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Thread: Question about tax when selling an apartment

  1. #1
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    Question about tax when selling an apartment

    Can anyone clarify the situation regarding an foreigner selling an apartment in Russia?
    As i understand the situation, if the apartment has been held for 3 years then there is no tax to pay on any gain (differenced between buying and selling price)
    Does it matter that you are not resident in Russia?

    If anyone knows the rules, please share.
    Cheers

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    You're right about the 3 year rule( the buyer pays the tax if the flat is held for less than 3 years)...I can't see why there should be a difference if the property is owned by a non-resident.
    Do you have an agent?
    Give one of these a ring,like Knight Frank or Evans, they will have English speaking agents..Free info....You could ask them about being a non-resident...Better from the horse's mouth...
    Knight Frank
    International Real Estate (residential, office, industrial, retail, land) consultancy, valuation, strategic planning, research and investment services in Moscow since 1996.
    Address: Timura Frunze ul., 11, str. 2-5
    Metro: Park Kultury
    Tel: 981-0000
    Fax: 981-0011
    Web: www.knightfrank.ru

    Evans Property Services
    Tel: 232-6703 / 04
    E-mail: info@evans.ru
    Web: www.evans.ru

    http://expat.ru/wiki/Realty_Agencies
    Last edited by Judge; 27-03-2013 at 22:31.

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    Cheers Judge, will Skype them and report back.

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    Quote Originally Posted by Nobbynumbnuts View Post
    Can anyone clarify the situation regarding an foreigner selling an apartment in Russia?
    As i understand the situation, if the apartment has been held for 3 years then there is no tax to pay on any gain (differenced between buying and selling price)
    Does it matter that you are not resident in Russia?

    If anyone knows the rules, please share.
    Cheers
    When you sell an apartment, the price is your income.
    If you're a Russian resident and have owned the apartment for 3 years, you can use tax allowance in amount of 100% of selling price. Then you "pay" 13% from nothing, not because you don't have to pay taxes after 3 years of ownership, but because you can use the allowance.
    If you're not a Russian resident, your income is 100% of selling price and you can not use any allowances. So your tax base is your income, and tax rate is 30%.
    In case you contact KnightFrank or any other professionals, please share their reply here, if possible with names of documents they will refer to, i'm not a tax specialist and really curious what is the actual practice.
    Скушно жить, мой Евгений. Куда ни странствуй,
    всюду жестокость и тупость воскликнут: "Здравствуй!
    Вот и мы!"

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    Quote Originally Posted by MashaSashina View Post
    When you sell an apartment, the price is your income.
    If you're a Russian resident and have owned the apartment for 3 years, you can use tax allowance in amount of 100% of selling price. Then you "pay" 13% from nothing, not because you don't have to pay taxes after 3 years of ownership, but because you can use the allowance.
    If you're not a Russian resident, your income is 100% of selling price and you can not use any allowances. So your tax base is your income, and tax rate is 30%.
    In case you contact KnightFrank or any other professionals, please share their reply here, if possible with names of documents they will refer to, i'm not a tax specialist and really curious what is the actual practice.
    I looked through the Evan's website and it states that non residents are liable to 30% tax on the selling price. Period.
    http://www.evans.ru/taxes_realestate/#05
    I will call them and get a few more details but it looks like i need to do some creative bookkeeping somehow. If any one has any ideas, please PM me.

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    Can 183 days in Russia be an option for you?
    Скушно жить, мой Евгений. Куда ни странствуй,
    всюду жестокость и тупость воскликнут: "Здравствуй!
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    Quote Originally Posted by MashaSashina View Post
    Can 183 days in Russia be an option for you?
    It would be but i don't want to spend 183 in Russia. I live outside these days.

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    Quote Originally Posted by MashaSashina View Post
    When you sell an apartment, the price is your income.
    If you're a Russian resident and have owned the apartment for 3 years, you can use tax allowance in amount of 100% of selling price. Then you "pay" 13% from nothing, not because you don't have to pay taxes after 3 years of ownership, but because you can use the allowance.
    If you're not a Russian resident, your income is 100% of selling price and you can not use any allowances. So your tax base is your income, and tax rate is 30%.
    In case you contact KnightFrank or any other professionals, please share their reply here, if possible with names of documents they will refer to, i'm not a tax specialist and really curious what is the actual practice.
    I called Evans and had a very enlightening conversation with them.
    Apparently, the 30% tax has to be paid by non residents but the law doesn't state how. (if i understood them correctly)
    PM me if you want to know the details of the conversation.

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    30% tax for a non-resident (the calendar year when the property was sold is taken into account), regardless 3 yrs or not

    No tax if a resident and > 3 yrs (Simply no tax, before it was a 100% tax deduction, since 2011 as I remember - simply no tax. so you don't have to fulfil anything)

    I don't know your situation, but 30% of almost any Moscow property should be a good motivation to stay here 6 months.

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