Land tax for individual entrepreneurs: exemption, benefits, calculation formula. 3 examples

Hello! In this article we will talk about the features of paying land tax by an individual entrepreneur.

Today you will learn:

1. In what cases does an individual entrepreneur need to pay land tax;
2. When land tax is not taken into account;
3. How to calculate tax payable;
4. Should an individual entrepreneur pay land tax using the simplified tax system?

Land tax

The generally accepted taxation system also includes a tax on land use. If you are the owner of a plot, you are required to pay contributions to the treasury for it. This applies to individuals and legal entities.

Land tax is regulated by three main legal acts:

• Law No. 141 of 2004;
• Law No. 382 of 2014 (everything related to changes in accrual);
• Tax Code, in particular Chapter 31.

There are two main tax rates that are adopted at the state level. They are the maximum possible for each region. Local authorities can reduce this rate, thereby reducing the tax burden in a particular region of the country.

Basic tax rates:

• 0.3% – for agricultural land in urban areas, construction of housing and communications, maintaining your own garden or vegetable garden, personal breeding of domestic animals; lands used for customs, security or defense purposes;
• 1.5% – for all other types of land plots not included in the above list.

Within one region, the land tax rate can be differentiated, that is, different between individual taxpayers. This rule is set at the discretion of the local administration.

You can find out the rate that applies in your region of residence via the Internet or by contacting the authorities directly. If you want to find information online, you need to visit the official website of the tax service of the constituent entity of the Russian Federation.

To find an accepted bet, follow these steps:

• Specify region;
• Go to the “Electronic Services” section;
• Select the “Betting Information” link;
• Indicate the tax of interest, namely land tax;
• Select a period;
• On the map that appears, mark the location of your site;
• Click on the “Search” button;
• You will see a table with a regulatory act that sets the rate in the selected region;
• On the right in the table you will see a link to the document, click on it to access the information;
• In the file that opens you will find all the necessary information.

Nuances

Peculiarities in the payment of taxes by organizations and individual entrepreneurs can be associated with the use of a patent or “simplified code”.

Land tax under the simplified tax system

Payment transactions can be facilitated by using the so-called “simplified tax system” (simplified taxation system). This system allows a number of operations to be performed online. These operations include the calculation of land tax.

When an entrepreneur uses this program, he is freed from the constant stress that is associated with meeting payment deadlines and carrying out settlement transactions.

Taxation of organizations under the simplified tax system

The program operates in accordance with regulations adopted at the regional level, which determine the amounts and deadlines for payment, and the need to make advance payments.

Using the program is convenient for users, as it is multifunctional. To calculate the tax, you need to enter data, and the system will prepare the amounts required for payment.

The system provides the ability to calculate tax for the entire period from an entire plot, also for part of a land plot, if there are partners. The determination of the amount can be made for part of the period.

As an element of the system under consideration, a patent regarding land tax has been developed. It is intended to help individual entrepreneurs. Today, a patent is applied to various types of tax payments and has autonomous force.

The patent seems to be a limited list of IP applications in relation to certain areas of activity. This is the main difference from the “simplified” one. A patent is represented by a separate type of tax regime, which has the ability to replace the payment of tax payments.

This means that the entrepreneur has the right to buy a patent instead of paying tax. To purchase, an individual entrepreneur submits an application to the authority in charge of taxation issues. An application is submitted at the location of the company.

Land tax 2021 for legal entities

The tax for a land plot by organizations and individual entrepreneurs must be paid on time and in fixed amounts. If the legislation in force in this direction is violated, the perpetrator is held accountable for this violation.

The tax system burdens not only citizens, but also legal entities. In relation to legal entities, increased requirements regarding this obligation are provided, but despite this, it must be fulfilled properly.

Does the individual entrepreneur pay land tax?

In matters of payment of land tax, an individual entrepreneur is treated as an individual. If your activity, one way or another, involves the use of an allotment that brings in cash, then you must pay tax.

The mandatory contribution is paid in the following cases:

• If the land is privately owned;
• The allotment was transferred for indefinite use;
• With lifelong inheritance.

