Are there restrictions on property ownership?
To answer the question of how many apartments one person can own individually, it is necessary to refer to the Civil Code of the Russian Federation.
The Civil Code of the Russian Federation regulates property relations between individuals and legal entities, and this problem is also covered there. So, Article 213 of the Civil Code of the Russian Federation, which specifies the rights of ownership of property by individuals and legal entities, states the following:
- the amount of property that citizens and legal entities can own is unlimited;
- the value of the property also has no restrictions.
Exceptions are spelled out in Article 1, Paragraph 2 of the Civil Code of the Russian Federation, and they relate to violations of the rights and interests of other legal property owners.
Thus, we can unequivocally answer the question posed: yes, one person can own several apartments on a property basis.
In order to find out what property is owned by a person, you need to contact Rosreestr for an extract. All information about registered immovable properties is contained there. This information is confidential and cannot be provided to any person upon request. To request an extract from the Unified State Register, you must have good reason. They can do this:
- the owner himself;
- his confidant;
- presumptive heirs;
- representatives of government agencies.
To obtain a certificate, you will need to pay a state fee. The certificate is valid for 30 days.
Taxes
If you own real estate, you need to pay taxes on it. What tax obligations are associated with both the first and second apartments owned by the owner? Is there a difference in the amounts in the first and second cases? What tax is paid? The short answer is that in the most general case there is no such difference, but there are certain situations where quantity matters. This is due to the mechanism for providing tax benefits.
What does this mean? If the second apartment is purchased through a purchase and sale agreement, then this transaction is necessarily subject to the appropriate tax. We are talking about paying income tax. It is important to note that it is not the buyer who pays it, but the seller. The buyer in this situation does not pay taxes. Moreover, the state partially compensates for the costs of purchasing a home by providing a tax deduction.
As for the payment of tax payments for real estate already owned, they are paid every year in the amount determined by law.
Features of privatization
Despite the fact that each citizen can own several real estate properties, he can only privatize one. Thus, if one of the apartments was privatized, then it is impossible to do this process with the second apartment. But if the first housing was received as a result of a purchase and sale transaction, by inheritance or as a result of a gift, then the second living space can be privatized.
However, there are exceptions to this rule, which are set out in the Law of the Russian Federation “On the privatization of housing stock” No. 1541-1.
If the property was privatized by a person who was under the age of majority at the time of the procedure, then after he reaches 18 years of age, he can privatize another living space. Thus, he will become the owner of two privatized apartments.
Basic Concepts
But most often there are unallocated shares.
The procedure for using rooms in an apartment consisting of such shares will not be determined. And the owners of such shares will experience constant inconvenience associated with the division of territory inside the apartment.
Some co-owners will believe that their neighbors (neighbors in an apartment in shared ownership are called “ Co-Shareholders”
") they put their closet in the wrong place.
And other sharecroppers may be against arranging dishes in the kitchen. Considering that they should have a place at the sink, and not at the window.
Sometimes even the Court cannot determine the procedure for using shares in an apartment.
This happens if the shareholders are members of different families and their number exceeds the number of isolated rooms in the apartment.
Or when the rooms in the apartment are adjacent. In this case, the order of use is simply impossible to determine.
This is why scandals occur between co-owners of such housing.
They cannot independently agree on who will occupy what room, and the Court is also unable to help them.
In this case, the easiest way out would be to sell the apartment that is in shared ownership.
And divide the money between all shareholders. Into parts corresponding to the size of their shares in the apartment.
Apartments in new buildings
One of the options for owning several apartments is to buy real estate in new buildings. Indeed, buying a home at the initial stages of construction, when a high-rise building is just under construction or a foundation pit has just been dug, is much more profitable than buying a house that has already been built.
For these reasons, many citizens buy several properties at once at the excavation stage, hoping to sell them when the house is built and prices per square meter increase. Is it as profitable as it seems? When making such transactions, several nuances must be taken into account.
