With the adoption of Law No. 217 “On the conduct of gardening and vegetable gardening by citizens for their own needs...”, which regulates the activities of citizens in the management of gardening farms, summer residents are asking the question of what TSN is in gardening and how it differs from SNT. We are talking about the organizational and legal form (OLF) of an association of real estate owners. Previously, it was regulated by Law No. 66 on “On gardening, gardening and dacha non-profit associations of citizens,” which has become invalid. The new law No. 217 came into force on January 1, 2021. It implies a transition to a new form, indicating that reorganization and bringing the charter in accordance with new requirements are carried out upon the first change in the constituent documents of the partnership. This is a right, not an obligation, of the founders, i.e. changes may not be made. When choosing TSN or SNT, the pros and cons of both OPFs are carefully weighed, and only then the owners make a decision.
Homeowners' association and TSN - what is it, explanation
A homeowners' association or HOA is a non-profit association of individuals who own common property. Their goal is to manage this property, as well as conduct general business activities.
TSN is also an association of owners. Explanation of the abbreviation - partnership of real estate owners. Both individuals and legal entities who have any property (apartment, house, land, commercial real estate, etc.) can join TSN. The purpose of TSN is to exercise the powers of the owner in relation to single property within the framework provided by law.
The concept of “TSN” appeared relatively recently. It was introduced into legislation in 2014 and replaced the HOA. However, no adjustments have been made to housing legislation, so the HOA remains as a form of government.
TSN and HOA are non-profit organizations, membership of which is absolutely voluntary.
Peculiarities
A legal entity can also become a member of TSN. What kind of partnership is this supposed to be? This could be an office space management organization. Individuals can join several partnerships at once. For example, by place of residence, work and location of the dacha. Experts believe that owners of garden plots will be most pleased with the innovations. This is the most vulnerable part of the population. Previously, roads and communications were practically rented. Now the population has the opportunity to independently decide how to dispose of joint property.
What is the difference between TSN and HOA?
Unlike TSN, the HOA specifies the subject of management or improvement. This could be an apartment building or private residential buildings. Thus, the first difference is that only owners of residential buildings can be in the HOA, while owners of commercial real estate and land can also be in the HOA.
The second difference is in the composition of possible participants. Only private individuals and citizens can join the HOA. Organizations are allowed to join a real estate owners' association. Along with the composition of the participants, the list of their rights and obligations has also changed.
The purpose of creating non-profit organizations also differs. An HOA is created to resolve issues related to the improvement of adjacent territories and meet the important needs of residents (for example, carrying out the necessary communications).
A homeowners' association has slightly different goals. The main reason for creating such an organization is not the improvement and improvement of living conditions, but the management and disposal of common property. For example, renting it out, if necessary. Management is carried out, including the maintenance of property, its preservation and increase.
The activities of both non-profit organizations are carried out on the basis of the Charter and provide for the formation of a sole governing body. However, controlling and executive bodies are additionally introduced into the TSN, which is not done in the HOA.
Important decisions regarding the fate of real estate in TSN are made by individual members of the partnership. In HOAs, such decisions are made at a general meeting.
The taxation system for non-profit organizations is also different. Activities in HOAs can be conducted using a simplified tax system. For TSN, the transition to the simplified tax system is not possible.
Reorganization by transformation
Knowing the pros and cons of each OPF and taking into account the main differences between them, you can reorganize the current form by replacing SNT with TSN. It is standard in nature and includes several simple steps:
- Adoption of a decision at the general meeting to replace the current form of general public fund with a new one.
- Preparation and creation of an updated charter.
- Development of a package of documentation for office work.
- Collection and preparation of documents for public property of SNT, including IEP.
- Standardization and clarification of the list of participants.
If at the main meeting the majority of participants vote for changing the OPF, the head of the board will need to prepare and submit to the tax authorities:
- A statement certified by a notary in the established form.
- Minutes of the meeting of participants regarding a change in the type of organization.
- Charter of the new partnership in two copies.
- Receipt of payment of the fee for the procedure for changing the form.
- A document to confirm the new address of the partnership.
Property Owners Association: Pros and Cons
The following advantages of a real estate owners' association can be highlighted:
- When a citizen or legal entity cannot resolve any issue regarding the management and improvement of property, TSN will come to the rescue. This will save the owner time.
- Another advantage of TSN is the management of property by a certain circle of persons. Of course, if the management is carried out competently and professionally.
- TSN is focused on managing and increasing property. This means that owners who have entered into a partnership can count on the profit received from competent management of real estate to be used to improve the property and general needs.
