Calculation of gains and loss derived from transfer of property

(1) The gains or loss derived from the sale of property (subsection 15 (1)) is the difference between the acquisition cost and the selling price of the sold property. The gains or loss derived from the exchange of property is the difference between the acquisition cost of the property subject to exchange and the market price of the property received as a result of the exchange. A taxpayer has the right to deduct certified expenses directly related to the sale or exchange of property from the taxpayer’s gain or to add such expenses to the taxpayer’s loss.

(2) In the case of transfer of property the acquisition cost of which the taxpayer has deducted from the taxpayer’s business income, the selling price of the property or the market price of the property received through exchange is deemed to be business income derived by the taxpayer.

(3) If a taxpayer has deducted the depreciation of fixed assets calculated on the basis of the Income Tax Act in force before the entry into force of this Act from the taxpayer’s business income and if the fixed assets are transferred, the acquisition cost of such fixed assets is, upon calculation of the gains, reduced by the amount of the depreciation of the assets.

(4) Upon taking property specified in subsection (2) into personal use (either during engagement in business or in the case of termination of engagement in business), the market price of the property is included in the taxpayer’s business income. Upon any future transfer of such property, the amount which pursuant to this subsection is added to business income is deemed to be the acquisition cost of the property.

(5) Upon taking property specified in subsection (3) into personal use (either during engagement in business or in the case of termination of engagement in business), the market price of the property minus the difference between the acquisition cost and the depreciation of fixed assets is included in the taxpayer’s business income. Upon any future transfer of such property, the amount which pursuant to this subsection is added to business income is deemed to be the acquisition cost of the property.

(6) If the activities of a sole proprietor are suspended pursuant to the provisions of the Commercial Code and the activities of a notary, sworn translator or bailiff are suspended pursuant to the provisions of the Taxation Act for longer than twelve months, the assets specified in subsections (2) and (3) of this section are deemed to have been taken into personal use.
[RT I 2008, 60, 331 - entry into force 01.01.2009]

(7) If the assets of a sole proprietor which belonged among the assets of an enterprise are transferred or bequeathed to a person who will continue the activities of the enterprise, the assets shall not be deemed to have been taken into personal use. The procedure for application of tax exemption upon transfer of the assets shall be established by a regulation of the Minister of Finance.
[RT I, 18.11.2010, 1 - entry into force 01.01.2011]

(8) Upon the transfer of the right to cut standing crop and felled timber, certified expenses relating to forest management shall also be deemed to be expenses related to the transfer and the taxpayer has the right to deduct the expenses from the income received from the transfer of the right to cut standing crop or felled timber during the same period of taxation or three following periods of taxation if the following conditions are met:
1) forest management is carried out, as defined in the Forest Act;
2) the owner of the forest has submitted a forest notification concerning the forest management activity to the Environmental Board in the case provided for in the Forest Act and the Environmental Board has permitted the activity planned in the forest notification.
[RT I, 08.07.2011, 5 - entry into force 01.01.2012]

(9) The expenses relating to forest management for the purposes of subsection (8) do not include any expenses incurred on account of grant not subject to income tax.
[RT I, 08.07.2011, 5 - entry into force 01.01.2012]

(10) The gains derived from the transfer of the right to cut standing crop and felled timber may be carried forward to up to three following periods of taxation. A taxpayer has the right to reduce the gains carried forward by the expenses specified in subsection (8) which were incurred during this period of taxation.
[RT I, 08.07.2011, 5 - entry into force 01.01.2012]

Дата добавления: 2015-11-14