When selling real estate, the tax established by the Tax Code is charged. Owners who have owned the property for several years are exempt from it, and this period depends on when they purchased the property:
- until January 1, 2021 - 3 years;
- after January 1, 2021 - 5 years.
Thus, if several apartments were purchased in new buildings in the last couple of years, then you will have to wait at least 5 years to sell them without paying income tax. A period of three years remains for objects that were obtained as a result of:
- gift agreements;
- inheritance;
- privatization;
- lifelong dependency agreements.
As for the first two points - inheritance and donation - this transaction should be made only between close relatives, which include parents, children, grandparents, grandchildren, brothers and sisters. For objects received from distant relatives or strangers, a period of five years is maintained.
You can check the ownership period of an object using two parameters:
- by the date of registration of ownership rights if the apartment was purchased;
- from the moment the inheritance is opened, that is, the death of a relative.
How apartment raiding began and how it was defeated
Since the early 2000s, expensive apartments. Shared property of hostile spouses.
They became easy prey for enterprising citizens who began buying shares in such apartments en masse. And resolve the issue of their resettlement with the spouse who remained in the apartment.
In all major cities of Russia, enterprising citizens began to unite in small groups consisting of:
- Our own lawyers who searched for profitable options for purchase and checked the title documents for the purchased property;
- Professional neighbors who were moved into the apartment for visibility. To create inconvenience for the sharecroppers living there.
- The organizers of this simple business, who acted as investors and gave money to buy out the disputed shares in the apartments.
- Real estate lawyers who defended the interests of this group in the Court.
- And persons involved in force support, which could be required if necessary.
People suffering from the activities of apartment raiders began to panic and knock on all doors and contact law enforcement agencies.
But they just shrugged it off and recommended going to court. Since the situation looked like a domestic quarrel between neighbors living in the same territory.
No criminal cases were initiated, and district inspectors dismissed the case for lack of evidence of a crime.
But everything changed when Russian TV channels began to cover this problem. Who conducted their own investigations and filmed full-fledged programs about it.
Then this problem began to be actively discussed on the popular video hosting site YouTube, and the upper echelons of power became involved in solving it.
By forcing local structures to act and giving them all the powers necessary for this.
It was impossible to remain silent any longer and it was necessary to act.
The situation with share-share businesses has so quickly overwhelmed all major cities of Russia.
That the law enforcement agencies decided to create special departments dealing only with apartment raiders.
Immediately, work began to boil in all Courts in the field of exposing the new evil.
And the mechanism of Article 179 of the Criminal Code of the Russian Federation, almost forgotten until that time, began to work (Forcing to complete a transaction or to refuse to complete it).
This is why numerous small groups of apartment raiders were brought in.
Finally, business based on the shares of enterprising citizens began to collapse everywhere, like a house of cards.
And thanks to the united actions of the police officers, evil was once again defeated.
Tax features
We found out that people selling an apartment that was received less than 3 or 5 years ago will have to pay income tax. However, these are not all the tax features that are associated with the second or subsequent real estate.
The tax deduction can only be received once. Thus, if the owner has already taken advantage of this benefit when purchasing the first apartment, then he will not be able to receive a deduction when purchasing the second or subsequent apartment.
Our legislation requires the payment of property taxes. Consequently, if a person owns several real estate properties, he is obliged to pay tax for each of them. Annual contributions do not change depending on how much property a citizen has, whether it is the first object or the second. They are calculated the same way and depend on the cost of the apartment according to the cadastre.
Preferential categories of citizens, which include pensioners, citizens with disabilities, veterans, etc., do not pay property tax. However, after the legislative reform, pensioners who own several apartments are exempt from paying tax for only one of them. This reform helps prevent fraudulent activities on the part of unscrupulous citizens who register apartments in the name of their elderly relatives in order to evade paying taxes.
How to determine the order of use in shared ownership
The procedure for determining the order of use is as follows:
The co-owners can determine the order of living in the apartment by oral or written agreement among themselves on a voluntary basis.
Even if the co-owners are not members of the same family, good human relations have not been canceled.