If you have title documents for the land you are using, then you are a taxpayer. Moreover, this type of collection is municipal, that is, all contributions are sent to the local budget, and not to the general treasury of the country.

Should an individual entrepreneur submit a land declaration using the simplified tax system?

To pay land tax as an individual entrepreneur using the simplified tax system, you do not need to submit a declaration. The tax office independently calculates the tax.

Formula for calculating land tax:

ZN = KS × CH × K

Where:

ZN - land tax;

KS - cadastral value (the assessment is carried out by Rosreestr and transmits the data to the tax office);

SN - tax rate;

K - ownership coefficient (calculated if the land is owned for less than 12 months).

Rates for calculating land tax:

• 0.3%: land for agriculture, livestock breeding;
• land for housing and communal services and residential buildings;
• land for personal farming, gardening;
• lands used for customs and defense facilities;

But local authorities have the right to set other rates.

Federal tax benefits:

• Categories of citizens exempt from land tax: Peoples of the Far East, Siberia, the North, recognized as indigenous and small in number.

Local Administrations have the right to establish additional benefits. All explanations on local benefits and tax rates are available on the Federal Tax Service website in the “Reference Information” section.

But to receive the benefit, you need to submit an application (KND form 1150063) to the tax office - without your application, the Federal Tax Service will not take it into account.

We recommend reading: Taxes and reporting of individual entrepreneurs on the simplified tax system 6% + what is considered income and how to work with primary documents.

Calculating taxes

Not all beginning entrepreneurs know whether they submit a land tax return. Currently, individual entrepreneurs are exempt from drawing up and filing a declaration.

Previously, it was necessary to submit reports to the tax service, but now individual notifications with the amount are sent to the entrepreneur’s address.

Such notifications are sent before October 31 of the year following the reporting year. That is, for taxes for 2021, the payment letter will arrive in October 2021. Payment deadlines end on December 1st after receiving a receipt from the tax office.

There are often cases when the tax authority does not send notifications. It is important to understand that this does not exempt you from paying the fee. For late repayment of debt, penalties will be charged from your account, regardless of whether the tax authority sent the notification on time or not.

Therefore, if a payment receipt has not appeared in your mailbox by October 15, we recommend visiting the tax authority to clarify the circumstances and receive a notification.

Depending on what dates in the month you purchased the plot, that month may or may not be included in the payment.

A full month will be taken into account if:

• The plot is registered from the 1st to the 15th of the month (for the buyer);
• The plot was sold from the 16th to the 31st (for the seller).

The month of purchase/sale will not be taken into account for tax purposes if:

• The plot was purchased from the 16th to the 31st (for the buyer);
• The plot was sold from the 1st to the 15th (for the seller).

The land tax payment process includes the following steps:

• The tax authority draws up a notice of payment with a receipt;
• The document is sent to the individual entrepreneur’s registration address;
• The entrepreneur pays the tax using the specified details at any bank that provides such a service.

Land tax is payable once a year. For individual entrepreneurs, advance payments are not provided - this means that the entire tax amount must be paid at once.

Payment of land tax for individual entrepreneurs: procedure, deadlines, documents

If you have registered an individual entrepreneur, then you do not need to worry about calculating land tax and submitting reports to the Federal Tax Service. The fiscal service will carry out all the necessary actions, all you have to do is pay the tax on time.

When paying tax, an individual entrepreneur who owns a land plot acts according to the following simplified procedure:

Current legislation does not require entrepreneurs to provide any reporting regarding land tax.

Payment benefits

The state has created benefits for paying taxes on land plots for certain categories of citizens. Exemption from contributions is carried out on a full or partial basis.

The tax base for the following persons is reduced in the amount of 10,000 rubles:

• Disabled people of groups 1 and 2;
• Disabled since childhood;
• Heroes of the USSR or the Russian Federation;
• WWII veterans;
• Participants in man-made disasters and persons taking part in their liquidation (persons exposed to radiation).

For these categories, 10,000 rubles are deducted from the tax base. Also, each region can establish additional benefits. For example, in some areas there is a regulation establishing the area of ​​the plot that is not subject to tax.

