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Taxes in Northern Cyprus There are four main taxes
involved in any property sale and purchase transaction. The Transfer
Fee which is payable to Land Registry Office Different taxes apply to gifts of property for no consideration and transfers of property between family members. As a general rule, Capital Gains Tax is payable by the vendor and the Transfer Fee and Stamp Duty is payable by the purchaser. Taxes are generally paid on transfer of title. The percentages listed below are calculated as follows: the Transfer Fee is generally paid as a percentage of the assessed value of the property which is carried out just before transfer of title takes place. The VAT, Capital Gains and the Stamp Duty are based on either the assessed value or the contract value, whichever is the highest. Under new regulations, the Tax Office now requires a copy of the contract of sale to be presented to it prior to transfer of title. The percentages levied for each of the three types of tax are shown below: TRANSFER FEE - The transfer fee is 6%. However, every person has a once in a lifetime option to reduce this to 3%. If a purchaser elects to use this option on the purchase, he or she will only pay 3%. Once this option right has been used, the transfer fee payable on all future purchases by that person will be 6%. VAT FOR PROPERTY TRANSACTIONS - 5% of either the assessed value or the sale price. CAPITAL GAINS TAX – The rate will be 3.5% payable by the Vendor. STAMP DUTY – This is 0.5% of the contract price provided this is paid within 1 month of the date of the contract. If it is not paid within this time, the rate increases in stages until after 6 months it becomes 1.5%. FREQUENTLY ASKED
QUESTIONS Will
I have to pay Capital Gains Tax on the sale of my property? If so,
how much will this be? What
if I sell my property before taking title? Will I still have to
pay Capital Gains Tax?
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