And you can always reach an agreement through negotiations without any negativity. It's all simple. Someone occupies one room, and someone else.
Or, during a divorce, the former spouses divide the apartment in half, and each of them becomes the owner of ½ share in the apartment.
But if there is a child and he stays with his mother, then the court usually decides to give them most of the apartment.
And the distribution occurs in the following proportions: the former spouse will receive 1/3 of the apartment, and the former spouse and child will also receive 1/3 each. Which in total is 2/3 of the apartment or most of it.
In this case, if the apartment is two-room, then the ex-wife and child will occupy a large room with a balcony, and the spouse will occupy an isolated small room.
If a three-room apartment is divided, then the former spouse will get a large room with a balcony, and the wife and child will get the remaining two smaller rooms.
The kitchen, hallway and bathroom will remain in shared use.
After all, by dividing an apartment into shares, people receive the same communal apartment that residents of big cities tried to get rid of in the late nineties and early 2000s.
At that time, communal apartments located in the very center of any large city.
They were actively bought by the “new Russians”. And their residents received a full-fledged apartment in exchange for their little room, but on the outskirts of the city.
This suited everyone. Because residents of communal apartments could not even dream of such happiness in the form of a separate, isolated living space.
Therefore, they literally accepted the apartment that literally fell on their heads in a residential area of the city as a gift of fate. And they literally thanked the “new Russian” businessmen as their saviors.
But the most interesting thing will happen when the Court divides a one-room apartment between members of the same family with a child.
The court will most likely side with the parent remaining with the child.
And he will simply deny the ex-spouse the right to use the residential premises. Leaving him as the owner, but without the right to live in the apartment.
In fact, the ex-husband will remain living on the street. And it’s absolutely legal.
And most likely, when his personal savings, spent on rent, run out.
He will be forced to put his share in the apartment up for sale. Having lost significantly in its real price. Since the one who first sells his share loses the most.
After all, it is on this that those people who buy shares in apartments make money.
But having no money to support the ex-spouses, they easily take such a step, understanding. That their actions will cause a number of troubles. Both to my ex-wife and to my child.
After all, strangers who bought a share in the apartment. They may treat the seller's former family members differently. And this current situation can have a completely different outcome.
But the fact is that they will try to infringe on the seller’s former family members in their rights and persuade them to either sell their part of the apartment to new owners. Or to a joint sale and division of the proceeds according to the size of the shares.
This is a fact that is obvious from the very beginning.
After all, then why buy a share in such an apartment at all? Where it is known that people already live.
What factors does the tax office take into account when qualifying income from the sale of real estate?
According to the Federal Tax Service of Russia, exactly how to qualify income from the sale of real estate depends on a combination of factors:
The following facts can indicate whether entrepreneurial activity exists or not:
You must be prepared for the fact that the inspectorate may become interested in the circumstances of your transactions and ask for clarification. The decision of the Federal Tax Service will depend on what arguments and evidence you provide in the explanatory note whether to classify your activity as entrepreneurial or not.
minimalism in the country house photo
Signs of entrepreneurial activity
Entrepreneurial activity is understood as an activity that meets three criteria:
In your case, the most important and controversial criterion is systematicity: whether three transactions for the sale of apartments in 2021 fall under it. If we were talking about 1-2 apartments, then this can hardly be considered a systematic activity. But when there are more transactions, questions arise.
There are no clear criteria for systematicity in the law - this is a subjective factor. This criterion does not exist in judicial practice either. I couldn't find any solutions that involved three real estate transactions. Typically, courts consider cases with a large number of transactions.
For example, in 2021 in the Chelyabinsk region, a man sold an apartment and ceded the rights to claim five apartments. He purchased all these apartments in 2017-2018. The Federal Tax Service decided that he was engaged in entrepreneurial activities and did not have the right to take into account the costs of purchasing apartments.
The man argued that the apartment was used for personal purposes, and the rest of the property was not his property at all, since at the time of the alienation the apartment had not yet been built. The inspectorate did not agree with him.
