Everyone loves receiving gifts, even if they're not as expensive as Georgina Rodriguez's 30-carat diamond ring she received from her future husband Ronaldo.
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In Ukraine, a car, even with low mileage, is considered a good gift. Moreover, in some cases, you can avoid paying tax for such a gift, which cannot but please the person to whom you give it, the Main Service Center of the Ministry of Internal Affairs writes.
The entire process, as well as the tax obligations associated with it, depends on whether the recipient of the gift is your relative or someone who is not related to you.
The Tax Code of Ukraine states that the presence of a gift tax depends on the degree of relationship.
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Family members of the first and second degree of kinship are completely exempt from paying tax. These include:
- parents, children (natural and adopted), husband or wife – this is the first degree of kinship;
- Brothers, sisters, grandchildren, grandparents are the second degree of kinship.
If the car was gifted to a person who does not fall into the categories listed above, he or she will have to make the following payments:
- 5% personal income tax;
- 5% military fee from the cost of the car.
If we are talking about a non-resident, then he will have to pay the same 5% military fee and 18% personal income tax.
The military tax rate for military personnel is 1.5%.
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How to re-register a vehicle under a donation agreement
Re-registration of a vehicle under a donation agreement takes place at the Ministry of Internal Affairs service center on the day of the service. You must bring a list of documents with you:
- passport of a citizen of Ukraine;
- a copy of the certificate of registration number of the taxpayer's registration card;
- a document confirming the authority of the representative (in case of contacting the service center of the Ministry of Internal Affairs by a person who is not the donee or the donor);
- a document confirming the degree of relationship (birth certificate, marriage certificate, etc.);
- vehicle registration certificate.
The donation agreement is drawn up free of charge.
The approximate cost of the re-registration service under a gift agreement: for vehicles of all categories or individual units (with the issuance of a license plate) is UAH 1,306. This includes: administrative service – UAH 350, certificate form – UAH 606, license plate – UAH 350.
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When drawing up a donation agreement, a tax payment receipt must be submitted to the administrator of the Ministry of Internal Affairs service center.
Previously, “FACTS” wrote about when it is worth selling a car so as not to lose money.
