An extract from the technical documentation regarding the normative monetary valuation (NMV) of a land plot must be submitted by taxpayers to the tax authority in two cases (in accordance with paragraph 286.2 of Article 286 of the Tax Code of Ukraine):
– when the taxpayer submits the first declaration (the actual commencement of activity as a land tax payer);
– in the event of approval of a new normative monetary valuation of the land.
At the same time, owners or users of land plots may obtain extracts from the NMV an unlimited number of times. However, only those indicators that have entered into force in accordance with the established procedure are used to determine the tax liability for land tax.
When does a new normative monetary valuation affect the tax amount?
New data on the normative monetary valuation of a land plot are used to calculate land tax from the moment such data take effect.
The entry into force of council decisions establishing the normative monetary valuation of land plots is regulated by Article 271 of the Code.
Local government bodies:
– adopt decisions on establishing or updating the normative monetary valuation;
– publish them by July 15 of the year preceding the budget period in which the new valuation is to be applied.
If the decision is published later, it shall apply no earlier than the beginning of the budget period following the planning period.
Exceptions to the general rule
The provisions of the Code regarding the entry into force of decisions do not apply to council decisions regarding:
– the normative monetary valuation of state- and municipally-owned land plots located outside populated areas that are leased;
– lands for which a normative monetary valuation has not previously been conducted or has not been duly approved, provided that the amount of such normative monetary valuation of the land plots exceeds the normative monetary valuation of the corresponding area of arable land in the region.
In such cases, the council’s decision:
– shall be published no later than 10 days from the date of adoption of the relevant decision;
– takes effect on the first day of the second month following the month of adoption.
A common mistake made by taxpayers
Taxpayers receive and apply extracts regarding the normative monetary valuation of land in accordance with the Methodology approved by Resolution of the Cabinet of Ministers of Ukraine No. 1147 dated November 3, 2021, even if, after 2021, the local government authority did not adopt or publish a decision approving new technical documentation on the normative monetary valuation for these lands.
Such application may result in both an understatement and an overstatement of tax liabilities.
At the same time, paragraph 4 of Resolution No. 1147 provides that technical documentation on normative monetary valuation approved earlier (prior to the entry into force of the new Methodology), taking into account the requirements of Article 271 of the Tax Code of Ukraine, remains in effect until the decision of the relevant council approving the new technical documentation begins to apply.
