Sale of inherited real estate

It is not uncommon for inherited real estate to be put up for sale. To avoid unpleasant surprises when selling an inherited apartment or house, you need to do everything correctly from the beginning. We tell in this article, when you can sell such a living space, what documents for this will be needed and whether the heir will have to pay taxes.

When you can sell inherited real estate

If a relative has died and indicated in his will to whom he transfers his real estate, the heir must necessarily enter the inheritance and become the legal owner of the living space. Otherwise, he will not be able to conduct any transactions with this property, including selling it.

It is necessary to enter the inheritance within 6 months after the death of the testator. During this period, the heir applies to the notary and submits an application about his/her intention to enter the inheritance. The notary in turn opens the inheritance case. At this stage, the apartment still cannot be sold.

What documents must be submitted to a notary to formalize ownership of inherited real estate:

• will;
• the testator's death certificate;
• a document that confirms the kinship with the testator.

If the will specifies that real estate is to be inherited by several people at once, it is divided into equal parts between all claimants. It is also possible for one heir to pay compensation to another heir if they both agree.

When 6 months have passed after the death of the testator, the heir must go to the notary again to obtain a certificate of right to inheritance. It is this document that confirms the legal ownership of the real estate. If you have a certificate, you can do anything with the property: give, sell, inherit.

What documents are needed to sell inheritance real estate

When the title to residential real estate is registered, the new owner can immediately put it up for sale. The transaction is carried out according to a standard procedure, just like normal residential sale and purchase transactions.

To conclude a sale and purchase agreement for an inherited apartment, the seller must provide the following documents:

• Title documents, i.e. certificate of inheritance rights;
• passport of the owner (if there are co-owners, their passports too);
• a certificate of persons registered in the dwelling;
• permission of the guardianship authorities (if there are registered minor relatives).

When selling a residential property, the seller gives the buyer technical documents for the real estate and a statement that confirms that all utilities have been paid in full.

Taxes on the sale of inherited real estate

When it comes to taxes on the sale of an inherited apartment or house, the question should be considered in two stages, since there is a tax on entering the inheritance and taxes on its sale. Let's consider each stage separately.

Taxes at the entry into inheritance

If we talk about taxes on inheritance, its amount is affected by the degree of kinship of the heir with the testator. According to the legislation of Ukraine, for receiving an inheritance of an apartment or house will have to pay tax at the rate of 0%, 5% or 18% of the estimated value of the property.

First degree relatives are taxed at the zero rate. This may be the testator's husband or wife, his parents, children, including adopted children and those born in another marriage. There is no need to pay tax also to relatives of the second turn. These include brothers and sisters, grandparents and grandchildren. The 0% tax also applies to privileged categories: orphans, heirs with Group I disability, and children with disabilities.

If the heir does not belong to the first or second line of relatives, as well as to the privileged category, he will have to pay tax at the rate of 5%.

The highest interest rate (18%) is set if the testator was a resident of Ukraine and the heir is a non-resident.

Both those who pay the 5% tax and those who pay 18% are also obliged to pay a military levy of 1.5%.

Taxes on the sale of inherited real estate

When real estate received as an inheritance is sold, favorable taxation conditions apply. As stated in paragraph 171.1 of the Tax Code of Ukraine, income from the sale of an inherited apartment or house is not taxable regardless of the period of ownership: less than 3 years or more than 3 years.

An heir who has formalized the title of ownership, can immediately sell the property and still not pay tax. If it is a question of selling several objects received as an inheritance, then in this case the general legislative norms apply. For the first sale during the reporting period, the owner does not have to pay tax. For the second, third and subsequent sales of inherited property during the year, the seller will be obliged to pay taxes.

To be sure to do everything correctly and avoid any unpleasant surprises in the sale of inherited real estate, it is best to immediately contact experienced realtors. In Mayak Real Estate Agency also work lawyers and a notary, so there will be no difficulties with the documents. Realtors will advise how to prepare the apartment for sale, analyze the market and determine the real value of housing, will promote the property and find a buyer as soon as possible. With the Mayak Real Estate Agency will be able to sell inherited housing quickly and legally.