- All economic activities of TSN are completely open. This is an undeniable advantage of the partnership - each member can trace, among other things, the flow of funds.
Disadvantages of a property owners' association:
- A significant drawback of TSN for many owners is that the opinion of the majority will not be taken into account when making serious decisions. However, even in the activities of HOAs, owners do not always have the right to influence the measures taken.
- Since TSN is a legal entity, the organization can declare itself bankrupt.
To create a TSN you need to obtain a license. Licensing of such activities is regulated by Art. 192 Housing Code of the Russian Federation.
Additional changes in legislation
In addition to the question of how one form of OPF differs from another and what is the difference between them, it is important to know who can dispose of the property of partnerships. According to Article 123.13 of the Civil Code of the Russian Federation, all public facilities must belong to TSN participants, since they represent shared ownership. In SNT, this property previously belonged to all participants of the partnership or to individual participants if it was purchased with funds received after targeted contributions were made.
The adoption of Federal Law No. 99 also influenced the method of alienation of a plot of land along with a share in general property. If a partnership participant sells the plot, after that he will not be able to dispose of part of the TSN property. This right will automatically pass to the person who buys the land and becomes its subsequent owner. Before the adoption of the law, a SNT participant could simultaneously conduct two transactions and transfer the rights to the plot to the buyer along with the transfer of rights to common property.
Advantages and disadvantages of HOAs
Advantages of a homeowners association:
- Homeowners are not always able to resolve issues regarding improvement and improvement of living conditions. It is much easier to contact the HOA. For example, cleaning the surrounding area is not always possible for the owner. But the HOA can take on this concern and enter into an agreement with any organization to clean up the area. Also, an HOA can resolve many conflict situations with neighbors without bringing the matter to trial.
- Each homeowner who has joined the HOA can influence decision making. The opinion of the majority of owners will be taken into account, for example, at a meeting to determine which management company to start cooperation with.
- The financial and economic activities of the HOA are open. This information can be obtained by any interested member of the partnership.
- An HOA can operate on the simplified tax system. This means that the tax burden will be small.
- An HOA is not difficult to create. The activities of HOAs are not subject to licensing.
Cons of HOA:
- A large number of membership fees, which ultimately add up to a “round” sum. However, despite this, the total amount is lower than usual utility bills for landscaping.
- A significant disadvantage of the HOA is the need for the minority to submit to a decision supported by the majority.
Homeowners' association, in essence, is an organizational form of TSN. However, based on the identified advantages and disadvantages, a decision can be made to join. A consultation with a professional lawyer will help you find out in more detail what the risks of joining a HOA or TSN are.
OFFICE PROCESS ->
5.10. Non-use by a member of the Partnership of real estate belonging to him or refusal to use common property is not grounds for releasing the homeowner in whole or in part from participating in the general costs of maintaining and repairing common property.
— The notice of a general meeting of members of the Partnership shall indicate information about the person on whose initiative the general meeting is convened, the place and time of the meeting, and the agenda of the general meeting. The general meeting of members of the Partnership does not have the right to bring up for discussion issues that were not included in the agenda.
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Which is better: TSN or HOA?
Federal Law No. 99 of May 5, 2014 amended the Civil Code of the Russian Federation, according to which the activities of HOAs are abolished. However, they do not have to re-register their organizational form in TSN. This applies only to newly created partnerships.
Despite the fact that re-registration of an HOA into a TSN is not necessary, many homeowners’ associations are engaged in obtaining a license and re-registering the organizational and legal form.
This transition is due to the fact that the majority of owners have neither the time nor the desire to participate in the activities of the partnership. They have no time to attend meetings or make any decisions. The owners believe that their task is one - to pay utility bills on time for services provided. Therefore, independent decision-making by TSN is only for the better.
Now there is a tendency to combine several houses into one HOA, and yesterday's HOAs are assigned new responsibilities regarding commercial real estate.
Registration nuances
The method of managing apartment buildings is chosen by the owners and can be changed at any time. TSN decisions apply to all premises in the apartment building. If the management of the property was carried out by a management organization, then the owners should first consider refusing the services of this company. The Charter is the only document of TSN.
The initiator of the meeting of apartment owners must inform all residents about the date of the meeting at least 10 days in advance by delivering notices against signature or sending them by registered mail.
Any decisions of the partnership are considered adopted if a quorum, that is, more than 50% of the owners, votes for them. If there is no quorum, then the initiator can call a second meeting and make a decision in absentia. Decisions made in this way must be communicated to all members of society. For this purpose, the initiator or his representatives visit all apartments and distribute written decisions to residents.
