Since August 10, 2015 St Petersburg Land Resources and Land Management Committee (further the “Committee”) has started surveying buildings to determine their actual use^[1].

These inspections have been put into place because property tax payable by organizations in St Petersburg is calculated on the basis of the cadastral value of buildings, if, among others:

– The area of building / premises exceeds 3,000 m² and it is actually used to house business, administrative or commercial facilities, offices, as well as retail, catering and service facilities^[2].

If after surveying the Committee finds out that a property is actually used for the purposes mentioned above, although other purposes are specified in the property documentation, the taxpayer will be required to pay taxes on the basis of the property’s cadastral value.

It is important to note that cadastral values may exceed not only book values, but also market values, so that the surveys conducted by the Committee could result in a significant increase in the amount of payable property tax. Taxpayers are, however, entitled to contest the cadastral values of their properties if they are not in line with their market values, and may thereby reduce their tax burden.

A list of properties that will be surveyed to determine their actual use has been posted to the website of St Petersburg Property Committee here.

If necessary, Awara specialists would be pleased to provide legal support during property surveys, as well as to contest survey results and property cadastral value.

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[2] St Petersburg laws No. 243-44 dated 29.04.2014 and No. 645-110 dated 26.11.2014