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Cypriot Passport Acquisition and Permanent Residence Permit
Repossession Property Yield Properties

Latest news

  • 1 August 2018 Cyprus construction industry enjoying a revival

    Cyprus’ construction industry seems to be regaining confidence over the... read more

  • 23 July 2018 Signing of an agreement for the creation of satellite Casino at Larnaka international airport

    The Hermes Airports Ltd and the Integrated Casino Resorts Consortium Cyprus... read more

  • 17 July 2018 Larnaca Tower plans progressing

    It looks as if a high-rise development ‘Larnaca Tower’ will soon get... read more

  • 16 July 2018 Andreas Byras Mayor of Larnaca interview in Politis newspaper

    "There will be pressure. Neither with the issue of the harbor, nor with the... read more

  • 10 July 2018 Hellenic Bank Step towards the conclusion of the agreement

    The decision of the House of Representatives yesterday is still a decisive... read more

VAT break for young couples buying land for first home

   

THE GOVERNMENT has submitted a draft bill to parliament indirectly exempting from payment of 19 per cent VAT young couples who buy land for the purpose of building a primary residence. The issue is related to the passage of a law last November imposing 19 per cent VAT on building land.

In its wake, persons buying a finished housing unit or apartment as their primary dwelling must pay 5 per cent VAT, whereas purchasing a plot of land for owner-occupied housing incurs a 19 per cent VAT charge. Now, the new bill provides that, whereas newlyweds buying land for owner-occupied housing will pay the full tax rate, 14 per cent of the VAT imposed on the value of the land would be returned to them in the form of a grant so that ultimately, they only pay 5 per cent VAT. Lawmakers meanwhile have tabled a legislative proposal aiming to eliminate a distortion where certain buyers of real estate must pay property transfer fees while others do not. The bill was tabled by Disy MP Averof Neophytou. When a person buys a new property in Cyprus and pays VAT on it, he or she is not subject to transfer fees, whereas transfer fees do apply when the transaction involves a land lease. To end the distortion in the market, the proposal provides for the non-payment of transfer fees for rentals or leases of immovable property when the persons involved already pay VAT on taxable business activity.

But not all MPs are on board with the proposal, which was discussed during a closed-doors session of the House finance committee. The Greens’ George Perdikis said his party would never consent to an arrangement letting developers “off the hook.” Whereas the lease option might benefit entrepreneurship – by eliminating transfer fees – this should not be done at the expense of state revenues, he said. “There is a large discussion going on about leases in which the church is involved, and we shall under no circumstances agree to the state taking a hit in order to serve the interests of a businessman, whoever he or she may be.” After the VAT on building land was passed late last year, parliament brought regulations specifying which type of development would be subject to the tax. Protected zones and farming land were exempted.

Read more at: http://www.news.cyprus-property-buyers.com/2018/04/17/vat-break-for-young-couples-buying-land-first-home/id=00154060
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