Buying property in the TRNC can be complicated and exhausting for those who do not know the law and legal procedure. This information provided on these pages has been provided by a well-known lawyer specialized in this field, taking advantage of many years of experience in the transmission procedure for the sale and purchase of residential and commercial properties in Northern Cyprus.
What is the type of your property?
After the island was divided, Northern Cyprus developed its own rules and regulations in 1974, and a different legal system was established by Turkish Cypriots in relation to the transfer of real estate ownership. The first and most important issue that needs to be explained is the various types of title deeds that exist in the TRNC today.
The various title deeds are as follows:
Before Turkish Cypriot or other foreign ownership in 1974: This type of title deeds are considered to be completely safe.
Greek Cypriots, before 1974, were known as the Freedom of the TRNC and were called the Land of Co-value or Exchange. This is the land given to the Turkish Cypriots by the TRNC Government in exchange for the lands they lost in the South when the island was divided. Based on the 1983 TRNC Constitution, all land titles are corrected and called TRNC land titles and are freely transferred to locals and / or foreigners.
Allotment (TMD) Deeds: This is the land that belonged to a Greek Cypriot before 1974. Allotment deeds were issued by the TRNC Northern Cyprus government after 1974 and given to a Turkish Cypriot refugee or a resident of the Turkish continent.
Housing Loan - These are properties owned by the TRNC Government and will be rented for a long-term period of 49 years.
Taxes on the Purchase of Property
There are four main taxes related to the purchase/sale of any property, these taxes are as follows:
VAT:The tax office requests that a copy of the Sales Contract be submitted before the transfer of the title deed. Then, VAT is calculated according to the Contract value of the property and is determined as 5% of the contract value. Paying VAT belongs to whether the transaction is subject to VAT or not. This depends on whether the Seller (the person who owns the property, or does not own the property) is considered a 'Professional Seller' by the Tax Office (whether the transaction is of a commercial nature or a profit). If the seller is considered a Professional Seller, the transaction will be subject to VAT (bound). If the seller is not a Professional Seller, but a private person, the transaction will not be subject to VAT (bound).
Transfer Fee:The transfer fee is paid by the buyer to the Land Registry and Cadastre Office before the land registry transfer transactions take place and is 12% of the tax value of the property. The Land Registry and Cadastre Office will examine the Sales Contract before the land registry transfer process to evaluate the property tax and calculate the Transfer Fee based on the tax value. The Transfer Fee is usually paid by the Buyer, but this may vary between the parties to the Sales Contract. Dec.
Note: The first 6% part is paid at the contract registration and the remaining 6% is paid at the purchase of the cob.
Stamp Duty:Stamp duty is paid to the tax office and calculated on the contractual value of the property. Stamp Duty is usually paid by the Buyer, but this can be changed between the parties in the sales contract. All sales contracts must be registered at the regional directorate of the Land Registry and Cadastre Department within 21 days from the time of signing. Stamp Duty must be paid at a rate of 0.5% in order to be registered.
Capital Gains Tax (Withholding):Capital Gains Tax can usually be paid by the Seller, but this can always be changed between the parties in the Sales Contract. Dec. The Tax Office requests that a copy of the Sales Contract be submitted before the transfer of the title deed. Then, it calculates the Capital Gains Tax based on the tax value of the property, and this is currently 4% of the kind. It should be noted that Capital Gains Tax should be paid on the full sale price, not just the profit from the sale. You also have the right to opt out of paying this tax only once, so you should choose wisely when you do so.
How can we help you?
We work with lawyers who speak English and Turkish, but also know the laws of the UK and TRNC well. They will provide independent and professional services to customers who want to buy real estate, helping customers to make safe and efficient transactions from the preliminary stage to the completion stage.
At the first meeting, you will discuss the characteristics of the property you have purchased and review any informal agreements you have made with the seller regarding the purchase price, pay plan and all the products included in the sale. The procedures that you need to follow, including taxes and fees, will require you to make additional payments on your behalf to ensure that the transactions are carried out safely and efficiently. This stage, at the same time, has been a long time coming. If you are located far from Northern Cyprus, a power of attorney may need to be obtained from you to ensure that action is taken on your behalf to sign documents.
As a result of the recent laws, your identity will be confirmed before you start working on your behalf. The identity should be as follows:
*Original Passport / Original Driving License
*Last Bank Statement/ Electricity Bill (not older than 3 months)
In addition, further document processing may be required in accordance with existing money laundering regulations. An explanation will be given to you about this.
The general principles of Transfer Transaction Services are summarized below:
A land registry registration search will be conducted at the relevant Land Registry and Cadastre Office in order to confirm that the seller is the registered owner of the immovable property and that the property is exempt from any restitution, expenses or compensation.
All documents will be examined and it will be checked that the relevant building permits, construction permits and approvals have been obtained.
In order to protect your rights and interests, a Sales Contract will be prepared and prepared according to your specific requests. This agreement will determine the terms of sale, completion dates, pay schedule and any immovable property and equipment, responsibilities of both parties, delay penalties and indemnity clauses.
The contract will be given to you and the seller for review, and the contract will be signed if both parties are satisfied with the terms. After being satisfied with the search results, the contracts have been signed and amended, the Sales Contract will be registered with the Land Registry and Cadastre Regional Dec. Before registration takes place, all sales contracts for the purchase of real estate must be registered at the Land Registry Regional Office within 21 days from the signing of the contract, and stamp duty must be paid at the rate of 0.5% of the property value previously. Registration of the contract allows you to protect yourself from the property being sold or transferred to a third party and any collateral that will be given to your property later.
According to the laws of the TRNC, non-TRNC citizens have the right to own a single property up to a maximum area of 5 acres per household, provided that the property consists of only one residence and the property was completed during the transfer period (unless you create a company or create a trust with a local person). According to the Turkish Republic of Northern Cyprus (TRNC) Immovable Property Acquisition and Long-Term Lease (Foreigners) Law (TRNC), non-TRNC citizens must obtain a Purchase Permit from the TRNC Council of Ministers before the property is registered in their name.
The Council of Ministers will conduct the necessary research. Land, military and immigration research belong here. The Cabinet should know that you have a good character and do not have a criminal record. It is essential that sufficient permission is granted for you to purchase the property. You will be notified after your permission has been obtained and the necessary land registry valuation forms have been completed. Taxes that need to be completed will be paid and the transfer of deeds will be made in your name.
Obtaining a purchase permit can be a long-term procedure and can take up to a year, but this does not mean that you will not be able to own your new property once the contracts have been changed.
We ask that you check the above information with a lawyer or local tax authorities to guarantee that the rules and taxes may change and are currently valid.
Although this purchase process may seem a little daunting and complicated, it is actually very simple and Azant Real Estates will be with you every step of the way for a smooth purchase process for you.
For more detailed information [email protected] you can send us an e-mail from the address or [email protected] you can contact the expert lawyer Pınar Hanım who provides this information from her address.