Receipt for inseparable improvements: risks
In general, the receipt serves as a loan agreement or records the fulfillment of financial obligations under a contract or alimony. According to the agreement, everything is more or less clear. But in our practice, we often encounter a situation where the actual value of real estate under a purchase and sale agreement is distorted, and the seller writes a receipt for the difference.
So, IF THERE IS NO SEPARATE AGREEMENT under which the money was received (in particular, receipts for inseparable improvements), such a receipt will be a promissory note . It states that one party (borrower) takes a specific amount from the other party (lender or creditor) under specific conditions, undertakes to repay within a certain period or before a specific date, or not to repay if a number of conditions are met. If the repayment period is not specified (and it is not indicated in the receipts for the “additional payment” for the apartment), then the amount must be returned by the borrower within 30 days from the date the lender submits a request for this. In the case where the receipt is considered as a loan agreement, we are talking about a promissory note. This is the most common purpose of this document.
That is why, if you are selling or buying real estate “with permanent improvements,” enter into a separate contract for the purchase of these improvements.
You can order such an agreement here>> or draw it up yourself.
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For reference! The peculiarity of this type of loan agreement is that it is drawn up in one copy, which is kept by the lender. When repaying a debt or fulfilling an obligation, the document is handed over to the borrower.
What it is?
Let's consider what the concept of inseparable improvements means when drawing up an agreement for the purchase and sale of an apartment. Inseparable improvements are improved living conditions created by the previous owner:
- the presence of built-in household appliances in the apartment at the time of sale;
- replacement of old furniture, heating systems, building materials;
- as well as redevelopment and reconstruction of rooms.
And they are called inseparable because the former owner cannot separate them from the real estate. This is the basis for rising prices for secondary housing.
It is worth noting that the Civil Code does not contain the concept of “inseparable improvements”. It was invented by sellers to reduce the amount of tax on the sale of real estate, the value of which has increased due to renovations.
Despite this, the contract is legal. If the home has been remodeled, this must be indicated in the technical documentation, otherwise it will be considered illegal.
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Recommendations and requirements for drawing up
Incorrect drafting of a document leads to legal consequences. That is, in order to be able to make demands on the debtor using a receipt, it must be properly drawn up.
Basic requirements for this document:
- A clear inscription “receipt” located in the middle of the sheet;
- Below on the left side, the locality where it is drawn up or where the place of fulfillment of the obligation is located is indicated (in 90% of cases we observe that sellers simply do not write the place of preparation);
- The line below or opposite the place of preparation, on the right side, indicates the date of preparation of the document - day, month and year;
- Next, the details of the parties and their roles are written down - who transfers money to whom;
- Last name, first name and patronymic (full name) are entered in full, without abbreviations - for example, Petr Vladimirovich Ivanov;
- After the full name, passport data is recorded (series, identification document number, by whom and when it was issued), date, month and year of birth, place of permanent (and temporary) registration;
- Amount of cash loan - the digital designation is duplicated in words;
- The currency in which the loan is provided, other features of the transaction;
- The term for providing money or the date by which the borrower agrees to repay it. And also, if applicable, the conditions under which the amount is not refunded;
- What are the funds transferred for, under what agreement or obligation (if applicable);
- After the text of the receipt, the full name and signature of the person who wrote it is placed. If desired, the lender (in real estate transactions - the buyer) can certify the receipt with his signature.
The presence of witnesses is not the main argument in a lawsuit if the dispute is regarding the conditions specified in the receipt. But they can confirm the very fact of writing such a document, the state of the parties at that moment. In this case, their presence is indicated in the text of the receipt, and the witnesses also sign the document.
For reference! If it can be proven that the receipt was drawn up and signed under physical and/or psychological pressure, it will be considered void.
The procedure for performing work and receiving compensation
There is no mandatory procedure for manipulating housing. Our portal recommends that the tenant adhere to the following option:
- Determine the scope of work, draw up preliminary settlement documents and estimates.
- Agree in writing with the owner of the apartment about the upcoming repairs. This must be done not just with a formal notification, but with the help of a full-fledged additional agreement, which specifically indicates what work will be performed, how much it will cost and how compensation will be paid.
- Carry out the work, accept it from the contractor, collect all checks and receipts and transfer copies to the landlord for reimbursement.
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Note! If the homeowner refuses to compensate for inseparable improvements, they can be recovered in court.
Dependence of legal force on format
So, there is no requirement under Russian law that a receipt be drawn up by hand or using office equipment. However, lawyers recommend writing it by hand.
