Purchase of real estate in Ukraine by a non-resident: apartments, houses, commercial real estate
Ukraine, with its dynamic real estate market and attractive investment opportunities, is increasingly attracting the attention of foreign investors. Non-residents wishing to purchase an apartment, house or commercial real estate in Ukraine face a number of legal, tax and practical issues. In this article, we will consider in detail the process of purchasing real estate by a non-resident, the main legal aspects, document requirements, taxation, as well as risks and ways to avoid them. INSEININ law firm offers professional support at all stages of this process to make your investment safe and effective.
Who is considered a non-resident in Ukraine?
According to Ukrainian legislation, a non-resident is an individual or legal entity that does not have a permanent place of residence or registration in Ukraine. These may include:
Foreign citizens residing outside Ukraine;
Citizens of Ukraine permanently residing abroad;
Foreign companies or organizations registered in other countries.
Non-residents have the right to purchase real estate in Ukraine, but this process has its own characteristics, which we will consider below.
Legal basis for purchasing real estate by a non-resident
Purchasing real estate in Ukraine is regulated by a number of regulatory legal acts, in particular:
Foreign citizens residing outside Ukraine;
Citizens of Ukraine permanently residing abroad;
Foreign companies or organizations registered in other countries.
Non-residents have the right to purchase real estate in Ukraine, but this process has its own characteristics, which we will consider below.
Legal basis for purchasing real estate by a non-resident
Purchasing real estate in Ukraine is regulated by a number of regulatory legal acts, in particular:
- The Civil Code of Ukraine - defines the general rules for concluding purchase and sale agreements.
- The Land Code of Ukraine - regulates issues related to land plots that may be part of the transaction (for example, when buying a house).
- The Law of Ukraine "On the Legal Regime of Foreigners and Stateless Persons" - establishes the rights and obligations of foreigners in the field of property relations.
- The Tax Code of Ukraine - regulates the taxation of real estate transactions.
Stages of buying real estate by a non-resident
1. Choosing a real estate object
The first step is choosing a real estate object. Non-residents are recommended to contact reliable legal consultants who will help check the object for legal purity. INSEININ law firm provides services for analyzing real estate documents to make sure that the object does not have encumbrances, arrests or other legal problems.
2. Obtaining an identification code
To conclude a purchase and sale agreement, a non-resident must obtain an individual tax number (TIN) in Ukraine. This code is issued by the State Tax Service of Ukraine. To obtain it, you must submit:
Application in form No. 1-TIN;
A copy of your passport (with a notarized translation into Ukrainian);
A document confirming your place of residence abroad (if necessary).
INSEININ lawyers will help you quickly obtain a TIN, reducing the time spent on bureaucratic procedures.
3. Checking the legal purity of the object
Before signing the contract, it is necessary to check:
The seller's ownership right - in the State Register of Real Property Rights.
The presence of encumbrances - arrests, mortgages, litigation.
Technical documentation - for houses or commercial real estate, including land plots.
This stage is critically important, since non-residents may not know all the nuances of Ukrainian legislation. INSEININ provides a full check of the object to avoid the risks of losing money.
4. Conclusion of a preliminary agreement
In many cases, the parties conclude a preliminary purchase and sale agreement, which records the intention of the parties to conclude a main agreement in the future. The preliminary agreement specifies:
Characteristics of the real estate object;
Price and payment procedure;
Terms of conclusion of the main agreement.
A preliminary agreement is usually accompanied by a deposit. INSEININ lawyers will help to correctly draw up an agreement to protect the interests of the buyer.
The first step is choosing a real estate object. Non-residents are recommended to contact reliable legal consultants who will help check the object for legal purity. INSEININ law firm provides services for analyzing real estate documents to make sure that the object does not have encumbrances, arrests or other legal problems.
