Land tax: calculation procedure in accounting and tax accounting

Application of PBU depending on the purpose of the site

Before reflecting the land tax paid to the budget on the basis of advance payments, the accountant needs to determine which accounting regulations to follow. This is not so easy to do, since it is necessary to clearly distinguish between the purpose and use of the land plot. This norm of clear delineation is determined by Federal Law No. 129 of November 21, 1996. It says that depending on where the land for which the tax is paid is used, the application of a particular PBU will depend.

But first, it is important to understand what type of asset is land? For experienced and novice accountants, the question is not difficult, land is always the main asset, therefore, it is necessary to apply PBU No. 6/01. Therefore, in any case, if an enterprise pays land tax, then it attributes these expenses to expenses associated with the operation and use of the fixed asset itself.

It is also important to know that the costs of paying land tax can be written off as expenses for the operation and use of OS only if no capital construction is carried out on this land plot. This is a very important and fundamental question. If the land is used for construction, then there will be completely different bills.

By the way, this is a very common mistake of practicing accountants. There is no distinction between fixed assets and capital construction regarding the use of land.

Thus, if a legal entity has land on which construction is not carried out, then in accordance with PBU 10/99 “Organization expenses”, land tax accounting in accounting will be reflected on:

Accounts of expenses related to the main activities of the enterprise;
Accounts that reflect other company expenses.

But if an enterprise is carrying out construction on a land plot at the time of paying the tax, then, according to the current PBU 6/01, it is obliged to take into account the advance payment in the capital costs of construction.

That is why, when owning several land plots, it is advisable to calculate the amount of advance payments separately, and then fill out the declaration with one total, except for section 2.

How does the purpose of a land plot affect postings?

And also, to understand which costs should be classified as costs for ordinary activities, and which – to other types of activities, you can use the criterion of materiality, systematicity of income generation for a certain activity or internal regulations of the organization, such as accounting policies.

Accounting for land tax in accounting

The procedure for paying taxes is established in the register “Procedure for paying taxes locally.” The register can be accessed in the “Directories” section of the main menu in the “Taxes” link group. A register entry is created indicating:

The actual cost of the item includes the purchase price, import duties and non-refundable purchase taxes, and any other direct costs of bringing the item into working condition. Any trade discounts are deducted from the actual cost. Administrative and management overhead costs are not included in the actual cost of an item unless it is proven that they are directly attributable to its acquisition and bringing it to working condition.

Fines and penalties Often, after a desk or field audit, tax authorities charge taxpayers with fines and penalties for taxes. Land tax is no exception. If the tax authorities have imposed fines and penalties, then the following entries should be made in the accounting records: Even if the company is going to defend the unlawfulness of the accrual of penalties and fines, then it is still necessary to make an entry for the accrual of these amounts. Important

Non-refundable tax

Organizations are a separate category of tax payers: the procedure and terms differ from individuals, which is confirmed by municipal laws. All nuances of paying advance payments for land tax are fully regulated by local authorities.

Land tax is paid by making advances at the end of each quarter and then at the end of the year, offsetting previously paid advance payments. Tax amounts are accepted as expenses equally in accounting and tax accounting on the date of accrual.

Account correspondence

Considering the procedure for calculating land tax, it should be noted that when calculating the tax, a special account 68 is used, which is called “Taxes”. It is not advisable to reflect a tax without opening sub-accounts for this account, therefore, for each tax, an accountant, as a rule, must open sub-accounts. The procedure for opening sub-accounts is reflected in the order on accounting policies, which regulates all company accounting.

Account 68 is passive, and therefore all tax accruals are reflected in the credit of the account, and the payment of tax is accompanied by the closure of the account in debit.

Regarding the corresponding accounts, it all depends on where the land is used: in the main production, auxiliary, etc. In this case, a variety of accounts can be used.

And then the most popular and frequently used accounting entries for land tax:

Land tax has been accrued (if the land is used in the main production and tax expenses will be attributed to the costs of the main activities)

Dt 20, 23, 25, 26, 29 or 44

Kt 68 with an open subaccount;

Land tax paid to the budget:

Dt 68 with an open subaccount

Kit 51

But, as mentioned earlier, land can relate not only to the main production, but also simply provide auxiliary activities. A striking example of this direction can be the case when land is leased. In this case, land tax expenses are charged to account 91 with subaccount 91.2.

The wiring will be similar:

Land tax accrued

D-t 91.2

Kt 68 with an open subaccount;

Land tax paid to the budget:

Dt 68 with an open subaccount

Kit 51

If land is considered as an element of capital construction, then all costs are accumulated in account 08. For each capital construction project, its own sub-account is opened. In this case, the wiring will be as follows:

Land tax accrued

D-t 08

Kt 68 with an open subaccount;

Land tax paid to the budget:

Dt 68 with an open subaccount

Kit 51

This is a complete list of options that may occur in practice.

Postings for land tax in accounting

If a legal entity is a land tax payer, then it needs to open a subaccount of the same name to accounting account 68, which must be reflected in the chart of accounts, which is approved by the head of the enterprise along with the accounting policy.

Which accounts at the enterprise are used to reflect costs for ordinary activities should also be described in the accounting policies of the legal entity. For trading enterprises this is account 44, for manufacturing companies it can be accounts 20, 23, 25, 26, 29. The accounting entries for land tax will depend on which account is used to reflect certain expenses.

For example, if the land is located under the trade pavilion of a store, then land tax will be charged by posting Dt 44 Kt 68. The same operation must be done for the land plot under the warehouse where goods are stored for sale.