If the plot is larger than this area, then only a contribution is paid for the difference between the actual size and that established by law. For those whose plot is less than or equal to the area specified in the legal document, the tax is equal to zero.

If you are the owner of several plots in different regions, then you are entitled to benefits for each individual plot. If you own lands within one subject of the Russian Federation, then you can use only one of them for preferential tax purposes.

Benefits for individual entrepreneurs

The calculation of the land tax of individual entrepreneurs is carried out taking into account the rules established by Tax legislation and the municipality of the corresponding locality. An individual entrepreneur is exempt from paying the fee if:

• the occupied territory is limited in circulation or completely withdrawn from it;
• the occupied lands are included in the forest or water fund.

Benefits are provided to certain categories of citizens and legal entities using land for personal purposes. If the intended purpose of the site is to conduct business, then taxation is carried out on a general basis.

Who doesn't pay tax

In addition to the current benefits for the population, there is also the possibility of complete exemption from paying contributions.

This rule applies throughout the Russian Federation and applies to areas:

• Managed by the forest fund;
• Seized as a result of a decision of local authorities (for example, for the purposes of a nature reserve or the disposal of radioactive waste);
• Limited in use (occupied by cultural heritage or natural water bodies);
• Used for highways;
• Being the common property of an apartment building;
• Available for free use;
• Rented (in this case the owner of the plot pays the tax);
• Inhabited by small numbers of indigenous people (if the plot is used for living and conducting their own fishing).

The owner has the opportunity to reduce the value of the tax base. This is due to the cadastral value, which may not always be adequate.

If you think that the price of your plot is too high (and the higher it is, the higher the tax to be paid), you need to invite an independent appraiser who, based on experience and knowledge, will draw up a document on the real value of the property.

With the received certificate, you need to contact the commission for the consideration of such disputes. If the issue is not resolved in your favor pre-trial, then it is necessary to file a statement of claim.

Land tax

The Russian Tax Code (Article 388) obliges entrepreneurs to make payments on land plots. It arises if the relevant property belongs to a businessman on the basis of property rights, inheritance, and perpetual use.

In accordance with the general rule, an entrepreneur acts as a payer of land tax if two conditions are simultaneously met:

• ownership is documented for the businessman;
• the land plot is located on the territory of a constituent entity of the Russian Federation in which the corresponding tax applies.

If for some reason individual entrepreneurs do not have documents confirming their ownership, two situations are possible:

1. A businessman does not have an obligation to pay the corresponding royalties if the land was purchased after January 31, 1998, but the right to it was not registered. It is important to remember that deliberate evasion of state registration of land to reduce taxes threatens the entrepreneur with a fine. The amount will be considerable and amount to up to 40% of the tax penalty.
2. If the land plot was acquired before January 31, 1998, the individual entrepreneur is obliged to pay land tax even in the absence of ownership papers. This is because in this situation it is possible to prove ownership of other documents, for example, a purchase and sale agreement.

It is important to know that there are conditions under which businessmen are exempt from paying.

Such situations can be divided into three main groups. All of them provide tax benefits.

The first group includes situations that arise taking into account the characteristics of the earth:

• the site belongs to the forest fund;
• according to the law, the land is withdrawn from circulation;
• there are restrictions on turnover;
• the site is occupied by cultural heritage sites or related to the water fund;
• the land is part of the property of a multi-apartment fund.

The second group includes situations related to the law, as a result of which individual entrepreneurs own land. You will not have to make payments on the land if the businessman uses the land on the basis

and rights of free use or under a lease agreement.

Indigenous minorities are exempt from paying taxes. This applies to areas where living, farming and fishing are carried out.

Tax amount

There is a simple formula to calculate the contribution payable:

Land tax = tax rate adopted in the region * cadastral value of the plot.

The cadastral price is updated on the 1st day of the reporting year (the one for which the tax must be paid).

For example, the cadastral value is 578,000 rubles. The tax payable at a rate of 0.3% will be; 578000*0.3% = 1734 rubles. If a rate of 1.5% is applied, then the tax will be equal to: 578,000 * 1.5% = 8,670 rubles.

