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Acquisition of property in Cyprus


Under the Immovable Property Acquisition (Aliens) Law Cap 109 permission must be sought from the Council of Ministers for any non-Cypriot person before they may purchase property in Cyprus. Permission has to be granted for the purchase of freehold and on leases of 33 years or more. Application must be made in writing and is normally straight forward with permission being granted to alien individuals who meet the normal requirements. This permission enables non-Cypriots in purchasing property or land. The maximum amount of land an alien is allowed to purchase is 2 donums. This permission is granted for personal use. The requirements for commercial usage is completely different and is dealt with separately.

 

Disposal of property in Cyprus

 

There are no restrictions for an alien being able to sell their property or dispose of it by Will once permission has been granted from the Council Of Ministers and the property has been transferred into their name. Also, a legal heir to a property is not required to seek permission to have the property transferred into their name.

 

Contracts for sale or lease

 

All Law contracts must be in writing as per the law in Cyprus. Within two months of the signing of the Contracts of sale they should be submitted to the appropriate District Lands Office. This ensures that in the event of any breach the purchasers right to pursue the remedy of specific performance is protected.

 

 Transfer of title

 

Once permission has been granted and the importation of foreign funds has been certified by the Central Bank transfer of title can take place. The purchaser is responsible for the payment of the transfer fees based on the sale price.

 

Payment - Exchange control

 

The Approval of the Central Bank is required for the purpose of transferring of property to non-Cypriots. For this approval to be granted the applicant must prove that the purchase funds have been imported into Cyprus. Permission to remit these funds out of Cyprus in the event of a subsequent sale of the property will not be granted without this approval.

 

Capital gains tax

 

Capital gains tax is at the rate of 20% on gains of more than CYP10,000 arising from the disposal of property by individuals.

 

Property tax

 

An annual amount of CYP2.00 per thousand of the market value of the property is payable with the first CYP100,000 being exempt.

 

Estate duty

 

Estate duty has been abolished in Cyprus.

 

Other expenses  

 

a.  Water rates and electricity are charged on consumption.

 

b.  The costs for Refuse Collection vary between CYP50 to CYP100 per year

 

c.  Municipality of village rates are minimal and are approximately CYP50 p.a.

 

d. Common maintenance charges are applicable in apartment blocks or multiple complexes. This charge covers such things as lighting, staircases, lifts and swimming pools etc. It is advisable to ask the developer of this cost before any agreements are made.

 

 

Buying property in Turkish Occupied Northern Cyprus

 

The non-recognition of the "Turkish Republic of Northern Cyprus" and the possibility of a future political settlement in Cyprus could have implications for those considering buying property in the north. Before purchasing a property you are advised to seek legal advice.   Courtesy of http://www.fco.gov.uk

 

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Revised: March 19, 2008