Area: Poslovni SOS
Competent authority: MJU
EZU URL: .nan
Initiative ID: 626
Initiative accepted and completed: '2015-07-14'
Initiative classified in EZU: .nan
Initiative forwarded in response: '2015-07-14'
Initiative published: '2015-07-14'
Initiative submitted: '2015-07-14'
Response from the competent authority: 'MJU Note: We have already received the business
  entity''s initiative describing the issue in question via the Stopbirokraciji website
  last year and obtained the views of the competent authorities on it, which we have
  also informed the business entity about. However, given that certain changes are
  foreseen in the area of tax legislation this year, we have once again asked the
  Ministry of Finance whether the envisaged changes might coincide with the measures
  proposed by the business entity. We publish part of the response of the Ministry
  of Finance (which was already sent to the user last year on 6.6.2014) and the response
  of the Ministry of Finance dated 10.6.2015. RESPONSE OF THE MINISTRY OF FINANCE:With
  regard to the proposal to simplify the collection and tax accounting of rent for
  the letting of common areas, we would like to explain:In the opinion of the initiator,
  the existing regime creates inequality already by the fact that individual floor
  owners who are natural persons and are taxable under the Income Tax Act (Official
  Journal of the Republic of Slovenia; No 117/06 et seq.) do not pass on their tax
  numbers to the manager. Moreover, the owners of the storey are also legal persons
  and therefore taxable under a different tax law than natural persons. This should
  lead to an inequality of tenants who receive the amount of their liability depending
  on the diversity of the floor owners and the possession of their data by the managers.
  This in turn should lead to inequality between managers who comply with the tax
  procedures and those who do not, thereby gaining a competitive advantage. The petitioner
  therefore proposes that these funds (rents) should be compulsorily paid into a reserve
  fund and subject to a new, special tax at the moment of payment.By way of introduction,
  it should be recalled that the current regime for the payment of income tax and
  corporation tax on rents received by unit owners on the basis of the letting out
  of common premises was adopted by the amendment of the Tax Procedure Act at the
  end of 2009 (ZDavT-2B). This regulation was drafted at the initiative of the landlords
  who, until the application of the provisions of the amended law, had to declare
  and pay the income tax on rents themselves. The new regime relieved the administrative
  burden on landlords, who are no longer obliged to submit a separate income tax return
  on rental income. The above-mentioned regulation thus applies irrespective of who
  is the lessor of the common premises (i.e. also in the case when the common premises
  are rented out to natural persons through the manager of a multi-apartment building,
  and not only in the case when they are rented out to legal persons, as was the case
  until the amendment to the law came into force).The new regulation was drafted taking
  into account the applicable substantive sectoral regulations, in particular the
  Housing Act (Official Gazette of the Republic of Slovenia; No. 69/03 et seq.). In
  particular, it should be pointed out that the obligation of the owners or acquirers
  of the ownership right, as laid down in the substantive rules, to keep the manager
  informed of changes in the ownership right, and that the common part of a multi-apartment
  building is managed by the managers of the multi-apartment buildings served by such
  part, in the name of and on behalf of the common owners and on behalf of the common
  owners.According to Article 58(4)(1) of the Tax Procedure Act, the manager of a
  multi-apartment building who receives income on behalf of the owners of the building,
  on which withholding tax is calculated, withheld and paid in accordance with the
  Tax Procedure Act or the Taxation Act, is thus deemed to be the taxpayer.Taking
  into account the provision of Art. 58(2) of the ZDTP-2, the manager of a multi-apartment
  building shall always be deemed to be the payer of the tax on the income of the
  unit owners from the letting of common premises, where the income is paid by a person
  (the lessor) who would otherwise be deemed to be the payer of the tax pursuant to
  point 1 of the first proviso to Article 58(1) of the ZDTP-2. Where the income is
  paid by a natural person (who cannot be regarded as a taxpayer under Article 58(1)(1))
  or a non-resident of Slovenia (the lessee), the manager of the multi-apartment building,
  taking into account Article 58(1)(1)(1), (2) and (3), shall be deemed to be a taxpayer
  under Article 58(1)(1)(1)(b) of the Tax Code. With regard to the petitioner''s claims
  that the existing regulation creates inequality by the very fact that individual
  floor-tenants who are natural persons and are taxable under ZDoh-2 do not submit
  their tax numbers to the manager, we would like to clarify that Article 35(2)(a)
  of ZDoh-2 provides that the tax number of the building owner is to be considered
  as a tax payer in accordance with the provisions of Article 58(1)(a) of ZDoh-2.
