Selling residential property in Russia is tax-free if held for 3–5 years depending on how it was acquired. Short-term sales trigger NDFL at 13% on gains. Here's how the rules work and what sellers need to plan for.
Educational content only — not personalized financial, legal, or tax advice.
When you sell residential property in Russia, the transaction may be subject to NDFL, which is the Russian personal income tax. Whether or not you owe tax depends primarily on how long you have owned the property. The Russian Tax Code establishes a minimum holding period threshold after which property sales incur zero capital gains tax.
If you sell a property before the minimum holding period is met, you are generally required to pay 13% tax on the profit. This profit is calculated by subtracting the documented expenses related to the property's acquisition from the total sale price. For example, if you bought a condo for 5 million rubles and sold it two years later for 6 million rubles, you would owe 13% tax on the 1 million ruble gain, amounting to 130,000 rubles. In the absence of original purchase documentation, a standard tax deduction of 1 million rubles applies. In this case, you would only pay tax on the portion of the sale price that exceeds 1 million rubles.
Selling property requires careful record-keeping. The tax authorities (FNS) rely on official documents to verify your acquisition costs. Keep your original purchase contract, bank transfer receipts, and payment confirmations in a secure place. If you are selling an inherited property, ensure your certificate of inheritance is properly registered with the state. Remember that if the sale price is significantly lower than the cadastral value (the state-appraised value) of the property, specifically, less than 70% of the cadastral value, the tax authorities may calculate your tax liability based on that 70% threshold rather than your actual sale price.
Even if you sell your property tax-free because you met the minimum holding period, you are generally not required to file a tax return for that transaction. However, if you sell property before the holding period expires, you must file a 3-NDFL tax declaration by April 30 of the year following the sale, and the tax payment must be made by July 15. Consulting with a tax professional or using the official FNS online portal can simplify this process and ensure you remain compliant with current regulations.