the entire overpayment on the loan, and after 2014 - only from 3,000,000 rubles.note
, the deduction for mortgage interest
since 2014
can be claimed separately from the main deduction, if it was not previously included in it.
Until 2014,
it was possible to receive a deduction for the cost of repaying mortgage interest only as part of the main deduction and a separate application for it was not provided. - When purchasing property in common shared ownership until 01/01/2014
the deduction is distributed among the owners according to the share of each of them (the exception is the purchase of housing in joint ownership with minor children, in which distribution of the deduction by shares is not required). The deduction amount is 2 million rubles. for a residential property.
When purchasing property in common joint ownership before 01/01/2014.
the deduction is distributed according to an agreement between the spouses and also cannot exceed 2 million rubles. in general for purchased real estate.
Since 2014
The deduction is provided for actual expenses incurred on the purchase of housing, regardless of the form of ownership in which it is registered. The deduction amount is 2 million rubles. for each owner. In this case, the size of the share of the co-owner of the property does not matter. Each of the co-owners can claim a deduction for their share in the amount of no more than 2 million rubles.
- If housing was purchased during marriage, it does not matter which of the spouses the documents were issued for and who paid for the housing. If one of them had no income during the reporting period, when submitting documents for deduction, it is necessary to draw up an application for the distribution of expenses between the spouses
.
How to calculate the amount of deduction
The maximum deduction amount is: 2,000,000 x 13% = 260,000 rubles. This amount can be applied to several purchased residential properties if their total cost is less than 2 million rubles. (clause 3 of article 220 of the Tax Code of the Russian Federation).
If real estate is purchased by spouses, then each of them has the right to a maximum deduction amount of 2 million rubles.
If a loan was taken out to purchase property, you can receive a deduction of no more than 3 million rubles for interest. The maximum deduction amount is: 3,000,000 x 13% = 390,000 rubles.
Amount of deduction per apartment
The amount of money returned directly depends on the cost of the purchased residential property and the amount of 13% of your income officially paid during the calendar year.
But you need to keep in mind that the amount of money presented for this deduction cannot be higher than two million rubles. Until December 31, 2007 inclusive, the maximum amount was only one million rubles. It was for this amount of expenses that one could present and receive a percentage compensation payment.
The annual amount claimed for refund cannot exceed the amount of income tax transferred by the citizen from his official salary. You can apply for a refund of the entire amount of expenses from the purchased real estate for several years until this amount is fully restored.
For reference: Mortgage housing costs are paid in full only from property that became your property no later than December 31, 2013. After this period, the amount claimed for refund cannot exceed three million rubles.
What is taken into account as expenses when calculating deductions
If you purchase an apartment, then the costs take into account:
- the purchase of real estate itself;
- acquisition of rights to an apartment in a building under construction;
- spending on finishing materials;
- apartment finishing work, development of design and estimate documentation.
If you buy a house or build one, then the costs include:
- development of design and estimate documentation;
- purchase of building materials, as well as finishing materials;
- the purchase of a house itself, including at the stage of unfinished construction;
- house construction and finishing work;
- carrying out electricity, water and gas supply and sewerage.
Stages of obtaining a property tax deduction
So far the process consists of four stages. But most likely, already in 2021, a bill will be adopted that will amend the Tax Code in terms of introducing a simplified procedure for obtaining tax deductions for personal income tax. The deadline for submitting amendments is February 24, 2021.
Step 1. Collect copies of all necessary documents
Copies of documents confirming the right to housing:
- when constructing or purchasing a residential building - a certificate of state registration of the right to a residential building or an extract from the Unified State Register;
- when purchasing an apartment - a purchase and sale agreement, an act of transfer of the apartment to the taxpayer, a certificate of state registration of ownership or an extract from the Unified State Register of Real Estate;
- when purchasing a land plot for construction or ready-made housing - a certificate of state registration of ownership of the land plot and a certificate of state registration of ownership of a residential building;
- when paying off interest on a mortgage - a mortgage agreement, a schedule for repaying the loan and paying interest on the use of borrowed funds.
