Land tax for individual entrepreneurs using the simplified tax system: who pays + rates and benefits

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By law, individual entrepreneurs can rent or own their own land, which will serve as their main source of income. Provided that the land plot is personal property, the individual entrepreneur pays land tax. The corresponding fees are paid to local authorities. It is the local authorities who establish, verify and control the process of paying the fee.

The procedure is carried out strictly within the framework of the Tax Code of the Russian Federation. What this amount is can only be found out from the competent authorities responsible for the procedure and reporting of this issue in the area.

Land tax rates

Tax rate

cannot exceed
0.3%
of the cadastral value of the plots:

• located on agricultural lands or as part of agricultural use zones in populated areas and used for agricultural production;
• occupied by housing stock and utility infrastructure facilities and acquired for housing construction, except for plots used in business activities (the exception is valid from the tax period of 2021);
• purchased for personal farming, gardening, vegetable gardening. Starting from the 2021 tax period, the rate applies to plots of this group if they are not used in business activities;
• from the tax period of 2021 - general purpose land plots intended for citizens to carry out gardening and vegetable gardening or intended for the placement of other public property.

The tax rate for other areas should not exceed 1,5%

from the cadastral value.

Privileges

Some categories of persons liable to pay taxes are provided with preferential conditions. Regarding citizens, it is provided that the amount of quitrent is significantly reduced if there is a benefit. At that time, the availability of benefits for a legal entity implies complete exemption from the obligation in question.

In this case, before starting to study the nuances of paying taxes, entrepreneurs need to refer to the list of types of institutions that, based on the principle of providing benefits, are exempt from tax. An entrepreneur can find his organization in this list and will not need to calculate and pay rent.

The following are exempt from payment:

• organizations carrying out religious activities;
• institutions specializing in the execution of punishments;
• those companies on whose territory there is a road intended for general purposes;
• institutions where persons recognized as disabled participate (provided that they constitute more than 8/10 of the total number of members);
• organizations involved in folk arts and crafts;
• institutions engaged in the repair and construction of ships (distributed in areas designated for this type of activity);
• in the regions of the Far North.

Calculation formula

Note!

Since 2015, individuals, including entrepreneurs, no longer have to calculate land tax on their own. This responsibility is assigned to the Federal Tax Service. Payment is made according to the tax notice.

Land tax is calculated using the following formula:

Land tax = Kst x D x St x Kv

,

Kst

– cadastral value of the land plot (it can be found on the official website of Rosreestr or using a cadastral map).

D

– the size of the share in the right to a land plot.

St

– tax rate (you can find out the tax rate in your region on this page).

Kv

– coefficient of ownership of a land plot (applies only in case of ownership of a land plot for less than a full year).

Payment of land tax under the simplified tax system: who should pay

The law of the Russian Federation stipulates that all enterprises and organizations, as well as individual entrepreneurs who own land and use land for their activities, are required to pay land tax. In addition, the need to pay this tax arises if a legal entity or individual entrepreneur has the right to perpetual use of land or exercises the right to inherit a land plot. It should be noted that if land owned by individual entrepreneurs is not used for commercial purposes, but only for personal needs, then it is worth re-registering it in order to pay this tax in the general manner, like ordinary individuals.

Attention! If the land is leased, then the tenant does not have to pay land tax and the lessor under no circumstances has the right to try to shift this responsibility to him.

Important! Regardless of the object of taxation: income 6% or income minus expenses 15%, all simplified taxpayers are required to pay land tax if they own the land and use it in doing business.

Land tax benefits

Some payers may be able to take advantage of federal and local incentives. If the tax authority has information about the payer's right to a benefit, it will be taken into account when calculating the tax. But if the taxpayer noticed upon receiving the notification that the benefit was not taken into account, he needs to submit an application to the Federal Tax Service using the form from the order dated November 14, 2017 No. ММВ-7-21 / [email protected] The application is provided only once - then the benefit applies automatically.

Federal benefits

The indigenous peoples of the North, Siberia and the Far East, as well as their communities, do not pay land tax on plots that are used to preserve their traditional way of life.

When calculating the tax for certain categories of payers, the base is reduced by the cost of 6 acres of land area. The benefit is valid for disabled people of groups 1 and 2, Heroes of the USSR and the Russian Federation, WWII veterans, pensioners, parents of large families, and Chernobyl survivors. The full list of preferential categories is in paragraph 5 of Art. 391 Tax Code of the Russian Federation.

If there are several plots, the tax exemption benefit for 6 acres is valid only for one of them. The payer himself can choose which one. To do this, he needs to submit to any Federal Tax Service a notification about the elective land plot in the form approved by Order of the Federal Tax Service dated March 26, 2018 N MMV-7-21/ [email protected]

Local benefits

Representative bodies of municipalities may, by their acts, introduce additional benefits for certain categories of citizens. They allow you not only to reduce the amount of land tax required to pay, but also not to pay it at all.

To obtain information about established land tax benefits, you can use a special service on the tax service website.

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.

