Attention to All Land Users: The Procedure for Paying Land Lease Fees Has Been Changed

Unification of benefits

Reducing coefficients to the amount of annual rent are established for land plots (parts thereof) on which permanent structures (buildings, structures) erected after January 1, 2019 are located. Their size depends on the period of time that has passed since such buildings were accepted into operation and is set from 0.2 for the second year and to 0.8 for the fifth.

For land lease, the same list of cases when rent is not charged is established as in the Tax Code for benefits in relation to other types of rights. For example:

 

• from budgetary organizations when they lease capital structures (buildings, structures) or other paid or gratuitous use for a period of up to one calendar month;
• from technology parks if they lease real estate to their residents.

The procedure for determining an increase (decrease) in the amount of payment

The decree gave local executive committees the right to increase (decrease), but not more than twice, the amount of annual rent for certain categories of tenants (with the exception of residents of free economic zones, special tourist and recreational parks, to whom land plots are provided by the administrations of free economic zones).

There are no cases for which the possibility of a larger increase in the rent would remain.

Let us remind you that previously executive committees could set up to ten times the rent for land plots used not for their intended purpose, not used within the time limits specified by legislative acts, unauthorized occupied, as well as occupied by buildings included by the executive committees in the list of unused (ineffectively used) capital structures (buildings, structures).

Dedollarization

The Decree contains a unified rule for establishing the amount of rent in Belarusian rubles, regardless of the date of cadastral valuation of land.

Previously, two different mechanisms were established for calculating rent based on the date of cadastral valuation of land - in US dollars with translation into Belarusian rubles at the rate established by the National Bank of Belarus on 01.01 of the decision to provide the site and in Belarusian rubles.

Clarification of the procedure for calculating rent

To determine the annual rent, a number of innovations have been established:

 

• the base coefficient for determining the fee for sections of the public and business zone for the placement of automobile gas stations and gas filling stations has been reduced from 0.03 to 0.02;
• a separate coefficient has been allocated for determining the fee for sections of the public and business zone for the placement of automobile markets and gambling establishments in the amount of 0.03;
• There was a slight increase in the cadastral value, until which fixed rental rates were established, which, by the way, also increased slightly.

—We recommend checking the impact of the new norms on the amount of rent, and if a reduction in the amount of payment is established, contact the executive committee to sign an additional agreement to the lease agreement,- says the lawyer.

Control over the completeness and timeliness of rent payments

Now such control falls within the competence of the tax authorities. Local executive committees and administrations of free economic zones are deprived of this right. The Decree established the approach of actually equating rent to taxes and fees (duties):

 

• rent payers enjoy the rights and perform the duties established for tax payers;
• offset (refund) of overpaid (collected) amounts of rent is carried out by the tax authorities in the same manner as for taxes.

 

In turn, when exercising control, applying methods for ensuring the payment of rent and penalties, collecting these fees and penalties, tax authorities exercise the rights and fulfill the responsibilities established for exercising tax control, applying methods for ensuring the fulfillment of tax obligations, collecting taxes, fees (duties) and penalties.

Responsibility

Non-payment or incomplete payment of rent, violation of the deadline for the submission of rent payers calculation of its amount entails liability established for non-payment, incomplete payment of taxes, violation of the established deadline for submitting a tax return (calculation).

Recommendations

The Decree does not provide for the mandatory bringing of land lease agreements concluded before its entry into force (05.15.2020) into compliance with it, except in cases where tenants apply for this.

It is advisable to initiate such an appeal in the case when, as a result of an analysis of the procedure for calculating rent by the tenant, a reduction in the amount of rent is established.