Inheritance and gift for non-residents: what taxes need to be paid before filing documents

Foreigners who receive property as an inheritance or as a gift from citizens of Ukraine must pay the taxes stipulated by law in advance. Without confirmation of their payment, the notary will not be able to issue a certificate of the right to inheritance or certify a gift agreement.

This was reminded by the State Tax Service of Ukraine.

A gift to a non-resident is taxed according to the rules of inheritance

In accordance with paragraph 174.6 of Article 174 of the Tax Code of Ukraine, property received by a non-resident as a gift from a resident of Ukraine is taxed according to the same rules as inheritance.

What taxes must be paid

If the heir or donee is a non-resident, and the testator or donor is a resident of Ukraine, the following rates apply regardless of the type of property:

18% – personal income tax (PIT);

5% – military levy.

The obligation to pay these payments falls directly on the heir or donee.

When taxes need to be paid

The State Tax Service emphasizes that personal income tax and military duty must be paid before the notarial registration of the inheritance or gift agreement.

If the registration is carried out in a settlement where notarial actions are performed by an authorized official of a local government body, taxes must also be paid before the relevant documents are issued.

Without a document confirming the full payment of the tax and military duty, the notary or authorized official does not have the right to issue a certificate of the right to inheritance or certify the gift agreement.

Where to pay taxes

Personal income tax and military duty are paid at the place of notarial registration of the inheritance or gift agreement.

The following budget classification codes are used for transferring funds:

11010501 — “Personal income tax paid by individuals who are not subject to mandatory declaration”;

11011000 — “Military levy”.

The State Tax Service recommends that non-residents fulfill their tax obligations in advance in order to avoid delays in registering an inheritance or gift agreement.