Ukraine, the second largest country in East Europe, with an area of 603,628 kilometers, is bordered by the Russian federations on the north-eastern and eastern sides, Hungary, Slovakia and Poland on the western side, Belarus on the north-west and Moldova and Romania on the south-western side. A large number of international real estate investors are aware of the rapid development of Ukraine Real Estate.
ASSET PROTECTION Most real estate activity involves some risk taking. If you are buying and improving houses or buildings for resale, you will be using contractors and other parties to help with the improvements. There will be contracts signed and potential for accidents and disputes that arise out of the business activity. If you are a landlord, there is significant risk as you will have a tenant- someone living in a unit that you own.
When you take into account the fact that your business is also holding property that is of potentially significant value, there is a lot to lose if a dispute or accident occurs or a lawsuit is filed. Because of the risk profile, it is imperative that all profit generating activity be operated through an asset protection entity. There are two main choices- the limited liability company and the corporation.
Obtaining in Ukraine is quite simple and convenient. The appreciation of property rates started during early 90s after the economy of Ukraine hit rock bottom and was more prominent in larger cities like Kiev, Lviv, Odessa and Dnepropetrovsk. Following this, the prices of the resort areas in Crimea began escalating.
TAXATION What you pay in taxes makes a real difference to the bottom line of any business. Accordingly, you will want to minimize taxes and any potential for paying more to the government as much as possible.
The “opportunity cost” of deciding to tie your money up in an investment like this is also a factor investors should consider. You are potentially losing out on investing your money elsewhere by having and maintaining this property. It would be best to consider this before you choose to invest.
You will find that the capitalization rate is one very useful tool by which to determine the potential investment income over a period of a specific duration. By adding in the original property cost, it is customizable and also based on real-world fiscal figures.
SUMMARY Because of both the tax and liability consequences and the fact that business owners and investors can run and manage a limited liability company with very little formalities and paperwork, the real estate LLC is the best property and business vehicle for holding real property such as land, houses and buildings and for conducting rehabs, improvements, development and rental activity.