The handwritten version compiled by the debtor confirms the following:
- He was aware of the obligations he was taking on;
- There was time to think and make a decision (at least during the discussion and writing of the document);
- Was not under the influence of any substances or in a state of emotional distress.
The latter is established during a handwriting examination and is additionally confirmed by witnesses. But if the receipt is printed and the debtor only signs, then the validity of his intentions may be questionable. And often the courts are inclined to side with debtors who manage to prove that they were misled, they did not realize the essence of what was happening, and the signature was put on a different occasion.
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Notary
The law does not oblige you to take a receipt to a notary or draw up a document in his presence. But, as in previous cases,
a notarized receipt indicates the intent of the parties. Courts accept such agreements as evidence without any reservations.
In addition, the Buyer himself is interested in drawing up a receipt from a notary. The latter will verify the Seller’s identity and check his legal capacity and mental state.
In this case, the document can also be compiled in printed form. Notarization eliminates many doubts; in order to recognize such a document as void, compelling reasons and documentary evidence are needed. If they are, even a simple handwritten version will not help.
Contract options
At the time of concluding a real estate lease agreement, a condition on inseparable improvements must be included in its text - no separate agreement is required for this. It is also not necessary to have it certified by a notary. There are several options for wording the terms in the contract.
Example 1. The parties agreed to make improvements with the consent and expense of the apartment owner
The essence of the condition. Inseparable improvements must be previously agreed upon with the owner of the apartment, who pays for the work or compensates for it when the residents move out.
Example of wording. “ The Tenant has the right, with the written consent of the Lessor, to make inseparable improvements to the leased property. In this case, the Lessor is obliged to reimburse the Lessee for the cost of such improvements."
Adviсe . We recommend including an approval procedure in the text of the contract - for example, by means of a simple notification or by drawing up a special agreement. Additionally, it is necessary to establish a compensation period within which the apartment owner must transfer compensation. An example of the wording of this condition in a lease agreement: “The implementation of inseparable improvements is agreed upon by the parties by concluding an additional agreement to this Agreement, which specifies the essence of the work, the timing of its implementation, the result and procedure for accepting the work, the cost of the Tenant’s expenses, the terms and procedure for reimbursement of the cost of inseparable improvements by the Lessor "
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Example 2. The parties agreed to make improvements with the consent of the apartment owner, but at the expense of the tenant
The essence of the condition. Inseparable improvements to the rented property must be previously agreed upon with the owner of the apartment, but the cost of the work falls entirely on the shoulders of the residents - the owner of the apartment does not compensate for them in any way.
Example of wording. “The Tenant has the right, with the written consent of the Lessor, to make inseparable improvements to the leased property. However, the cost of such improvements will not be compensated by the Lessor.”
Adviсe . If such a condition appears in the contract, the tenant will not be able to compensate for the improvements made, even if he spent a significant amount on them. You need to think carefully in advance whether such a condition is beneficial to the tenants - after all, the lease agreement will end, and the result will remain in the apartment. It will actually be used either by the owner himself or by new residents.
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Example 3. The parties agreed to make any improvements without the consent of the apartment owner
Terms of the agreement that allow the tenant to carry out permanent improvements without the knowledge and consent of the owner of the apartment are illegal. Even if they are included in the text of the contract, they cannot be applied in practice; they are void within the meaning of civil law.
If the tenant, for example, reconstructs the premises without the consent of the owner, he will not be able to recover compensation from him even if there is a corresponding provision in the contract. Moreover, the owner will oblige the tenant through the court to restore the apartment to its original condition.
Example 4. The issue of improvements is not regulated by the contract
If the agreement does not contain any reference to integral improvements at all, then the rules of law apply. In accordance with the Civil Code:
- the tenant obtains consent from the landlord;
- the lessor subsequently compensates for the cost of the work.
Thus, it is possible to exclude compensation with the consent of the owner only by including a special condition in the contract. In other cases, the owner is obliged to reimburse their cost to the tenant.
Tax issue
Under an agreement between individuals, inseparable improvements do not need to be declared. And legal entities - firms of any organizational and legal forms - must take these transactions into account when calculating taxes.
At the same time, the nuances of accounting and taxation will depend on the company’s accounting policy, taxation regime and even the period of use of improvements in the company’s activities.
Attention! On the issue of accounting for improvements to the premises in the balance sheet of the enterprise, you can consult with the portal’s on-duty lawyer.
