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April 21, 2015
If you are interested in buying or renting a property and you find yourself concerned about how much tax you will have to pay or wondering whether you even have to pay it, please be sure to read the following article. Not only will it answer the abovementioned questions, but with the following guide you could potentially save money and make sure that with every step that you go forward, you do so in accordance with the law.
Find out when VAT is charged in real estate operations, how to avoid it and which formal obligations you must fulfill.
The purchase of a new home, or a home that has never been previously occupied, is subject to VAT at the current rate of 10%, except for officially protected dwellings (VPOs), which are taxed at 4%. The Tax Office determines that the “first purchase” of housing occurs when one buys directly from the developer when the construction is completed. The purchase of used housing (re-sale of property) is subject to Property Transfer Tax (PTT), because it is exempt from VAT.
How the waiver is made:
The waiver is made by the seller and, in order for it to be valid, there are certain requirements. Should you wish to know more about these, please contact us directly and we would be more than happy to answer any of your queries on this matter.
For VAT purposes, lessors of property are considered businessmen or professionals. The activity of leasing a property is subject to VAT, but there is an exemption in certain cases. The following are the most common:
Lexland Lawyers has a team of experts in this field who would be happy to advise you, ensuring that your commercial or private operations are carried out in the most tax efficient manner.