Transfer of Real Estate Management: Who Remains the Taxpayer
Owners of residential and non-residential real estate, including individuals and legal entities, as well as non-residents, are obliged to pay tax on real estate other than land plots. This requirement is established by the Tax Code of Ukraine.
Both entire objects of residential or non-residential real estate and shares in ownership rights to them are subject to taxation.
A property management agreement provides that the owner transfers their property to another person — the manager — for a specified period. The manager, for a fee, manages the property on their own behalf but exclusively in the interests of the owner or the beneficiary designated by them.
The subject of such an agreement can be an enterprise as a single property complex, real estate, securities, property rights, and other assets.
At the same time, the owner remains the principal of the management. Even if the agreement stipulates that the manager is a fiduciary owner and has the right to possess, use, and dispose of the property within the agreement and the law, ownership rights do not transfer to them.
Moreover, the property transferred to management is accounted for by the manager separately from their own assets, and separate accounting records are maintained for it.
Thus, transferring real estate to management does not change its owner. The manager only manages the property, while all ownership rights remain with the principal of the management.
That is why the obligation to pay tax on real estate other than land plots lies with the owner of the real estate, even if it is transferred to management by another person.
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