The Supreme Arbitration Court of the Russian Federation issued a "verdict" tax case "IKEA Mos". Issue price of 1 billion rubles. The court ruled that all repairs and finishing work done by tenants in shopping centers under the name "Mega", were unreasonably recognized the company's revenues. Accordingly, IKEA will not have to pay taxes on the income and property of their value.
As a reminder, IKEA Mos was presented with an illegal tax claim for 2006-2007 in the amount of 775 million rubles in income tax and 42 and a half million rubles in property tax. The penalty for the entire period amounted to almost 201 million Russian rubles. The main amount of charges was that IKEA deliberately did not include non-sales income the amount produced by the tenants finishing in shopping malls, which built the company. According to the tax office, IKEA deliberately understated their income tax on more than 3 billion rubles., Reducing the average annual value of the property almost 2 billion rubles.
IKEA did not agree with the decision of the tax authorities, losing the main proceedings 3-x hearings. According to the court, IKEA has entered into leases and operating agreement for the property before the completion of the shopping center. Repair works made by the Lessee at its own expense without compensation from IKEA. But, as these works were carried out before the registration of ownership and administration of the shopping center into operation, then, is the Swedish furniture company had to take into account all costs in the form of capital investments in fixed assets. Judicial board agreed with these arguments.
This decision has had a visible impact inspections not only in IKEA, but also to other tenants who pay taxes and regarded their repair costs in the form of capital investment in the leased property. They also filed a claim with the tax authorities, motivated by the fact that tenants were not allowed to take into account the cost of finishing, gratuitously committed for the benefit of the owner of the building. Ltd. "Leroy Merlin East" and LLC "Auchan" who rent space in shopping center "MEGA", until now won tax cases. If IKEA lost, the situation could change dramatically, but the complaint of the company was taken into account, and the panel of judges YOU transferred the case to form a single practice.
According to the Judicial Board triples YOU, the repair of the tenants before the date of entry into operation of the building due to the desire of tenants to open outlets simultaneously with the opening of the shopping center. Moreover, at the time the shops for rent old finish dismantled and the new owner acted finish to suit individual needs. The lack of resolution on putting the building into operation at the time of its transfer to the lessee does not make space lease agreement invalid. Thus, if these costs are recognized in capital investments tenant to the landlord, the tenant is exempt from taking them into account for tax purposes.
Leading Lawyers supported the decision YOU, noting that the decision was made taking into account the practices prevailing in the real estate market, when renters spend finishing facilities in the final stages of construction. At the moment, management IKEA has not commented on the results of the hearing.
