Taxation of nonresidential property was introduced in Ukraine from Jan. 1, 2015 with local authorities now empowered to set the rate.
This is stipulated in the law on amendments to the Tax Code of Ukraine and certain Ukrainian laws on tax reform, which was posted on the website of the state’s official publication Holos Ukrainy.
The tax rate for one square meter of gross space of residential and nonresidential property for individuals and companies is set in the amount not exceeding 2% of the annual minimum wage, around UAH 24.36 (the minimum wage as of January 1, 2015 is Hr 1,218 a month).
The law foresees benefits for individuals who pay the property tax. The tax will not apply to apartments smaller than 60 square meters and houses smaller than 120 square meters. If the taxpayer owns two various types of residential facilities – the taxation base is set at over 180 square meters.
If taxpayers own more than one residential property of one type, the tax is accrued, taking into account the gross space of property, and is cut by 60 square meters for apartments and 120 square meters for houses.
If taxpayers have more than one residential property of any type the taxable space is cut by 180 square meters.
Local councils can increase the upper limit for residential property by which the taxation base is cut, and set property tax benefits for individuals depending on their income.
Property tax benefits for individuals will not be awarded if the gross space of property is five times more than the non-taxable space approved by local authorities and if the taxable property is used for profit.
Taxes do not apply to orphanages, including family orphanages, dormitories, residential property unfit for dwelling, including those properties that are unfit due to an emergency, and property belonged to orphans, children without parental custody, children with disabilities raised by single mothers or fathers, but to no more than one property per child.
The tax does not apply to nonresidential property used by small and medium-sized businesses operating in kiosks and in markets, industrial buildings, agricultural facilities meant used for both agricultural and residential purposes, and nonresidential property owned by nongovernmental organizations for people with disabilities and their enterprises.
