BGP Litigation associate Natalia Yurchenkova speaks with Interfax about a dispute between a tax inspectorate and taxpayer over the sale of real estate at allegedly knock-down prices

"The company in the case, which uses the simplified system of taxation, sold real estate for about 23 million roubles, but the price (approximately 700 roubles per square metre) differed from the market price by 78-769%. This was confirmed by an expert determination, but in court it was found that the tax inspectorate failed to properly follow the procedure for ordering an appraisal of its market value, said Natalia Yurchenkova, a lawyer at BGP Litigation.

The decision has positive implications for taxpayers: tax inspectors don't have the right to levy additional tax if the price of a transaction differs from the market price, said N. Yurchenkova. "In court, counsel for the tax inspectorate argued that the fact a price differs greatly from the market price is a reason for the prices to be reviewed, including prior to 2012, as the company may have obtained an unjustified benefit. In other words, they are taking the line that it isn't price control, but an unjustified benefit. Previously such arguments have been raised successfully by tax inspectors, but not this time", she said". 

The full article (in Russian) is available here: "Верховный суд признал нарушения налоговиков в споре о цене продажи недвижимости".