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Cyprus property tax change

Changes to property law on Cyprus that take effect this month December 2011 means that fees will be reduced on property transfers for the next six months.

In a move aimed at stimulating sales on the beautiful Mediterranean island the reduction will only apply to the first sale of a property where the contract is dated and deposited within the period.

It means that those who pay VAT on their house purchase will now not be liable for transfer fees and for those who do not pay VAT on their purchase, property transfer fees will be reduced by 50%, as long as they are within this window of opportunity.

This should inject some life into the Cyprus property market as our buyers have been waiting in the wings for this law ever since it was first heard about, they should now be happy to purchase during the next six months.

There are also provisions in the law to prevent abuse of the tax break and to stop buyers withdrawing contracts of sale deposited at the Land Registry and then altering dates before re-submitting.

Property Transfer Fees are based on the Land Registry’s assessment of the market value of a property at its date of purchase. However, using its discretion to reassess the amount of Transfer Fees payable, the Land Registry relies on its own historical data in a way that cancels out any transfer tax benefit of a bargain buy, which can result in double the expected amount being levied.

Property prices in Cyprus have been muted in 2011 with the Royal Institution of Chartered Surveyors Cyprus Property Index showing that foreign buyers in particular have deserted the market. This led to a low number of transactions and in turn resulted in fewer local people entering the market, but on the positive side, this has produced many bargain buys that will be snapped up very quickly now to use this window of opportunity.

Thinking about buying, now is the time for you to arrange your itinery to view a portfolio of very special bargain properties.

Contact us today then settle back for us to glide you through the process.

See more news about this here Cyprus Property Tax Changes

Cyprus Property vat News

VAT reductions for first-time home buyers and a suspension of transfer fees are being discussed as part of the Cyprus government’s austerity measures to bolster the Island’s failing economy

GOVERNMENT lobbying by the Land & Building Developers Association (CLBDA) and the Land & Property Owners Association (KSIA) has been successful as proposals to reduce the tax on properties are now being discussed

The tax reduction proposals comprise:

Reducing the VAT to 5% for first-time home buyers for residences up to 250 square meters – and maintaining it at 15% for residences between 250 and 300 square metres. A suspension of property transfer fees for a three year period. A draft law concerning the reduction in VAT to 5% is expected to be discussed at today’s House Plenary session.

The Island’s property market has been in trouble for quite some time. Sales have fallen for thirteen consecutive months and are now down by almost 20% on the numbers sold last year. Unemployment in the sector has risen and the business climate deteriorated.

Assuming that these proposals are accepted by parliament and become law, they should go a long way in relieving the problems of the industry and should also help to clear the backlog of Title Deeds waiting to be issued.

Need a lawyer in Cyprus

 
If you are serious about buying a property for sale in Cyprus, you will want to make sure that you have a Cyprus property lawyer who you can trust from exprienced recomendations.
 
This is the only person who can effectively protect your interests and guide you through all the requirements of purchasing property in Cyprus.  You need someone who is unbiased and is only serving you, not the other party in the transaction.
 
Make full use of this professional and don’t hesitate to ask questions. The lawyer should ensure that the property purchase is clear from mortgages or ties etc,  with no unpaid debts attached to the estate. Furthermore, don’t sign any contracts or hand over any money until the action has been approved by the lawyer.
 
Once you do locate a suitable piece of real estate, there is another process. As a foreigner, you will have to apply for permission to buy the property but this is usually just a formality and  your lawyer can help you through the process.
 
We know and trust a lawyer so contact us for further assistance.
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