A mechanism is defined for the precise determination of income and expenses deducted from income in the field of building construction for tax purposes.
“Unikal” reports that this issue was reflected in the proposal to amend the Tax Code, which was discussed today at the meeting of the Milli Majlis.
According to Article 130.6 of the Tax Code, income related to the presentation of residential and non-residential areas by persons engaged in building construction activities and expenses deducted from this income are the amount of residential and non-residential areas presented for the works. (stages) carried out during the fiscal year. The amounts excluding VAT are determined based on the costs incurred in relation to the construction of those areas, including the costs incurred in relation to the purchase of land.
According to the project, a rule is added to article 130.6 of the Tax Code with the objective of regulating the procedure for determining the portion of income and expenses deducted from income under long-term contracts for each financial year. Thus, the determination of the income from long-term contracts and the part of the expenses deducted from the income of each year will be carried out as follows:
– the costs incurred for each building under construction are compared with the estimated total costs for the building and the specific weight of the actual costs incurred in the total costs is determined;
– the sales value of the residential and non-residential areas presented from that building is attributed to the taxable income in the proportion of the volume determined in the aforementioned manner;
– actual expenses incurred are allocated to expenses deducted from income.
After discussions, the issue was put to a vote and accepted on first reading.
