Tax on Property Sale

[gary&shirley]

Hi All, We are currently selling an apartment which we wish to pay the sales tax on before switching the Kocan to the new owner, we are aware that you have a one off exemption however wish to keep this for the sale of our current property which is valued more. Do you just go to the tax office with the sales contract, or does it involve another process ? Thanks in advance for any replies.

[13roman58]

You can pay it when you transfer the kocan I think it is 1/2 percent

[Keithcaley]

Hi All, We are currently selling an apartment which we wish to pay the sales tax on before switching the Kocan to the new owner, we are aware that you have a one off exemption however wish to keep this for the sale of our current property which is valued more. Do you just go to the tax office with the sales contract, or does it involve another process ? Thanks in advance for any replies.

I'm not sure what you are referring to when you say 'Sales Tax' - the various Taxes and fees applicable to property transactions in TRNC are: -

ƒ The Transfer Fee (Devir Harçları) which is payable to Land Registry Office
ƒ The Capital Gains Tax (Stopaj) which is payable to the Tax Office
ƒ The VAT (KDV) which is payable to the Tax Office or to the Vendor
ƒ The Stamp Duty (Pul Parası) which is payable to the Tax Office

Information gleaned from Naomi Mehmet's website, where you will find further, informed, advice.

[Reyntj]

My experience is that if the buyer is not immediately taking title ie a non citizen and they are just registering a contract the tax is not triggered until the actual kocan is transferred . What normally happens is the vendor will deduct the tax from the sales price so when the new buyers have their ptp they pay the vendors tax .

There is no tax due until kocan is transferred just registering a contract is not a taxable event for a seller.

You will need to ensure your contract includes the fact that the buyer is now liable to pay the sellers tax . From memory i believe the tax is due on the valuation and is 3 % . The land registry will give you a valuation . The value might go up by the time your buyer gets the ptp etc but any increase in tax is fir them to cover and should be relatively small.

Im not 100 % on how much the tax is im just giving you my opinion as it is in y head ! But i have bought quite a few properties here . I definately remember buying one like this where they rebated me the tax and i have to pay it when i take title and it was around 3 % of the valuation . I havent took the title yet so i cant confirm exactly what it is and if its based on sale price or current or past valuation . I hope this help .

[Reyntj]

http://www.erdalco.com/wp-content/uploa ... 016ENG.pdf

Section d . This could be correct ....20. % of higher of val or sales price . Then 30 % deduction then pay pay 20 % . So in a 100 k thats 20 k profit less 30 % deduction leaves 14 k ...20 % of this £2800 .... maybe ....

[13roman58]

Sales tax is half of one percent for private sales

[Reyntj]

http://www.gurkanandgurkan.com/library/ ... ctions.doc They say the cgt is 3.5 % .

The only tax i know which is 0.5 % ie to register a contact. I think thats what you are getting mixed up with . The cgt tax is definayely not 0.5 % . I register contracts regularly as im a landlord and its the same for other times i have registered a sales contract . Its not cgt as paid by the seller thev0.5 % is paid by the buyer to register a contract sometimes referred to the sales contract .

[ozankoys]

What a load of confusing uninformed answers! The Stoppaj (Sales Tax) is due & paid on the day of transfer into the Purchaser's name. It is approximately 4% of the Valuation sum given by the Tapu (Land Registry) not necessarily the contract value.
The forms need to be submitted to the Tapu for valuation which takes about 3 days, the Valuation is then valid for 3 weeks if you do not transfer within this time you have to apply again.
If Purchaser is TC the transfer can happen in a morning, if PTP has to be applied for it is normal for a retention of the estimated Sales Tax be lodged with a third party for a specified time period then once this is paid the balance refunded to the Vendor. In the event of a time elapse between actual sale & transfer the Vendor should state a limit as to how much they will pay in case of a higher valuation or higher %.
You have to tell the Tax Office if you want to use your one off Stoppaj exemption then they will prepare a document to be taken to the Tapu so that the sale can be tax free.

[gary&shirley]

Many Thanks ozankoys, that sounds more like I was expecting.

[PapaBravo]

Thanks ozankoys; clear and succint.

[Reyntj]

Well you have said exactly what i have said ozankoy so you must be uninformed as well!

[Reyntj]

In fact your post is more confusing than the information than i posted ... its approximately 4 % ? Of the valuation not nevcesarily the sales price .....thats clear then er not ....which is it then as its clearly as clear as mud from your post . Approximately 4 % thats informed is it ? At least i posted some clear reference from trnc tax accountans and an advocat ...and you habe the guile to proclaim my posts unimformed whilst post approximates and ambiguities . I habe bought 10 properties here in cyprus so im not totally uninformed . I already made it clear the that the tax wasnt due until the contract was transfered. The trnc lawyer i posted above gurkan and gurkan ate clearly stating 3.5 % of the higher of sales or valuation price . Thats not approximately 4 % is it ......

[Keithcaley]

Fight! Fight!

Call a teacher, somebody!

[Reyntj]

No need for a fight a simple apology from ozankoy can be accepted

http://www.gurkanandgurkan.com/library/ ... ctions.doc

i have posted the link again from the informed solicitor who clearly state the cgt is 3.5 % of the higher of the sales price or the valuation . I trust that informs the uninformed and also any uninformed know it alls .

[Keithcaley]

No need for a fight a simple apology from ozankoy can be accepted

http://www.gurkanandgurkan.com/library/ ... ctions.doc

i have posted the link again from the informed solicitor who clearly state the cgt is 3.5 % of the higher of the sales price or the valuation . I trust that informs the uninformed and also any uninformed know it alls .

I wouldn't be quite so sure...

If you examine the document to which you have posted a link, you will find that it is over 12 years out of date!

Not only that, but the document was written by Naomi Mehmet, and appears to have been copied by someone called Ali Tüzel in Gurkan and Gurkan's office.

See here: -

I would be much more inclined to trust the document that I posted a link to on Naomi Mehmet's website (my post, number 3 of this thread) which states 2.8%, although to be fair, if you look on half a dozen Avukat's websites you could easily find six different rates!

Fascinating, isn't it?

[gary&shirley]

I am very sorry if this issue has caused some bad feeling, it was never posted to do so, I have since received information from my lawyer that I will be responsible for paying 2.8% of the valuation at the time of transfer, if the buyer does not have PTP in place then I am responsible for leaving a sufficient amount to pay the tax with a 3rd party in my case my lawyer and before more arguments ensue Mr Akil is a UK qualified lawyer not a TRNC Advocate.

[Reyntj]

It hasnt caused any bad feeling . I concur with the 2.8 % as per my calculation from the tax guide by eraldco in message 5. But that seems to have been ignored but i did post the exact calculation on 100 k . In my firs post i said i though it was 3 % but wasnt exactly sure so went off and did research as i knew i had the tax guide . Which confirms exactly how the 2.8 % was arrived at . Clearly as pointed out the 3.5 % is out of date and i should yabe checked . What i took offence to was i was only trying to help and i took the time to go and research to clarify what i had said .Then some smart arse comes and long with incorrect info and says am unimformed which was uncalled for . They could and have just said whatbtheynthought instead of rubbishing other peoples info . Next time i wont bother

[kerry 6138]

To be fair garyandshirley's original post was about how to apply for the exemption they never asked for figures % or otherwise which seemed to get lost with subsequent posts

[Keithcaley]

To be fair garyandshirley's original post was about how to apply for the exemption they never asked for figures % or otherwise which seemed to get lost with subsequent posts

You're not wrong!