The man appealed the decision of the Federal Tax Service in court, but the court took the side of the tax authorities and noted that the transactions were systematic in nature, and their goal was to generate income. The apartments were owned for a short period of time; the man bought them from one company, which indicates a stable relationship with the seller. In addition, the housing was not intended for personal or family use.
Since the man was engaged in entrepreneurial activity, but was not registered as an entrepreneur, he does not have the right to take into account the costs of purchasing apartments when calculating personal income tax. According to the court decision, the man was obliged to pay arrears of personal income tax, penalties and a fine.
Even if there were not five transactions, but only three in a year, it cannot be said that there are no tax risks. It is possible that cases with so many transactions were simply not included in the sample. Or taxpayers did not take the matter to court, but paid additional taxes and fines voluntarily.
The Constitutional Court clarified that the rule on entrepreneurial activity is of a general nature. And whether one or another activity of an individual can be considered entrepreneurial depends on the actual circumstances of a particular case and is decided by the Federal Tax Service on the spot.
That is, in each situation, the inspectorate takes into account the circumstances and, based on them, makes a decision whether the activity can be considered entrepreneurial or not. Depending on the circumstances, the Federal Tax Service may not consider even five transactions in a year to be entrepreneurial activity, but classify three as such.
For example, a man had five apartments in the region: he inherited two, the third apartment was built for his mother, who lived in a poor area, in the fourth the man lived with his family, and he built another apartment for his son.
The son graduated from school and entered a Moscow university. To be close to their son, the whole family moved to the capital. The head of the family had to sell all five apartments, and the proceeds were barely enough to buy one in the capital. Moscow apartment prices are very different from the cost of housing in the regions.
If you explain all these circumstances to the Federal Tax Service and provide evidence, then troubles with taxes can be avoided.
Privileges
When they talk about the area that is not taken into account when calculating the tax, they mean the following. When determining the apartment tax, 20 square meters are excluded from the calculation. If a home has more than one owner, then 20 meters of area is excluded for each of them. For example, if the apartment has 4 owners, and the total area is 85 square meters, then you will only need to pay for 5 meters, the remaining 80 meters will be excluded from the calculation. If the tax is calculated for 2 or 3 apartments, benefits per square meters are calculated in the same way and are taken into account in each of the existing apartments separately. If the property has just one or several rooms, then only 10 square meters per owner are excluded from the calculation.
There are also those who are completely exempt from such payment. Their list is determined by law.
In particular, this list includes the following categories of the population.
This list is incomplete. The law provides not only for these, but also for some other categories of citizens.
For the rest you will need to pay on a general basis. In this case, the owner has the right to determine for himself what kind of property should be discussed and write a corresponding application to the territorial tax office. If this is not done, the apartment will be selected without his participation. Usually the one with which, according to the calculation, the highest tax is due, is selected.
Source
What taxes do you need to pay if you sell several apartments in a year?
By coincidence, I had three real estate sales transactions in 2021. I had to sell two apartments on assignment at the beginning of the year in order to cover the debts on the mortgage, which I did not pay. And in November, I decided to exchange my one-room apartment for a large two-room apartment in a new building in a neighboring building, where I now live. In addition to this, I also have a two-room apartment - also for living.
I recently watched a video of a lawyer and got worried. He says that the tax office now considers cases with three or more transactions per year as entrepreneurial activity.
I didn't sell real estate in 2021. And in 2021 there was one assignment for which I paid 130,000 R in personal income tax. During these years, I bought apartments under the DDU.
The current legislation does not have criteria for how many apartments need to be sold in order for it to be considered a business activity. But what is important is not the number of transactions, but the actual circumstances: how you bought the property and then sold it. And whether the inspection will regard your activity as entrepreneurial will depend on your explanations: why do you need so many apartments and why did you sell them after a short period of time.
If you can prove and confirm with documents that you bought apartments for yourself or relatives, and had to sell them due to unforeseen financial problems, you may be able to avoid additional tax charges and penalties.