  Article 2(2) of the Income Tax Act-2 provides that a natural person must submit
  his/her tax number to the payer of income in all cases where he/she receives income,
  regardless of the form in which it is received. If the natural person fails to do
  so, the income is not paid to the natural person. This means that the manager of
  a multi-apartment building may not pay to a ground-floor owner who is a natural
  person the part of the rent due to him from the common areas unless he provides
  him with a tax number.As the petitioner states, ground-floor owners may also be
  legal persons and therefore subject to tax under a different tax law than natural
  persons. In this respect, we would like to clarify that according to Article 70(3)(2)
  of the Corporate Income Tax Act (Official Gazette of the Republic of Slovenia, No
  17/06 et seq.), tax is calculated, withheld and paid on income paid to a resident
  taxable person who provides his tax number to the payer. This means that if such
  a taxable person does not communicate his tax number to the manager of a multi-apartment
  building, the tax must be calculated, withheld and paid by the manager on the taxable
  person''s share of the rent of the common areas. With regard to the petitioner''s
  allegations that the fact that the owners of the common premises may be both natural
  and legal persons leads to inequality of the tenants receiving the amount of their
  liability, given the diversity of the floor owners and the possession of their data
  by the administrators, we would like to clarify that the amount of the rent is determined
  by the lease agreement (and depending on whether the landlord is a legal or a natural
  person), the obligation to pay income tax (i.e. the obligation to pay the tax on
  the tax on the taxable amount of the lease), the obligation to pay the tax on the
  taxable amount of the lease (i.e.(i.e. on the rent received or part thereof) is
  the obligation of the landlord and not the obligation of the recipient. The obligation
  to pay the tax should therefore not lead to inequality between tenants.As regards
  the petitioner''s allegations that the above would lead to inequality between managers
  who follow the tax procedures and those who do not, thereby gaining a competitive
  advantage, it should be noted that the tax and other rules described above apply
  to all managers of multi-apartment buildings. The Tax Administration of the Republic
  of Slovenia is responsible for monitoring the implementation of, or compliance with,
  the taxation laws and ZDavTP-2. If an individual manager considers that another
  manager(s) is not complying with its obligations under the tax regulations, it may
  report this to the tax administration.With regard to the petitioner''s proposal
  that the rents for the letting of the common areas should be compulsorily paid into
  a reserve fund and taxed at the time of payment with a new special tax, we would
  like to clarify that the rents are the income of the owners of the real estate and,
  as such, are subject to taxation under the laws on the taxation of personal and
  corporate income. The introduction of a special tax merely to administratively simplify
  the obligations of managers of multi-apartment buildings to calculate, withhold
  and pay tax on such rents is therefore not an appropriate measure.This year, an
  initiative has been reiterated via the businessSOS.gov.si website, describing the
  problems already presented in 2014. With regard to the envisaged changes in the
  tax legislation and the question whether the introduction of a special tax for the
  administrative simplification of the obligations of managers of multi-apartment
  buildings will be among the measures, we would like to clarify that the Ministry
  of Finance has received a proposal to change the way in which the tax is calculated
  and paid on the income generated by the floor owners in the form of rents from common
  areas. The content of the proposal is also related to other systemic legislation
  (i.e. the reserve fund is regulated in the Civil Law Code and the Housing Law) and
  to the amendment or supplementation of three tax laws (the Tax Procedure Law - ZDavP-2,
  the Income Tax Law - ZDoh-2 and the Corporate Income Tax Law - ZDDPO-2), and therefore,
  the Ministry of Finance would like to make an assessment of the scope of the issue
  and its financial implications before preparing any response to the proposal received.
  The Slovenian Financial Administration has not yet received this assessment and
  therefore cannot provide any specific information on this matter.'
Text file: 626.txt
Title: The problem of excessive administration in the collection and tax assessment
  of rents for the letting of common areas in multi-apartment buildings
URL: https://www.stopbirokraciji.gov.si/pobuda/?st=626
