Tax Innovations For Those, Who Built Houses And Cottages With Their Own Assets, Introduced In Belarus

They also raised the income tax for those who "live beyond their means".

Since January 1st the Tax Code of Belarus is updated. Among other things, the tax authorities will correlate incomes and expenditures in a new way. The novelties will also apply to those who build houses on their own (that is, without the help of developers). For them, the amount spent on the construction of housing will be determined. The website zerkalo.io tells about the tax changes.

Changes for those who build a house using their own resources

The Tax Code spelled out how to determine the amount of money spent on construction of a house by a person whose income is checked by tax inspectors. We are talking about those cases when developers or contractors have not been engaged for this, i.e. the house was built using personal resources. For example, relatives or acquaintances helped with the construction.

Earlier, the tax inspectors complained that the Belarusians, whose income and expenditures they checked, often claim expenses for the houses and cottages built at 10-20% of their market value. In other words, they declare only a part of expenses for construction of such houses. We are talking about hard-wall structures, isolated premises, parking lots.

Tax officials have presented several options how to determine the costs of building such a house. One of the options is to let the person himself determine the value of the real estate. But it must not be less than 70% of the value that the tax office determines for real estate tax as of January 1.

It is also possible to provide the tax authorities with an appraiser's report (this can be either a sole proprietorship or a legal entity that does such appraisals).

Income tax has been raised for those living beyond their means and new declarations have been introduced

Officials have abandoned the requirement to request income and asset declarations. Previously, tax officials had asked for such information from anyone whose income and expenses were inspected. They expect this to shorten the period of inspections. They also doubled the amount of excess expenditure over income, when tax officials ask for explanations of where the person got the "extra" money. It was raised to 500 basic units (now it is Br16 thousand).

The authorities also increased the income tax on the amount of excess expenditure over income to 20% (previously it was 16%).