The cadastral value and the applicable tax rate will be indicated on the payment receipt. If you have payment benefits, they must be recorded with the tax office. To do this, you will need to collect a package of documentation confirming the availability of benefits and provide it to the operator for further accounting.

Calculation examples

For greater clarity, it is worth considering examples of calculations of land payments depending on various conditions:

1. Standard situation. We will calculate the land tax for an individual entrepreneur who owns a plot with the following characteristics:

• cadastral value in 2021 - 120 thousand rubles;
• type of activity - provision of entertainment services to the population (a swimming pool is located on the site);
• The period of ownership during one tax period is a whole year.

Since the type of activity of an individual entrepreneur does not fall under any of the categories for which a rate of 0.3% is applied, in this case it is 1.5% (its value is not reduced by local legislation).

Therefore, the tax amount will be:

ZN = 120,000 * 1.5% = 1,800 rubles.

Thus, before December 1, 2021, the entrepreneur will have to pay land tax for the previous period (that is, 2016) in the amount of 1.8 thousand rubles.

If the land was used for agricultural purposes, for livestock farming or gardening, then the tax amount would be significantly lower:

ZN = 120,000 * 0.3% = 360 rub.

Obviously, the amount payable to the budget in the second case is much less, which was done, in particular, with the aim of supporting and stimulating the activities of entrepreneurs engaged in the agricultural sector.

2. Tax on a plot that is jointly owned by several persons. In some situations, an entrepreneur can use a plot that belongs not only to him, but also to several other entities, that is, it is in joint or shared ownership. In this case, he will have to pay only the amount of payment that is established specifically for his part of the land. It can be determined in two ways:

1) In accordance with the share of each owner. This option applies to situations where the certificate of title clearly indicates which part of the land belongs to a specific entity. In this case, the tax amount will be distributed among all payers precisely in accordance with these shares.

For clarity, it is worth considering an example with the same data as above, but only in relation to a plot owned by three owners in the following shares:

• 0.1 (10%) - owner No. 1;
• 0.3 (30%) - owner No. 2;
• 0.6 (60%) - owner No. 3.

In this case, the cadastral value of the plot for each of them will be:

• owner No. 1 - 120,000 * 10% = 12,000 rubles;
• owner No. 2 - 120,000 * 30% = 36,000 rubles;
• owner No. 3 - 120,000 * 60% = 72,000 rubles;

Thus, the land tax will be:

• owner No. 1 = 12,000 * 1.5% = 180 rubles;
• owner No. 2 = 36,000 * 1.5% = 540 rubles;
• owner No. 3 = 72,000 * 1.5% = 1080 rub.

This method allows you to distribute the tax burden as fairly as possible among all land owners.

2) Equally between everyone. This option is used in cases where the land is in common ownership of the subjects, without allocating specific shares. In such a situation, it is considered that they own the property completely, therefore the amount of land tax for each of them will be the same:

ZN = 1800 / 3 = 600 rub.

3. Taxation when owning land for less than a full year. The formula for calculation can

be supplemented with a correction factor if the entrepreneur has owned it for more than a year. For example, suppose that a plot with the above characteristics was acquired by an individual entrepreneur on May 26, 2016. In this case, the exact period when the property was in his ownership is 8 months (May is taken into account in full).

Therefore, the tax amount will be:

ZN = 1800 * 8/12 = 1200 rub.

The same applies to situations where the plot was sold during the year - the individual entrepreneur will only pay for the number of months when the land was actually in his ownership.

4. Tax calculation if the entrepreneur has benefits. The right to benefits is granted to certain categories of payers, subject to their compliance with legal requirements. In particular, the federal benefit for individuals (including individual entrepreneurs) involves reducing their tax base by 10 thousand rubles.

Let's assume that in the above example the entrepreneur is disabled and has the right to receive benefits. In this case, the tax will be:

ZN = (120,000 – 10,000) * 1.5% = 1,650 rubles.

Thus, the amount of tax after applying the benefit was reduced by 150 rubles. (1800 – 1650). However, it is worth considering that additional benefits may also be established by regional authorities - in this case, the amount of reduction in the tax base may be significantly higher.

Certain categories of payers may be completely exempt from their tax obligations.

