FURTHER details have emerged of the eagerly anticipated reduction in Property Transfer Fees, which are paid by the purchaser and become payable whenever a property in Cyprus changes hands and are the Cyprus equivalent of the Stamp Duty Land Tax (SDLT) payable in the UK.
The key features of the legislation are as follows:
For transfers that take place before the 31st December 2016:
(a) If VAT was paid on the property, no Property Transfer Fees are payable.
(b) IF VAT was not paid on the property, the Property Transfer Fees are reduced by 50%.
However if the Director of the Land Registry considers that the price stated on the contract of sale does not reflect the market value of the property at its date of purchase he may, at his discretion, charge the full Property Transfer Fees based on the market value of the property at its date of sale less the price stated on the contract of sale.
In addition, where a property is transferred from parent to child, Property Transfer Fees have been abolished.
Those who have or will purchase property between December 2, 2011 and December 31, 2016 will benefit from the reduced Property Transfer Fees regardless of when the transfer takes place. (Article Transfer fee abolition/reduction law published at last! refers.)
The law make no mention of a refund to those who have already paid their Property Transfer Fees.
However, in a statement he made last year, the Interior Minister was reported as saying that there was no point in putting off transferring the deeds as any reduction would have retroactive effect if it is decided and that amounts commensurate with the reduction will be returned to all impacted parties.
Consolidated Land Registry Fees Law (English)