The Ministry of Finance has explained the procedure for calculation of incomes received from realization of real estate objects by sole traders applying the simplified taxation system
The Ministry
of Finance of Russia has informed in its
Letter N 03-11-02/210 of July 4, 2007 (document is in Russian)
that at solving of the question of taxation of incomes of sole
traders applying the simplified taxation system, which had been
received from sale of real estate belonging to them, not used
for entrepreneurial activity (a flat, a garage etc.), there
shall be guided by provisions of
chapter 23 "Tax on incomes of natural persons" of
the RF Tax Code (document is in Russian).
At realization
of real estate objects acquired for further realization by sole
traders applying the simplified taxation system, incomes from
their realization are subjects for taxation within the frameworks
of the simplified taxation system, and if objects of real estate
have been acquired for making entrepreneurial activity not connected
with their further realization, than cost of such objects shall
be taken into account within the composition of expenditures
at determination of tax base, in order established by
clauses 3 and
4 of article 346.16 and
clauses 2.1 and
4 of article 346.25 of the RF Tax Code.
At determination
of tax base on the tax paid in accordance with application with
the simplified taxation system, there shall not be taken into
account expenditures on acquisition of real estate objects maid
by a natural person before his state registration as sole trader
and transfer to the simplified taxation system.