2. Obtaining an identification code
To conclude a purchase and sale agreement, a non-resident must obtain an individual tax number (TIN) in Ukraine. This code is issued by the State Tax Service of Ukraine. To obtain it, you must submit:
Application in form No. 1-TIN;
A copy of your passport (with a notarized translation into Ukrainian);
A document confirming your place of residence abroad (if necessary).
INSEININ lawyers will help you quickly obtain a TIN, reducing the time spent on bureaucratic procedures.
3. Checking the legal purity of the object
Before signing the contract, it is necessary to check:
The seller's ownership right - in the State Register of Real Property Rights.
The presence of encumbrances - arrests, mortgages, litigation.
Technical documentation - for houses or commercial real estate, including land plots.
This stage is critically important, since non-residents may not know all the nuances of Ukrainian legislation. INSEININ provides a full check of the object to avoid the risks of losing money.
4. Conclusion of a preliminary agreement
In many cases, the parties conclude a preliminary purchase and sale agreement, which records the intention of the parties to conclude a main agreement in the future. The preliminary agreement specifies:
Characteristics of the real estate object;
Price and payment procedure;
Terms of conclusion of the main agreement.
A preliminary agreement is usually accompanied by a deposit. INSEININ lawyers will help to correctly draw up an agreement to protect the interests of the buyer.
5. Signing the main contract
The main contract of sale is concluded in notarial form. The notary checks the documents of the parties, the legality of the transaction and registers the transfer of ownership in the State Register of Property Rights. To sign the contract, a non-resident must provide:
Passport (with a notarized translation);
TIN;
Documents confirming the source of origin of funds (if necessary, in accordance with the requirements of financial monitoring).
6. Payment and transfer of ownership
Payment for real estate is usually made via bank transfer. Non-residents must take into account the requirements of the currency legislation of Ukraine, in particular regarding the transfer of funds from abroad. After payment and signing the contract, the notary registers the ownership of the new owner.
Taxation when purchasing real estate
Non-residents are subject to taxation when purchasing real estate in Ukraine. Main taxes and fees:
Personal income tax (PIT):
For non-residents, the rate is up to 18% of the seller's income (if the seller is an individual).
PIT is paid by the seller, but the parties can agree on the distribution of this obligation.
Military duty:
The rate is up to 5% of the value of the object.
Paid by the seller together with PIT.
State duty:
Is 1% of the value of the property specified in the contract.
Paid by the buyer.
Notary services:
The cost depends on the notary's tariffs, but usually ranges from 0.5% to 1% of the transaction amount.
VAT (for commercial real estate):
If the seller is a legal entity that is a VAT payer, VAT (20%) may be added to the value of the property.
INSEININ law firm will help optimize taxation and verify the correctness of tax calculation.
The main contract of sale is concluded in notarial form. The notary checks the documents of the parties, the legality of the transaction and registers the transfer of ownership in the State Register of Property Rights. To sign the contract, a non-resident must provide:
Passport (with a notarized translation);
TIN;
Documents confirming the source of origin of funds (if necessary, in accordance with the requirements of financial monitoring).
6. Payment and transfer of ownership
Payment for real estate is usually made via bank transfer. Non-residents must take into account the requirements of the currency legislation of Ukraine, in particular regarding the transfer of funds from abroad. After payment and signing the contract, the notary registers the ownership of the new owner.
Taxation when purchasing real estate
Non-residents are subject to taxation when purchasing real estate in Ukraine. Main taxes and fees:
Personal income tax (PIT):
For non-residents, the rate is up to 18% of the seller's income (if the seller is an individual).
PIT is paid by the seller, but the parties can agree on the distribution of this obligation.
Military duty:
The rate is up to 5% of the value of the object.
Paid by the seller together with PIT.
State duty:
Is 1% of the value of the property specified in the contract.
Paid by the buyer.
Notary services:
The cost depends on the notary's tariffs, but usually ranges from 0.5% to 1% of the transaction amount.
VAT (for commercial real estate):
If the seller is a legal entity that is a VAT payer, VAT (20%) may be added to the value of the property.
