When purchasing your property, it is essential that you thoroughly carry out checks on your proposed investment. A registered advocate is able to make the relevant applications in order to obtain a search certificate on a property. A search will specify:
The name(s) of the registered owner;
if there are any liens, charges or 3rd party claims on the property;
the share of the property (individual, shared or site deed with communal share);
the category of tile, ie whether it is Turkish, exchange or other;
the nature of the property ie house, land, half-built dwelling on site etc.
As most of the above are subject to change, it is essential that you obtain a search at the time of purchase. An older search certificate may reflect an entirely different position of the property. Many reputable agents are able to safely guide you with full transparency and disclosure towards buying your dream home.
Applying for your PTP
In order to obtain title to property in the TRNC as non-nationals, you are required to obtain a purchase permit from the Council of Ministers. For nationals of the Republic of Turkey, it is a speedy process, usually not taking longer than 2 months. For nationals of other countries, the process can take up to 18 months. Your file is submitted by your solicitor with copies and originals of required documentation and sent off for evaluation by several government bodies. The approval rate is very high. The government is reluctant to grant permissions where the property is near a military installa2on so take this into consideration when selecting your location of preference. If you are buying from a non-national registered owner, it is usually the case that you will be granted a satisfactory PTP.
Ownership and fees/taxes
Contractual ownership is where a charge is placed over a property ensuring the buyer as the contractual owner. A Contract of Sale comprises the agreed terms and conditions between parties towards a common objective. It is essential that you work with a reputable agent and solicitor who has can safeguard your best interests. Your contract of sale should protect your rights and enable remedy for a defaulting party. Once a Contract of Sale is signed between two parties, a fee of 0.5% of the sale price is paid to the Income and Tax Office as stamp duty. This must be paid within 21 days of signing the Contract of Sale, otherwise the fee triples after 21 days. The Purchaser is able to register the stamped contract at the Land Office. No other taxes are payable at this stage except for a minimal registration fee. The Purchaser does not receive title and the deed remains in the previous owner’s name. This is normally the avenue that non-nationals use while waiting for their PTP to be approved or where they own more than one property.
Registered ownership involves taking title to a property. Once your PTP has been approved, you become en2tled to take the property into your name. Your agent or solicitor must apply for the property to be valuated in order to calculate the fees that will apply when taking title.
At the moment, there are fee deductions at the Land Registry between 1-4% and will be calculated according to
- the size of the property ie 140m2 or smaller, 140-300m2 or above 300m2 closed area
- whether you have u2lised your once in a life2me buying discount or not
Please note that if you were the contractual owner before applying to take 2tle, the Land Registry will use your sale price as the assessed valuation and therefore taxes will be based on the original sale price.
Please note further that an additional 5% VAT is payable if you are buying from a professional Vendor. This is usually the case when you are buying a new home. This may be subject to the terms of the contract you have agreed with the Vendor.
Selling property in the TRNC is an easy process. If you are a contractual owner, you will de-register your contract from the Land Registry for a minimal charge and in exchange of the considera2on sale price. If you are the registered owner, you will be required to pay 2.8% on the assessed valua2on as Capital Gains Tax. Please note that each individual has a tax exemption they can utilise. The Capital Gains Tax exemp2ons are provided as follows:
tax exemption for one home AND a tax exemption for one donum of land (1338 m2); OR
tax exemption for one shop
This is a brief guide and each sale has circumstances of its own. Please feel free to contact our office with any property matters. We will be happy to assist you. +90 542 879 61 56
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