Transfer fee is a tax on the transfer of ownership when buying a home. To become a full owner of real estate, you must obtain a title. And in order to issue this certificate, you need to pay the Transfer fee tax at the Land Department of Cyprus.
The duty is levied only on secondary real estate. Buyers of new buildings do not pay a Transfer fee.
Transfer fee in Cyprus
The amount of payment depends on the value of the object. The calculation is made in this way:
- amounts up to €85,430 are taxed at 1.5%;
- amount from €85,430 to €170,860 – 2.5%;
- the amount over 170 860 € – 4%.
For example, if you purchase a property worth €200,000, then the fee is calculated as follows: (€85,430 x 1.5%) + (114,570 x 2.5%) = 1281.45 + 2864.25 = 4145, 7€.
If the property is transferred free of charge, then the new owner must also pay a tax on the transfer of ownership. The tax percentage depends on the degree of relationship between the seller and the buyer: parents-children – 0%, spouses or third-degree relatives – 0.1%.
How to reduce Transfer Fee
It will not work to artificially reduce the amount of the fee by indicating a lower value of the object. The final amount of the tax payment is determined by the Land Department after a thorough check and evaluation of real estate and comparing its value with similar objects on the market.
But you can still save on taxes. If there are two or more owners, then the Transfer Fee is reduced, since the taxable value for each owner is reduced proportionally.
If you have questions about taxes and the real estate registration process, please contact us by phone or via chat on the website. The Estate of Cyprus agency will provide full legal support for the sale and purchase transaction and help you get ownership of the property without any problems.