INSEININ law firm will help optimize taxation and verify the correctness of tax calculation.
Features of buying different types of real estate
1. Buying an apartment
Apartments are the most common object for investment among non-residents in Ukraine. Key points:
Verifying ownership rights in an apartment building.
Analysis of documents for an apartment (technical passport, absence of debts for utility services).
The possibility of obtaining a mortgage (if there are banking programs for non-residents).
2. Buying a house
Buying a house is often associated with a land plot, which adds complexity. Non-residents need to consider:
Registering a land plot for rent (since direct purchase of agricultural land is prohibited).
Checking the boundaries of the plot and its intended purpose.
Technical documentation for the house (availability of building permits).
3. Buying commercial real estate
Commercial real estate (offices, warehouses, retail premises) attracts investors due to its potential profitability. Features:
Verification of the intended purpose of the object.
Analysis of lease agreements (if the object is already leased).
Additional requirements for financial monitoring for large investments.
Risks and how to avoid them
Purchasing real estate by a non-resident is associated with certain risks, in particular:
Legal risks:
Illegal registration of ownership by the seller.
Hidden encumbrances (seizures, mortgages).
Solution: Involvement of INSEININ lawyers to check documents and support the transaction.
Financial risks:
Opaque payment schemes.
Financial monitoring requirements regarding the source of funds.
Solution: Use of bank transfers through reliable banks and consultation with lawyers.
Currency restrictions:
Difficulties with transferring large amounts from abroad.
Solution: Preliminary consultation with the bank and lawyers regarding currency regulation.
Apartments are the most common object for investment among non-residents in Ukraine. Key points:
Verifying ownership rights in an apartment building.
Analysis of documents for an apartment (technical passport, absence of debts for utility services).
The possibility of obtaining a mortgage (if there are banking programs for non-residents).
2. Buying a house
Buying a house is often associated with a land plot, which adds complexity. Non-residents need to consider:
Registering a land plot for rent (since direct purchase of agricultural land is prohibited).
Checking the boundaries of the plot and its intended purpose.
Technical documentation for the house (availability of building permits).
3. Buying commercial real estate
Commercial real estate (offices, warehouses, retail premises) attracts investors due to its potential profitability. Features:
Verification of the intended purpose of the object.
Analysis of lease agreements (if the object is already leased).
Additional requirements for financial monitoring for large investments.
Risks and how to avoid them
Purchasing real estate by a non-resident is associated with certain risks, in particular:
Legal risks:
Illegal registration of ownership by the seller.
Hidden encumbrances (seizures, mortgages).
Solution: Involvement of INSEININ lawyers to check documents and support the transaction.
Financial risks:
Opaque payment schemes.
Financial monitoring requirements regarding the source of funds.
Solution: Use of bank transfers through reliable banks and consultation with lawyers.
Currency restrictions:
Difficulties with transferring large amounts from abroad.
Solution: Preliminary consultation with the bank and lawyers regarding currency regulation.
Why should you contact INSEININ?
INSEININ law firm has many years of experience in supporting real estate transactions for non-residents. We offer:
- Full legal support - from inspection of the property to registration of ownership.
- Document preparation - assistance with obtaining a TIN, document translation, preparation of contracts.
- Tax consultations - optimization of tax obligations.
- Protection of the client's interests - minimizing risks and ensuring transparency of the transaction.
Conclusion
Purchasing real estate in Ukraine by a non-resident is a promising investment, but it requires careful preparation and knowledge of Ukrainian legislation. From choosing a property to signing a contract and registering ownership - each stage has its own characteristics. INSEININ law firm is ready to become your reliable partner to make the process of purchasing real estate simple, safe and profitable. Contact us for professional assistance, and we will ensure the successful completion of your transaction!
📞 For legal consultation on these matters, contact us at: +380 97 507 06 53 or +380 93 228 01 24
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