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Is land subject to taxation? Can a discrepancy in the report lead to a penalty?
Is land subject to taxation? Can a discrepancy in the report lead to a penalty?
We inform you that the object of taxation for property tax of a legal entity consists of fixed assets recorded on the enterprise’s balance sheet — i.e., tangible assets with a useful life of more than one year and a value exceeding 500 manats, which are subject to depreciation in accordance with Article 114 of the Tax Code.
Since land is not subject to depreciation, it is not classified as a fixed asset and is not considered an object of property tax.
We also inform you that according to Article 58.1 of the Tax Code, if the amount of tax (including tax withheld at the source) indicated in the tax report is lower than the amount that should have been reported, or if the amount of tax payable to the state budget has been evaded by failing to submit a report, a financial sanction equal to 50% of the underreported or evaded tax amount (excluding additional tax amounts assessed as a result of a desk tax audit) shall be applied to the taxpayer, except for the case specified in Article 58.1-1 of this Code.
Please note that under Article 72.5 of the Tax Code, unless otherwise provided by Article 163 of this Code, if the data in previously submitted reports do not match the data in primary accounting documents, the taxpayer must submit a revised report for the relevant reporting period. If the amount of tax payable to the budget according to the revised report exceeds the amount payable under the previously submitted report, the additional calculated tax amount must be paid to the budget together with interest. If the revised amount is less, the calculated tax and interest amounts shall be reduced. Revised or late-submitted reports may be submitted by the taxpayer up until the start date of a field tax audit.
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We inform you that the object of taxation for property tax of a legal entity consists of fixed assets recorded on the enterprise’s balance sheet — i.e., tangible assets with a useful life of more than one year and a value exceeding 500 manats, which are subject to depreciation in accordance with Article 114 of the Tax Code.
Since land is not subject to depreciation, it is not classified as a fixed asset and is not considered an object of property tax.
We also inform you that according to Article 58.1 of the Tax Code, if the amount of tax (including tax withheld at the source) indicated in the tax report is lower than the amount that should have been reported, or if the amount of tax payable to the state budget has been evaded by failing to submit a report, a financial sanction equal to 50% of the underreported or evaded tax amount (excluding additional tax amounts assessed as a result of a desk tax audit) shall be applied to the taxpayer, except for the case specified in Article 58.1-1 of this Code.
Please note that under Article 72.5 of the Tax Code, unless otherwise provided by Article 163 of this Code, if the data in previously submitted reports do not match the data in primary accounting documents, the taxpayer must submit a revised report for the relevant reporting period. If the amount of tax payable to the budget according to the revised report exceeds the amount payable under the previously submitted report, the additional calculated tax amount must be paid to the budget together with interest. If the revised amount is less, the calculated tax and interest amounts shall be reduced. Revised or late-submitted reports may be submitted by the taxpayer up until the start date of a field tax audit.
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