Transfer of property in general and definitions
Taxation of gains received from transfer of property in general is discussed in the Income Tax Act, and here we are viewing charging the income tax on gains or income received from the following property transactions only:
- gains from transfer of a real thing or movable (sale or intermediation);
- gains from intermediation of immovable property;
- gains from transfer or intermediation of advance reservations as a proprietary right.
Consequently, “the property” means primarily the immovable property (e.g. land, buildings or structures, apartments) but also movables (e.g. timber).
Immovable means a delimited part of surface of the earth or a plot of land, the essential parts of which are permanently attached things (structures, growing forest, other plants, unharvested crop), which together with the land form a separate registered immovable.
A thing, which is not immovable, is movable (e.g. timber).
Registered immovable is an immovable (plot of land), building lease, usufruct, apartment ownership or apartment building lease entered as a separate immovable in the land register. An independent register part is opened in respect of each immovable entered in the land register and a unique number (registered immovable number) is assigned to it.
Right of superficies means encumbrance of an immovable with a right that would provide a person, who is not the owner of an immovable, to develop a housing on an immovable. Right of superficies may be encumbered and transferred as an immovable. A person, in whose favour the right of superficies has been established, has the right to have a permanently attached building on his or her immovable. Besides the land under construction, the right of superficies is extended to the part of an immovable which is necessary for use of the building.
Right of superficies in apartments is limited real right, the object of which is a delimited dwelling or non-residential premises of a construction that enable separate use.
Usufruct is a restricted real right encumbering a thing (e.g. land) in such a manner that a person, in whose favour the usufruct has been established, has the right to use a thing and obtain its fruits; the owner of a thing preserves the ownership right. Usufruct may be established both on an immovable or movable. Usufruct is established on an immovable at the moment of entering it in the land register. Usufruct is established on a movable at the moment of transfer of a thing from the owner to the recipient of usufruct and concluding an agreement on usufruct.
A registered dwelling in a block of apartmentss is an example of an object of an apartment ownership.
Expropriation of an immovable means transfer of an immovable without the owner's consent in the public interests and for fair and immediate compensation.
Residential space privatised on the basis of the right of pre-emption is a house or an apartment, which the entitled person has acquired through privatisation on the basis of the Residential Privatisation Act.