Calculation examples

Example 1. Calculation of land tax for a full calendar year

Object of taxation

Petrov I.A.
owns a plot of land in the Moscow region. The cadastral value of the plot is 2,400,385 rubles

.

Tax calculation

The tax rate for this land plot is provided in the amount 0,3%.

The land tax in this case will be equal to: 7,201 rubles.

(RUB 2,400,385 x 0.3/100).

Example 2. Calculation of land tax for an incomplete calendar year

Object of taxation

In October 2021 Petrov I.A.
registered the rights to a land plot located in the Moscow region. Its cadastral value is 2,400,385 rubles.

Tax calculation

The tax rate for this land plot is provided in the amount 0,3%

.

Land tax for three months of 2021 in this case will be equal to: 1,801 rubles.

(RUB 2,400,385 x 0.3 / 100 x 0.25),

Where, 0,25

– coefficient of time of land ownership (3 months / 12 months).

Example 3. Calculation of land tax for a share of land

Object of taxation

Petrov I.A.
owns ¾ of a land plot located in the Moscow region. Its cadastral value in 2021 is 2,400,385 rubles

.

Tax calculation

The tax rate for this land plot is provided in the amount 0,3%

.

The land tax in this case will be equal to: 5,401 rubles.

(RUB 2,400,385 x ¾ x 0.3 / 100).

Example 4. Calculation of land tax taking into account benefits

Object of taxation

Combat veteran Petrov I.A.
owns a plot of land in the Moscow region. The cadastral value of the plot in 2021 is 2,400,385 rubles

.

Tax calculation

The tax rate for this land plot is provided in the amount 0,3%

.

The land tax in this case will be equal to: 7,172 rubles.

((RUB 2,400,385 – RUB 10,000) x 0.3 / 100),

where, 10,000 rub.

– a benefit that is provided to Petrov I.A. due to the fact that he is a combat veteran.

What are the entries in budget accounting?

Every year, funds are allocated from budgets of all levels for the payment of land tax by budgetary organizations.

How to reflect the accrual and payment of land tax by budgetary organizations is indicated in the Instructions for Budget Accounting.

Depending on which taxation system the enterprise uses, accounting for accrual and payment of land tax will occur differently.

Land tax

According to the Instructions for Budget Accounting, land tax accounting in budgetary organizations depends on:

• use of land in budgetary activities

• and activities of the organization that generate income

When calculating land tax under the simplified tax system, the transactions are exactly the same as in other taxation systems.

Regardless of the taxation system, the entries for the calculation and payment of land tax to the budget of the subject of the federation will be as follows:

The calculation of land tax and its reflection on one of the cost accounts depends on the intended purpose of the site.

To account for land tax, subaccount 9 “Land tax” is opened in account 68 “Calculations for taxes and fees”.

Land tax must be calculated and paid from the moment of registration of land rights. After registration, the land plot is accepted on the balance sheet of the enterprise in account 01 “Fixed assets” under the subaccount “Land plot”.

A plot of land is accounted for at its original cost. To calculate the initial amount of land tax, the cadastral value of the plot at the time of registration of real rights to it is taken.

Depreciation is not charged on land, so the tax can be reduced only if the cadastral value decreases.

For tax accounting purposes, the amount of accrued land tax is credited to account 91 “Other income and expenses” to subaccount 2 “other expenses”.

Thus, if the land plot is not used for the main activity, then the entries for the calculation and payment of land tax will be as follows:

Advance payment calculation

The Tax Code of the Russian Federation states that all taxpayers must make advance payments for land tax.

But, if the authorities of the constituent entities of the federation have not established such an obligation at the legislative level of the subject, then taxpayers should not accrue and pay advance payments.

Budgetary organizations are taxpayers of land tax, and charge and pay land tax on a general basis.

Budgetary organizations must pay land tax and advance payments from their own funds that business activities bring them.

If they do not conduct such activities, then they need to write a letter to the territorial department of the Federal Tax Service to grant them a deferment in paying this tax.

The calculation and payment of advance payments occurs in the same way as the main tax. The accounting entries are made exactly the same.

How to calculate the amount for paying land tax, read the article: calculation of land tax.

What benefits are provided to combat veterans?

For tax purposes, advance payments are taken into account in the same way as annual taxes. Such records are kept if the land plot is used for the main activity.

The basis for the calculation and payment of the advance payment, as well as the main tax, is an accounting certificate.

All accrued and paid advance payments are included in other expenses from ordinary or operating activities.

The management of the company decides how to account for advance payments. This decision must be reflected in the company's accounting policies.

The company chooses the list of indirect and direct expenses independently. They independently determine which expenses include land tax.

Such records are kept if the site is not used for the main activity.

Fine and penalty

Often, after a desk or field audit, tax authorities impose fines and penalties on taxes on taxpayers. Land tax is no exception.

If tax authorities have imposed fines and penalties, then the following entries should be made in accounting:

Even if the company is going to defend the illegality of accruing penalties and fines, it is still necessary to make an entry for the accrual of these amounts.

In 1C, transactions for calculating land tax are generated automatically.