Until 2021, to receive a deduction, it was enough to provide a certificate of state registration of the right. But in 2021, there were changes in confirming the right to a property deduction when purchasing real estate (Federal Law dated July 3, 2016 No. 360-FZ). If you purchased real estate after July 15, 2021, then the right to a property deduction will have to be confirmed with an extract from the Unified State Register.
Copies of payment documents:
- confirming expenses for the acquisition of property (receipts for receipt orders, bank statements about the transfer of funds);
- evidence of payment of interest under the mortgage agreement (certificate of interest paid for using the loan).
Stage 2. Take certificate 2-NDFL from work
Just contact the accounting department - they will prepare it.
Step 3. Fill out the 3-NDFL declaration
You will need data from your passport, 2-NDFL and other documents.
Please note that Form 3-NDFL is updated annually, but you must use the one that corresponds to the year for which the personal income tax is being returned.
On its website, the Federal Tax Service provides an example of filling out a tax return in Form 3-NDFL.
If the property was purchased as a common joint property, you must provide:
- a copy of the marriage certificate;
- a written statement on the agreement of the spouses on the distribution of the amount of property tax deduction.
Please note: the new form 3-NDFL includes a statement for a refund of the amount of overpaid tax. It also needs to be filled out so that the tax office can transfer the amount to you.
Until 2021, the application had to be filled out separately using a special approved form (Order of the Federal Tax Service of the Russian Federation dated February 14, 2017 No. ММВ-7-8 / [email protected] ).
In your application please indicate:
- Name of the bank;
- bank account details to which the amount must be transferred (the amount in the application must match the amount indicated in the declaration).
Step 4. Submit a set of documents to the tax office
The package of documents is submitted either to the tax office at your place of residence in person, or through your personal account on the Federal Tax Service website. Specialists check documents within 3 months. If any questions arise, you will be contacted and asked for original documents. If everything is in order, the money will be credited to your account. In general, the procedure for obtaining a property tax deduction takes a maximum of 4 months.
How many times can you get a property deduction in 2021?
Until 2021, it was possible to return 13% of citizens’ expenses for the purchase of residential real estate or its construction only once in a lifetime.
From January 1, 2021, it became possible to apply for a property deduction again. Because previously it was tied to the price of the property sold, and now - directly to the buyer, that is, to the taxpayer.
The number of home purchase transactions for which a deduction is possible does not have any restrictions.
Having received a return on one property, citizens can make it in the future when purchasing other property.
Obtaining a property tax deduction through an employer
If you contact your employer, you can receive a property tax deduction before the end of the tax period. In this case, filing a 3-NDFL declaration is not required.
What do you need:
- Write an application (in any form) to receive a notification from the tax authority about the right to a property deduction. You can use the form that the Federal Tax Service recommends in Letter dated October 6, 2016 N BS-4-11 / [email protected] But it is much easier to submit an application through the taxpayer’s personal account, since there is already a special form there.
- Make copies of documents confirming your right to receive a deduction. Upload them to the taxpayer’s personal account and sign with an electronic signature (there is no need to specially obtain it, it is generated automatically).
- Submit to the tax authority an application to receive notification of the right to a property deduction, attaching copies of documents confirming this right.
- After 30 days, receive a notice of the right to deduction from the tax authority and give it to your employer.
- Provide a notice issued by the tax authority to the employer, which will be the basis for not withholding personal income tax from the amount of income paid to an individual until the end of the year.
A notification from the Federal Tax Service is the basis not to withhold personal income tax from the salary paid to an employee in the current tax period, and the main document confirming the right to deduction, therefore, upon receiving the notification, you must check whether all your data and details are correct.
Yulia Rybalko Leading payroll specialist in legal
note
- There is no statute of limitations for obtaining a property tax deduction. For example, you can receive a tax deduction even 10 years after purchasing an apartment.
- If you file a deduction yourself, then at the tax office, after the end of the tax period, you can count on a one-time full amount of 13% of your income earned during the year. If the deduction is issued through the employer, then the personal income tax refund will occur before the end of the tax period if the tax office confirms the right to the deduction. This will allow you to receive your salary without personal income tax withholding, starting from the month in which you received the notice from the tax office.