The establishment of an easement can occur both with the consent of the owner (private) and without his consent (public). How to properly buy a plot of land from the owner and what nuances should be taken into account? Find out about it here.

Why is land surveying tedious and in what cases is it mandatory? You can read more about this in our article.

Certain cases of tax payment

Let's consider non-standard situations of paying land taxes. The first such case is taking into account the mandatory contribution for joint ownership of a plot. If there are several owners of one plot, then they pay land tax in proportion to their share.

Example. You own a plot of 75 square meters. Your plot is part of one large plot of 238 square meters. The total cadastral value of the land is equal to 300,000 rubles. Since the plot is used for breeding livestock for sale, the tax rate is 0.3%. First you need to calculate the cadastral value of 75 square meters. It is equal to: 300,000*75/238 = 94,538 rubles. The tax amount will be: 94538*0.3% = 283 rubles.

It is important to understand that if you are the owner of the participant jointly with the state authorities, you will pay tax on the entire plot. Even if you only use a small plot, the fee will be charged on all square meters.

This is due to the peculiarities of state ownership of land. Local authorities are limited in the ways they can dispose of land, and therefore are exempt from paying taxes.

Let's consider the second case, when the plot was in your ownership for an incomplete number of years.

Example. The plot was purchased on May 23, 2021. On January 1, 2021, the cadastral value was 652,000 rubles. The region has a rate of 0.3%. For tax purposes, only the months from June to December are accepted, since the property was purchased in the second half of May. We get the amount of tax to be paid: 652000*0.3%/12*7 = 1141 rubles.

There are also situations in which, when paying land tax, both benefits and an incomplete number of months of use of the site are taken into account.

Example. A disabled person of the 1st group registered an individual entrepreneur in August 2021. For business purposes, a citizen acquired a plot of land on November 19, 2021. The cadastral value of the land is equal to 523,000 rubles. The local administration has established a tax rate for this plot of 0.9%. To calculate the tax required to be paid in 2021, it is necessary to calculate the tax base. It will be (taking into account the benefit of 10,000 rubles for a disabled person of the 1st group): 523,000 - 10,000 = 513,000 rubles. The plot was owned for 1 full month. The tax amount will be: 513000*0.9%/12*1 = 385 rubles.

Payment of land tax on the simplified tax system if the land has been owned for less than a year

As with any other types of taxes, the calculation and payment of land tax has its own characteristics. In particular, taxpayers often have questions in cases where the right to use a plot of land arose within a year. How to calculate tax in such situations?

It’s simple: the cadastral value of the plot must be taken on the date when the cadastral registration took place. At the same time, the amount of tax must be calculated taking into account a special coefficient, which you need to calculate yourself. To do this, you need to look at how many full months of the year the land plot was owned. Then the resulting number must be divided by 12 - the result will be the desired coefficient.

For clarity, let's give an example

bought a piece of land. At the same time, ownership of the land was registered on August 5, 2014. The land tax rate established at the local municipal level for this category of land is 1.5%. At the same time, the cadastral value of the plot is equal to one million rubles. We make calculations.

Since Svetoch LLC acquired land rights before August 15, then, according to the law, the period of ownership of the plot for tax purposes is counted from August 1, 2014.

The company calculates the amount of the advance payment for the third quarter of 2014 taking into account a special coefficient, the calculation scheme for which we described above. In this case, it is 2/3, since in the third quarter the land was owned by Svetoch LLC for only two months - August and September. Through further simple calculations, we find that the amount of the advance payment for the third quarter of 2014 will be:

1 million rub. × 1.5% × 1/4 × 2/3 = .2500 rubles In order to calculate the final amount of the annual land tax for 2014, the accountant of Svetoch LLC needs to again calculate the correction factor:

5/12 (5 months: 12 months) Next we calculate:

1 million rub. × 1.5% × 5/12 = 6250 rubles - the amount at the end of the year, but since Svetoch LLC already paid the advance payment for the third quarter, its amount must be subtracted from the total amount:

6250 rub. – 2500 rub. = 3750 rubles - this is exactly how much money this enterprise must pay to the state budget as land tax.