Thousands of Ukrainians pay a ‘luxury tax’ on their housing, but certain categories of citizens are exempt from this obligation.
In Ukraine, property tax is payable by owners of apartments and houses that exceed certain limits of total floor space: more than 60 square metres for apartments and 120 square metres for houses. Only the area in excess of these limits is taxed, not the living space, but the total area of the property.
Anyone who owns a home that is smaller than the established limits does not have to pay the ‘luxury tax’.
Who is eligible for exemption from real estate tax
Natalia Chatskis, a lawyer at Nakaz Law Firm , explains that there are certain social categories of Ukrainians who, even if they have a large area of real estate, are not obliged to pay this tax. Among them are those who suffered from the war and belong to specially protected groups.
Firstly, the tax is not paid by owners of residential properties that are unfit for human habitation, in particular due to their emergency condition. However, this status must be officially recognised by a decision of the local authorities.
Orphans, children without parental care, and children with disabilities raised by single parents are also exempt from the tax. This applies to only one residential property if it is owned by the child as property.
Associations of persons with disabilities are also not obliged to pay real estate tax if they are the owners of the property. However, individual property owned by a disabled person does not qualify for this exemption. There are also exemptions for large families and foster families raising five or more children.
Another exemption applies to property located in areas where hostilities are taking place or in the territories occupied by Russia. If a person with IDP status purchases real estate that exceeds the limits, for example, in Lviv, the tax will have to be paid for the excess metres.
In addition, the tax does not apply to housing that requires major repairs due to war damage.
There are no special tax exemptions for the military and ATO participants at the national level, but local councils can make their own decisions on exemptions from this tax. The situation is similar for pensioners: if the area of their real estate exceeds the established norms, the tax remains mandatory.
How to avoid paying property tax
If the property exceeds the established metres, you can reduce the tax burden by sharing ownership with another person. This can reduce the tax burden, notes Natalia Chatskis.