For manufacturing enterprises, it will matter what premises are located on the land plot. It happens that the production workshop is located in one place, and the administrative building where the organization’s office is located is in another place. Then the land tax is registered with accounting entries, which will be different for each individual area. The debit account will be one of the following accounts:

20 – main production;
23 – auxiliary production;
25 – general production costs;
26 – general business costs;
29 – service farms and production.

And if, for example, a land plot is leased, but such activity is not normal for the organization, then the expenses for such a plot are included in other expenses, and land tax should be correctly calculated using the entry Dt 91.2 Kt 68.

But if the activity of leasing out own land is the main activity for the enterprise, then the tax accrual will be reflected in the debit of account 20 or 26.

If during capital construction the land tax, according to the requirements of PBU 6/01, should increase the cost of the object, then the posting will be as follows: Dt 08 Kt 68.

The requirements for maintaining simplified accounting do not differ from the requirements for maintaining accounting at enterprises with any other taxation system. Therefore, entries for land tax under the simplified tax system will be similar to those indicated above.

Payment of land tax is reflected in the debit of the corresponding subaccount 68 of account and the credit of account 51.

How land tax will be calculated depends on many factors. To correctly reflect data on such a tax, it is necessary to focus on the working chart of accounts of the legal entity, accounting policies and features of the use of the site.

The procedure for calculating and paying land tax

Regarding the procedure for paying and calculating land tax, this procedure is regulated by both the Tax Code and local regulations. The tax is not paid at the end of the reporting year, but only in advance on the basis of advance payments. The advance is paid quarterly and amounts to ¼ of the total annual tax amount.

The deadline for paying land tax may also differ in each individual region, but usually it is until the end of the next month that follows the quarter. You can read more about the deadlines for paying land taxes for 2021 here.

How to calculate land tax

You need to determine the tax base and multiply it by the tax rate. The tax base and amount are calculated separately for each plot of land. If the site is located on the territory of several municipalities, then it is necessary to separately determine the base for each part falling on each of the municipalities. If the plot is jointly owned by several persons, then it is necessary to separately determine the basis for each share owned by each person.

The tax base is the cadastral value of the plot (or its share) as of January 1. If the plot is formed in the middle of the year, then the tax base is the cadastral value as of the date of cadastral registration.

The Tax Code of the Russian Federation provides a list of categories of taxpayers for whom the base is reduced by a non-taxable amount. It is equal to the cadastral value of 600 sq. m. area of the site. The number of persons who are entitled to take advantage of this benefit includes, among others, veterans of the Great Patriotic War, heroes of the Soviet Union and the Russian Federation, disabled people and pensioners. Municipal authorities may adjust the list or change the amount of the deduction.

The base should be determined and the tax calculated based on the results of the tax period, which is equal to one calendar year. In the case where the right of ownership (perpetual use or lifelong inheritable gift) arose or ceased in the middle of the year, then the land tax must be calculated taking into account the coefficient. To find it, you need to take the number of full months during which the taxpayer owned the plot and divide it by the number of calendar months in the year.

If the right arose or terminated before the 15th day inclusive, then the month in which the rights arose is taken as a full month. If the right arose or terminated after the 15th day, then the month of termination of the rights is taken as a full month. The same algorithm should be applied in a situation where in the middle of the year the type of permitted use of the site changed, or the site was transferred from one category of land to another.

Let's explain with an example. Let's say an organization purchased a plot of land on February 25 and sold it on September 20. It turns out that the company owned the site for seven full months (March, April, May, June, July, August, September). This means the coefficient is 0.59 (7 months: 12 months).

Results

Normative base

During capital construction, costs are collected for each object on account 08 “Investments in non-current assets” under the sub-account “Construction of fixed assets” opened to it. In this case, when land tax is calculated, the posting will look like this:

the owner owned the plot for an incomplete tax period (that is, not 12 months);
the cadastral value changed during the year (the reasons why this is possible are indicated in the chapter Tax base and its definition);
the plot was reorganized (divided into several or combined with others), resulting in changes in the area of the taxable land plot;
the taxpayer has the right to benefits (tax deduction).

If capital construction is carried out on a site, then payment for land in the form of land tax should be taken into account in accounting as part of capital construction costs. This norm is reflected in PBU 6/01 (clause 8 and clause 14).

Subjects of taxation

Taxpayers, on the basis of Art. 388 of the Tax Code of the Russian Federation, legal entities and individuals are recognized - owners of a land plot, as well as owners and users of land plots, in whose possession or use this land plot is indefinitely.

The financial manager tracks the actual costs of purchasing inventories, which include: amounts paid to the seller under the supply agreement; remuneration of the intermediary organization involved in the process of acquiring inventories; payment for information and consulting services regarding the acquisition of inventories; customs duties; non-refundable taxes paid separately by the buyer in connection with the purchase of inventory; costs of their procurement and delivery to the place of use, including insurance costs; other costs directly related to the acquisition of inventories. The actual costs of acquiring inventories do not include: costs of refining and improving the technical characteristics of inventories not related to production; expenses not directly related to the acquisition of inventories. In cases where inventories are not purchased, but are manufactured by the enterprise, their actual cost is determined based on the actual production costs in the manner established for determining the cost of the relevant types of products.

Acquisition costs (transport and procurement costs) include the purchase yen, import duties and other non-refundable taxes, transport, forwarding, costs of intermediaries and consultants, and other costs directly attributable to the acquisition of goods, materials and services. Trade discounts, chargebacks and other similar amounts are deducted from these costs. For invoices issued in foreign currency, in the event of a major devaluation or decrease in the value of the currency arising in force majeure circumstances, it is allowed to include exchange rate differences in the acquisition costs if they affect the organization's outstanding obligations.