"The objects of taxation are passenger cars, the year of manufacture of which no more than five years have passed (inclusive) and the average market value of which is more than 375 times the minimum wage. How much will have to be paid in 2024, and is the owner exempt from the tax if he has not received a notification about it from the tax office?". Opinion.
One of the types of property tax (unofficial name "luxury tax") is transport tax. It is paid by both individuals and legal entities, in particular, non-residents who have their own passenger cars registered in Ukraine that are subject to taxation (in accordance with sub-clause 267.2.1 of clause 267.2 of article 267 of the Criminal Code of Ukraine). At the same time, lessees, lessees or users of passenger cars on the basis of a general power of attorney are not payers of transport tax. Truck owners also do not pay this tax.
Which cars are subject to luxury tax?
The objects of taxation are passenger cars, the year of manufacture of which no more than five years have passed (inclusive) and the average market value of which is more than 375 times the minimum wage established by law on January 1 of the tax year (subclause 267.2.1. of clause 267.2 . Art. 267 of the Civil Code).
It should be noted that in 2024 it is 2,662,500 hryvnias based on the calculation that the minimum wage as of January 1, 2024 is 7,100 hryvnias.
At the same time, the Ministry of Economy determines the average market value of vehicles that are subject to taxation. Every year, the ministry publishes on its official website a list of passenger cars, the year of manufacture of which is no more than five years old (inclusive) and the average market value of which is more than 375 times the minimum wage established by law on January 1 of the reporting year. Such a list must contain data on the make, model, year of manufacture, volume of engine cylinders, and type of fuel of cars subject to taxation.
By July 1 of the base tax year, the tax office must send the car owner a tax notification-decision on the payment of tax together with a detailed calculation of the tax amount.
This year, 184 cars were included in this list.
Separately, it should be noted that even if the car is not older than 5 years and its value exceeds 375 times the minimum wage, but it is not on the list of the Ministry of Economy, the transport tax is not paid.
How much will you have to pay for a luxury car?
The tax rate is set per calendar year in the amount of 25,000 hryvnias for each passenger car. Owners of several taxable cars pay for each of them. That is, it will be necessary to pay UAH 50,000 for two cars, UAH 75,000 for three, etc.
Are the tax payment rules the same for legal entities and individuals?
The transport tax rate is the same for legal entities and individuals, but the procedure for calculating and paying the tax is different . Calculation of the amount of tax for individuals is carried out by the control body independently at the tax address (place of registration) of the tax payer specified in the registration documents for the vehicle.
By July 1 of the base tax year, the tax office must send the car owner a tax notification-decision on the payment of tax together with a detailed calculation of the amount of tax and the relevant payment details for its payment.
If an individual does not agree with the calculated amount of tax, he can apply to the control body at his tax address (place of registration) with a written application for reconciliation. In case of discrepancies between the data of the control body and the data of the taxpayer, which are confirmed by the originals of the relevant documents (in particular, the title documents for the car), the control body at the place of registration of the taxpayer conducts a recalculation of the tax amount and sends (hands) him a new tax notification-decision. The previous tax notice-decision is considered cancelled.
At the same time, it should be remembered that if the control body did not send (did not hand over) a tax notice-decision to an individual within the prescribed time frame, this does not exempt the individual from paying such tax.
The Supreme Court, in its ruling dated June 20, 2022, in case No. 826/15940/18, stated that failure by the control body to charge the taxpayer with transport tax for the relevant year and deliver a tax notice-decision by July 1 of the basic tax (reporting) year period exempts the taxpayer only from responsibility for late payment of the tax liability, but does not exempt the taxpayer from the obligation to pay such tax if there are appropriate legal grounds.
It should also be noted here that very often there are cases when the non-receipt of a tax notice-decision is due to a change in the address of the taxpayer's residence, which he did not inform the tax authority about.
The current tax legislation imposes on taxpayers the obligation to submit to the control body information about a change in their place of residence within a month from the date of such changes by submitting a corresponding application in the 5DR form.
Therefore, in the event that the taxpayer fails to fulfill the obligation to inform the tax office about the change of his address, sending this person a tax notice-decision at the old place of registration will be considered legitimate. Therefore, the tax notice of the decision will be considered served on the day indicated by the postal service in the notice of service with an indication of the reason for non-delivery, among which the impossibility of finding the actual location of the taxpayer.
