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Little progress on Immovable Property Tax debtors

Phileleftheros, the Greek language newspaper, has reported that little progress has been made to collect the €9.6 million Immovable Property Tax plus interest owed by developers and hotels.

Cyprus Immovable Property Tax debtors ACCORDING to information received by Phileleftheros, thirty two land development companies and hotels that owe the state €9.6 million Immovable Property Tax plus interest have paid a mere €215 thousand to date.

The Inland Revenue Department was reported as saying that only 18 of the 32 companies had responded to the Inland Revenue tax notices – and of those 18 only two have paid the full amount owed after errors in their tax assessments were corrected.

The same source reported that the majority of the companies have reached an agreement with the Inland Revenue to pay a proportion of the tax they owe when a property is transacted.

However, these agreements do not prevent the Inland Revenue from taking civil action through the courts to place ‘memos’ on properties owned by the company. Such ‘memos’ will prevent their properties being transacted until their tax debt is paid.

This move by the Inland Revenue Department to place ‘memos’ on properties owned by these companies will further delay the transfer of their titles to their rightful owners, if the companies do not pay their tax obligations promptly.

(We understand that the Inland Revenue has already placed ‘memos’ on properties owned by some of these companies for other unpaid taxes.)

Editor’s note

Where a Court has issued a judgment in favour of a creditor ordering a debtor to pay a specified amount of money to the creditor, the creditor may register a charge with the Department of Lands & Surveys against any immovable property registered in the name of the debtor as security for the recovery of the debt.

The encumbrance created by registering this judgment is known as a “memo” and it effectively prevents the transfer of property owned by the debtor, until such time as the debt has been repaid or the memo removed.

Readers' comments

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  • They should do what the UK Government announced in the budget.

    Anyone owing more that £1,000 in tax can have it taken out of their bank accounts without HMRC first having to obtain a court order.

    (It would also ease the load on the curts).

  • JAY says:

    Does a “memo” by inland revenue take precedence over a sale contract that is registered? if the developer pays the IPT for that particular project but not for the rest of their other projects, then can the deeds be issued for the project on which the IPT is paid. I have a feeling I am never going to see my deeds. Advice to all – Rent in Cyprus and Buy in UK unless you are very savvy which I finally realized I am not.

  • Frank says:

    @MartynG

    Where have all my euros gone?

  • Mike says:

    And so the corrupt, nepotistic practices continue and who do you think will end up being made to pay?

  • Peter Davis says:

    To big to fail?

    To important to chase with friends in high places?

    Go for the small boys and the easy static targets. Go for the poor suckers who have paid for their property and then use taxpayers money to write off the debt.

    Isn’t this what they’re hoping for that the debts will be reduced or written off.

  • MartynG says:

    OUTRAGEOUS is the only word that comes to mind. Who, in their ‘right mind’, knowing all this, is going to seriously even think about buying a Deed-less property from any of these Developers. The ignorant and the innocent have been deceived for decades, it seems, by the ‘Cyprus system’ and practices. Another death knell for the already sick and corrupt Cyprus property system! ‘When will they ever learn’? To use the key words from the long-time ago Seeger song.

  • The views expressed in readers' comments are not necessarily shared by the Cyprus Property News.

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