• 10/5/2021

Industrial Land Tax

What is a tax on industrial land? Have you recently become the owner of a land plot or are you just thinking about buying it? Then it is useful for you to know that after buying the land, you have to pay land tax.

If you are renting a plot without owning it, you do not have to pay. The tax rate on industrial land and other land properties is determined by local authorities. It depends on the category of land and the territory where the lot is located. 

The tax amount is made up of several indicators:

  • Tax rate;
  • Cadastral lot value;
  • Possible benefits.

Payments apply to individuals and legal entities, as well as individual entrepreneurs.

Who determines whether the tax must be paid?

Any land tax is local, therefore it is established and regulated by the Tax Code of the Russian Federation and regional authorities. In the cities of federal significance – Moscow, St. Petersburg, and Sevastopol – the tax is regulated by the laws of these Russian Federation entities. This also applies to the tax on industrial land, which applies to the land lots of large enterprises, factories, plants, and corporations.

The law provides benefits for individuals and organizations. Some beneficiaries are subject to easing of some tax requirements, while others are completely exempt from payments. Beneficiaries include charities and government companies, disabled people, veterans, and others. Municipalities can establish additional benefits on their territory. 

In St. Petersburg, tax benefits are subject to the following rules. The following are exempted from taxation in relation a single land lot within the city:

  • lifelong disabled people and the disabled of group I, as well as groups II and III with limited ability to work;
  • veterans and disabled veterans of the Great Patriotic War and military operations;
  • heroes of the USSR and the Russian Federation, heroes of Socialist Labour, full holders of the Orders of Glory and Labor Glory;
  • parents or guardians of children with disabilities;
  • participants in nuclear weapons tests, liquidation of accidents at nuclear power plants and military facilities, as well as those harmed during these works;
  • pensioners – for a plot of up to 2500 sq. m;
  • retired military personnel with a service life of 20 years or more;
  • family members of civil servants and military personnel who have lost their breadwinner in the line of duty.

State research centers of the Russian Federation in St. Petersburg have the right to pay 35% of the land tax. State authorities, autonomous, budgetary, and state institutions created by the city are completely exempt from tax.

You can find out more about all federal and local benefits on the official website of the Federal Tax Service.

How to calculate the value of industrial land tax?

Industrial land is classified as "Other land lots," which means that the maximum tax rate for them is 1.5%. Local governments have the right to lower the rate for land on their territory.

The period for paying industrial land tax for legal entities is every three months - that is, once a quarter. It is paid in advance at the end of each reporting period at the end of April, July, and October. By law, the last quarter can be paid for until February 1 of the next year.

Individuals and individual entrepreneurs are required to pay tax every year. The deadline for payment for the reporting period is December 1 of the following year. That is, the tax for 2021 must be paid no later than December 1, 2022.

The land tax for individuals is calculated by the Federal Tax Service, and legal entities make their own calculations. Doing this does not require complex calculations: the amount of payments can be calculated online on the official website of the Federal Tax Service or using an online calculator.  To calculate the tax yourself, you will need the following data:

  • Cadastral lot value;
  • Tax rate;
  • Share in ownership;
  • Ownership period;
  • Benefits and tax deductions.

Information about the cadastral value of a land lot is easy to find on the public cadastral map. For greater accuracy, you can order an extract from the USRT. The tax rate for different federation entities can be found out using the reference source of the tax service.