Purchasing a piece of property is an enormous endeavour, one that requires careful planning and expert assistance. At Askanis Group, our team of professionals and associates are on hand to assist you, every step of the way. Read below for some useful background on the most important Legal and Financial aspects of purchasing a piece of property in Cyprus.
Department of Land Registry
Property in Cyprus is registered on a land registry like that of the United Kingdom. The Land Registry system in Cyprus has been continually updated and modernised to make it one of the most efficient and sophisticated land registry systems in the world. Property purchasing in Cyprus is therefore a very straightforward and simple procedure.
Property duties and other costs
In case of a sales contract, the purchaser is liable for the payment of stamp duty at the rate of 0.15% on the first €170.000, and 0.20% above this threshold. The duties and fees are payable when the Contract of Sale is stamped at the Tax Department prior to its deposition to the Land Registry.
Transfer of title deed permission
EU citizens that are permanent residents in Cyprus do not require permission to transfer any immovable property on their names. Non-Cypriot, non-EU citizens do however require permission to transfer property from the Council of Ministers. Application to the Council of Ministers can be submitted by the third country national purchaser within a reasonable period after the Contract of Sale has been signed. Permission is usually granted as a matter of course to all bona fide purchasers within two months. During this process purchasers may take possession of their property without restriction.
Upon transfer of the property and registration in the purchaser’s name, the district Land Registry Office will charge transfer fees, which are based on the market value of the property at the time of the purchase and are calculated as follows:
- 3% on the first €85.430
- 5% from €85.430 - €170.860
- 8% €170.000 +
Note: For properties owned jointly by a couple, transfer fees are charged on 50% of the property value for each, providing an advantage for any property value exceeding €85.430.
Note: Properties purchased after the 2nd of December 2011, which are subject to VAT will be exempt from the above transfer fees. Properties not subject to VAT will be eligible for a 50% exemption from the above transfer fees.
VAT payable on property
VAT in Cyprus is currently 19%.Clients can also apply for 5% VAT on the purchase of a residential house by providing the following information and documents:
- Original copy of the application for town planning or building permit, true copy of the original;
- Copy of the town planning or building permit, true copy of the original;
- Purchase agreement or contract to build the property duly stamped (€1,71 stamped);
- Other documentary evidence regarding the purchase or building of the property such as deposit receipts, application for/granting of loan, invoice corresponding to receipts for payments;
- Registration certificate for building land (in case the town planning or building permits were issued to persons other than the beneficiary), if applicable;
- Written certification by the project surveyor of the total covered area of the property (find attached the form to be completed);
- Affirmation of the contractor or the contracting company that the annual contracting permit for the equivalent grade of work is held (find attached the form to be complete);
- Certificate from Council for the Registration and Control of Building and Civil Engineering Works (ΕΤΕΚ) to confirm ownership of the annual license contractor during the construction period of the project;
- Architectural drawings (elevations, floor plans) approved and stamped by the competent authority in scale 1:100;
- A plan with the total area of the property;
- Copy of beneficiaries’ identity cards/passports;
- Copy of marriage certificate for married persons;
- Within 6 months from the date of first occupation, the beneficiary must present evidence that the property is used as the main place of residence. Such evidence includes: copies of phone, water and electricity bills, municipal or city council rates or similar evidence proving that the property is used by the beneficiary as a permanent place of residence. These documents will be requested later by the VAT Authorities;
- The application form must be signed by the beneficiary and his/her spouse in case of married persons.
For more information please contact us on [email protected] or call us on +357 25 336 171.