Taxes and fees related to real estate purchases in Northern Cyprus

taxes and fees related to real estate purchases in northern cyprus

26

February

2024

15:50

Contents

    Title Deed Fee

    When you purchase real estate in Northern Cyprus, you are required to pay a title deed fee during the title transfer process. The title deed fee is calculated as a percentage of the sales price of the property excluding VAT. The rate is usually shared between the buyer and the seller, although there is no clear rule on this and it depends on the agreement between the parties.

    VAT (Value Added Tax)

    VAT (Value Added Tax)

    Another cost incurred in real estate purchases is VAT. In Northern Cyprus, the standard VAT rate applicable to newly constructed properties is charged as a percentage of the sales price. VAT is not applicable to second-hand property purchases.

    Stamp Duty

    During the signing of the contract, a stamp duty calculated on the contract value must be paid. Stamp duty is determined as a percentage of the contract value and is usually necessary for the transaction to become official.

    Real Estate Commission

    If you are purchasing real estate through a real estate agent, you will need to pay a real estate commission. This fee is typically calculated as a percentage of the property's sale price and can be shared between the buyer and the seller.

    Municipal Tax

    Property owners are obligated to pay an annual municipal tax for the property they own. This tax varies depending on the location and size of the property.

    Electricity and Water Connection Fees

    Electricity and Water Connection Fees

    When purchasing a new property, you should also consider the connection fees for basic services such as electricity and water. These fees are determined by the institutions providing the services and are usually charged as a fixed fee.

    While purchasing real estate in Northern Cyprus offers many advantages, it is important to understand the financial aspects of the process. The taxes and fees mentioned above can significantly impact the total cost of the transaction. Therefore, before making a real estate investment, carefully evaluate all financial obligations and consider seeking legal or financial advisory services when needed.

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