- According to paragraph 9 of Art. 220 of the Tax Code of the Russian Federation, if property tax deductions cannot be used in full during a tax period, their balance can be transferred to subsequent tax periods until they are fully used. Depending on the taxpayer’s earnings, personal income tax refunds may take several years.
The amount of payments and the procedure for their execution
Every working citizen has the right to receive income tax compensation after purchasing real estate. Today there is a limit on the value of real estate from which deductions can be made. It amounts to 2 million rubles per person. In this case, 13% of the specified amount is returned to you, which equals 260 thousand rubles. If the price of the purchased property is less than the limit, then the citizen retains the right to receive the remaining amount in the future.
In addition, the amount of compensation directly depends on the amount of taxes that your company pays for you, since after all the documents are completed, you will only be transferred the previously paid amount to the budget. That is, if last year you paid income tax for the year in the amount of 40 thousand rubles, then when you apply for a deduction, you will receive exactly this amount as a deduction for this period.
Attention! To apply for a deduction, you must submit a Form 3 personal income tax declaration to the tax office at your place of registration, in which you should indicate the acquired property and its value. In this case, the calculation of the deduction amount will be made for the previous year or, in some cases, for the last 3 years.
In addition to these papers, you will need to provide originals and copies of the following documents:
- passport and TIN;
- certificate of registration in the Rosreestr of real estate or an act of transfer of property into the ownership of a citizen;
- 2-NDFL certificate for previously paid income tax (can be obtained at your place of work);
- application for a refund for purchased real estate;
- papers confirming the conclusion of the purchase and sale transaction and your expenses associated with the purchase of real estate.
When registering property as joint property of spouses, the INS may be required to provide an application for the distribution of deductions between married persons.
After submitting documents to the local branch of the ITS, inspection staff check them. This procedure takes about a month, after which funds are transferred to the citizen’s bank account specified in the application.
Attention! If necessary, the inspection period can be extended to 2-3 months.
As a rule, documents are submitted at the beginning of the calendar year, but this is not mandatory. You can contact the tax office directly after registering the apartment and receiving the necessary documents. However, for the convenience of making calculations, experts recommend submitting documents in the second half of January, immediately after the holidays.
Separately, it is necessary to consider the situation when, after purchasing an apartment, a sufficiently long time has passed during which the citizen has not applied for the transfer of compensation. Currently, the rule is that a person who purchased real estate after 2014 has the right to receive a tax deduction at any time. Even if 5 years pass, you will retain the right to transfer compensation. However, it is important to remember that in this case, only the last 3 years preceding the submission of the application will be taken into account in calculating the deduction amount.
Only funds already paid for taxes for the previous period are transferred to the personal account. If the amount of this compensation is less than the established amount, then you have the right to receive the remaining funds in future reporting periods. To do this, you will need to obtain a certificate (written notification) from the INS about the right to a tax deduction. This paper is provided to the accounting department of the enterprise where you work. Starting from the next billing month, your salary will be transferred without deduction of income tax from it.
If you are registered as an individual entrepreneur, then the corresponding calculations can be made by a hired accountant or you yourself. In this case, when filing a declaration in future periods, you will need to note that you have completed the deduction and attach a copy of the certificate from the INS.
In 2021, it will be possible to receive a tax deduction without a declaration
Already in the spring of 2021, the process of obtaining a deduction can be automated and therefore simplified. On January 26, the State Duma adopted in the first reading a bill on providing personal income tax deductions online.
The Federal Tax Service promises that in order to return personal income tax, it will be enough to simply fill out an electronic application generated in your personal account on the Federal Tax Service website. You won’t have to worry about filing declarations and certificates. And tax authorities will be able to receive information about the right to deduction without the participation of taxpayers. For example, if the purchase of an apartment is carried out with the participation of a bank, then the information necessary for a tax deduction will be received by the tax authority from the bank.
The law will make life easier for many.
The pandemic has shown us how important it is to develop digital technologies, to make access to government services remote, so that people can use them in any situation. Vyacheslav Volodin Chairman of the State Duma
Earlier, the press service of the Federal Tax Service explained to Rossiyskaya Gazeta that the improved procedure will reduce the time required to receive deductions - from 3 to 1.5 months.