The current tax legislation imposes on taxpayers the obligation to submit to the control body information about a change in their place of residence within a month from the date of such changes.
The situation with legal entities is different. They must independently calculate the transport tax by submitting an annual declaration to the control body with a breakdown of the annual amount into equal parts on a quarterly basis. The deadline for submitting such a declaration is February 20 of the reporting year. If the car was purchased in the middle of the reporting year, such a declaration is submitted within a month from the date of ownership of this car. In the event that a legal entity acquired ownership of a car and sold it during the same calendar month, the obligation to submit a transport tax declaration and, accordingly, to pay it, does not arise.
When to pay tax?
Individuals must pay the tax within 60 days from the date of delivery of the tax notice-decision. Legal entities pay quarterly advance payments by the 30th of the month following the reporting quarter, which are reflected in the annual tax return. For cars purchased during the year, the tax is paid in proportion to the number of months remaining until the end of the year, starting from the month in which ownership of the vehicle arose.
And if the car is stolen, do you still have to pay tax?
In case of theft of a taxable car, the transport tax is not paid from the month following the month in which the fact of illegal possession took place. At the same time, the illegal possession must be confirmed by the relevant document on the entry of information about the commission of a criminal offense into the Unified Register of Pretrial Investigations, issued by an authorized state body. In such a case, the legal entity must submit a clarifying declaration within 30 calendar days from the date of entering the information into the ЕРДР.
If a stolen car is returned to the owner, the tax for it is paid from the month in which it was returned, in accordance with the resolution of the investigator, prosecutor or court decision. In addition, the taxpayer is obliged to provide the control body with a copy of this resolution (decision) within 10 days from the moment of its receipt, and legal entities must also submit a clarifying declaration within 30 calendar days from the date of drawing up the resolution of the investigator, prosecutor or court ruling.
If the tax was paid late or not paid at all
In case of failure to pay the tax within the time limits established by the law (mentioned above), the taxpayer incurs a tax debt. If the amount of tax debt exceeds 180 of the tax-free minimum income of citizens (i.e. UAH 3,060), a tax demand is sent to the taxpayer, and the taxpayer's property is transferred to a tax lien.
Property to which the right of tax lien applies is drawn up with a deed of description. Such an act of description is drawn up by the tax administrator on the basis of the decision of the head (his deputy or authorized person) of the control body.
Also, the Tax Code of Ukraine provides for the application by the tax authority of the administrative seizure of property against individuals who have a tax debt and go abroad. This seizure is an exclusive way of ensuring that the taxpayer fulfills his obligations.
Seizure of property can be imposed by the decision of the head (his deputy or an authorized person) of the control body, the validity of which must be verified by the court within 96 hours. Seizure of funds in the taxpayer's account / electronic wallet is carried out exclusively on the basis of a court decision by applying to the court of the control body. Collection of tax debt from individuals is carried out exclusively on the basis of a court decision. The court's decision to collect a tax debt from an individual is executed in accordance with the Law of Ukraine "On Enforcement Proceedings".
Collection of tax debt from individuals is carried out exclusively on the basis of a court decision.
During the execution of the court decision, the debtor's funds and property are seized and enforced. Funds are charged first (in cash and on accounts). If the debtor does not have enough funds to repay the debt, the collection is applied to the debtor's property, first - to movable property, and if such property is not sufficient, then to a plot of land separate from the house, other premises belonging to the debtor. The last step is the recovery of the residential building or apartment in which the debtor actually lives.
If the taxpayer pays the tax on his own, but in violation of the established terms, then a fine of 5% of the repaid amount of the tax debt will be applied to him in case of delay in payment up to 30 calendar days inclusive, following the last day of the deadline for payment of the amount of the monetary obligation knitting And in case of delay for more than 30 calendar days — in the amount of 10% of the repaid amount of the tax debt. Also, in case of violation of the terms of payment of tax obligations, a penalty is charged for each calendar day of delay, in particular the day of repayment, at the rate of 120% of the annual accounting rate of the National Bank of Ukraine, valid for each such day.