If the company wins the case, and the accrual of fines and penalties is declared unlawful by the court, then based on the court decision, a “reversal” entry will be made.

All tax sanctions, including land tax, are not taken into account in tax accounting.

That is, when calculating the tax base for income tax, penalties are not included in the expenses that reduce this base.

The same applies to “simplified” people who use “income minus expenses”. Sanctions do not reduce the tax base for the single tax on the simplified tax system. The same state of affairs is with the “imputed” people.

Tax notice

For individuals, the land tax is calculated by the tax service, after which it sends a notification to their place of residence, which contains information about the amount of the tax, the deadline for its payment, etc.

Tax notices in 2021 for 2021 will be sent to residents of Russia between April and September

.

If erroneous data

In the notification, you must write an application to the tax service (the application form is sent along with the notification). After confirming this data, the tax amount will be recalculated and a new notification will be sent to the taxpayer.

The tax notice did not arrive

Many land owners mistakenly believe that if they have not received a notice from the tax service, then they do not need to pay land tax. This is wrong

.

On January 1, 2015, a law came into force according to which taxpayers, in the event of non-receipt of tax notices, are required to independently report

to the tax authority about the availability of real estate assets, as well as vehicles.

The above message, with copies of title documents attached, must be submitted to the Federal Tax Service in respect of each taxable object once before December 31 of the following year. For example, if the land was purchased in 2020, and no notifications were received regarding it, then information must be provided to the Federal Tax Service by December 31, 2021.

Therefore, if you do not receive a notification, the Federal Tax Service recommends taking the initiative and contacting the inspectorate in person (you can use this service to make an appointment online).

If a citizen independently reports the presence of a land plot on which tax has not been assessed, the payment will be calculated for the year in which the specified message was submitted. However, this condition only applies if the tax office did not have information about the reported object. If the payment notice was not sent for other reasons (for example, the taxpayer’s address was incorrectly indicated or it was lost in the mail), then the calculation will be made for all three years.

For failure to submit such a message within the prescribed period, the citizen will be held accountable under clause 3 of Art. 129.1 of the Tax Code of the Russian Federation and was fined in the amount of 20% of the unpaid tax amount for the object for which he did not submit a report.

Accounting for land plots under “simplified”

O.E.
Shpilevaya, D.V. Ignatiev, experts from the Legal Consulting Service GARANT The organization applies the simplified tax system with the object of taxation “income minus expenses”. The organization has several land plots on its balance sheet at purchase price; the acquired land plots are not intended for further resale. Land plots are not depreciated. How to write off the cost of land in accounting?

According to paragraph 3 of Article 4 of the Federal Law of November 21, 1996 No. 129-FZ “On Accounting”, organizations that have switched to the simplified tax system are exempt from the obligation to maintain accounting records, except for accounting for fixed assets and intangible assets.

This means that an organization using the simplified tax system must keep records of fixed assets in accordance with PBU 6/01 “Accounting for fixed assets” (hereinafter referred to as PBU 6/01).

Land plots for accounting purposes are accounted for as part of fixed assets (clauses 4, 5 of PBU 6/01).

Fixed assets are accepted for accounting at their original cost (clause 7 of PBU 6/01). The initial cost of fixed assets acquired for a fee is recognized as the amount of the organization's actual costs for acquisition, construction and production, with the exception of VAT and other refundable taxes (except for cases provided for by the legislation of the Russian Federation) (clause 8 of PBU 6/01).

As a general rule, the cost of fixed assets is repaid through depreciation (clause 17 of PBU 6/01).

At the same time, fixed assets whose consumer properties do not change over time, including land plots, are not subject to depreciation (clause

Deadline for payment of land tax

In 2021, a single deadline for citizens to pay property taxes has been established for all regions of Russia - no later than December 1, 2021

(for 2021 tax payment).

note

that in case of violation of the deadlines for payment of land tax, a penalty will be charged on the amount of arrears for each calendar day of delay in the amount of one three hundredth of the current refinancing rate of the Central Bank of the Russian Federation. In addition, the tax authority may send a notice to the debtor’s employer to collect the debt at the expense of wages, and also impose a restriction on leaving the Russian Federation. There is no fine imposed on individuals for non-payment of taxes.

Land tax under the simplified tax system: income minus expenses

The list of expenses accepted for simplified taxation is reflected in Art. 346.16 Tax Code of the Russian Federation. Subp. 22 clause 1 of this article indicates the right to reduce the tax base by the amount of accrued and paid taxes, including land tax.

In Art. 346.17 of the Tax Code of the Russian Federation, namely in paragraph 2, describes the procedure for recognizing expenses - expenses are accepted for tax accounting after their actual payment.

This means that it is possible to reduce the tax base for land tax for the 1st quarter of 2021 only when calculating the single tax for the 2nd quarter of 2021, since land tax is paid at the end of the quarter.

For entrepreneurs, the deadline comes much later - December 1. Therefore, those individual entrepreneurs who wait until the deadline for paying land tax will be able to reduce the taxable base for it under the single tax under the simplified tax system only for the next year.