Buying a House - 50% Reduced Transfer Fees. How much do you pay?
Knowing the amount of transfer fees when buying a property in Cyprus can help you plan your finances more accurately and avoid surprises when completing the property purchase.
The Land Registry offers a 50% reduction in real estate transfer fees for all cases where Chapter 17 fees are imposed or collected. Calculating the fees and applying the discount offered by the Land Registry requires a good understanding of how to calculate and properly apply the 50% reduction.
BuySell, the number one real estate platform in Cyprus, offers an easy and simple way of calculating transfer fees when buying a property. You can enter the property's value in the Transfer Fees Calculator provided by BuySellCyprus.com, and with one click, you can calculate the amount of transfer fees.
What are transfer fees?
Transfer fees are a tax payable to the Land Registry when a property changes ownership. The buyer pays these fees, which are based on the purchase price of the property or its market value, whichever is higher.
No transfer fees are payable if the transfer relates to a transaction subject to VAT (e.g. new property - either standard or reduced rate VAT).
How are transfer fees calculated?
Transfer fees are calculated based on a scale of rates, which means that the percentage of transfer fees increases as the value of the property increases.
Below is a breakdown of the rates:
3% for property values up to €85,000
5% for property values between €85,001 and €170,000
8% for property values above EUR 170,000
However, the Cyprus government currently offers an incentive where only 50% of the transfer fees are paid. This means significant savings for buyers.
To get a clear picture, let's look at some examples with the 50% discount incentive on transfer fees:
Example 1: Property worth €100,000
First 85,000 euros at 3%: 85,000 euros x 3% = 2,550 euros / 2 = 1,275 euros
The remaining 15,000 euros at 5%: 15,000 euros x 5% = 750 euros / 2 = 375 euros
Total transfer fees: €1,275 + €375 = €1,650.
Example 2: Property worth €200,000
First €85,000 with 3%: €85,000 x 3% = €2,550 / 2 = €1,275
Next €85,000 at 5%: €85,000 x 5% = €4,250 / 2 = €2,125
Remaining EUR 30,000 with 8%: EUR 30,000 x 8% = EUR 2,400 / 2 = EUR 1,200
Total transfer fees: €1,275 + €2,125 + €1,200 + €1,200 = €4,600
Example 3: Property worth €500,000
First €85,000 with 3%: €85,000 x 3% = €2,550 / 2 = €1,275
Next €85,000 with 5%: €85,000 x 5% = €4,250 / 2 = €2,125
Remaining EUR 330,000 with 8%: EUR 330,000 x 8% = EUR 26,400 / 2 = EUR 13,200
Total transfer fees: €1,275 + €2,125 + €13,200 = €16,600.
These examples show how the total amount of transfer fees increase with the value of the property but at different rates.
Easy way to calculate transfer fees
Understanding and calculating transfer fees can seem difficult, but BuySellCyprus.com offers a handy Transfer Fees Calculator to simplify the process. Enter the property's value and calculate the transfer fees you will need to pay with just one click.
Factors affecting transfer fees
- Transfers due to restructuring of companies are not subject to transfer fees.
- No transfer fees are payable for the property transfer to the creditor in the context of restructuring.
- If a property is purchased jointly e.g. registration in the name of two spouses, transfer fees are apportioned according to the share of ownership.
- Occasionally, the government may offer incentives or reductions in transfer fees to stimulate the property market.
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