We undertake all matters relating to sale of real estate in Cyprus, whether or not the seller is located in Cyprus or abroad, including:
- Preparation of Power of Attorney(s) were owner(s) are not residing in Cyprus.
- Land Registry Search (for any encumbrances and/or mortgages and/or prohibitions which may be registered οn the property, urban planning permit, building permit etc).
- Drafting, negotiating and/or reviewing the Contract of Sale.
- Undertaking the payment of debts, utilities and taxes. (When selling a property any outstanding amounts for debts, utilities and taxes must be cleared. These amounts will be communicated to you prior to the sale of the property.)
- Completion of Conveyancing.
What do I need to pay when selling property in Cyprus?
The following is an indicative list of the things you will have to pay when selling your property in Cyprus:
- Capital Gains Tax (outlined below).
- Any outstanding mortgage.
- Balances to utility authorities, local authority taxes (e.g. refuse and sewage) and management committee (if in a building block or project with communal areas).
- Agent’s commission which usually ranges from 3%-5%.
- Legal fees which are usually 1% of sale value and disbursements (e.g. for the certification of documents).
In addition, the law provides that every seller of property must deliver an Energy Efficiency Certificate but some buyers don’t insist on this.
Cyprus Capital Gains Tax on Sale of Immovable Property
Capital gains tax applies on the profit made on the sale of a property at the rate of 20%. This is calculated on the gains from the disposal of immovable property in Cyprus, subtracting the original cost and additional expenses from the proceeds of the sale. Both inflation and allowable expenses are also factored into the final amount of taxable gains.
For example, the cost of acquisition used for the calculation of the profit also includes any payments made for the improvement of the property or for any additions on the property as well as any interest paid for the acquisition.
In cases of inherited property, the original cost will be that which is shown on the title deed as at 1st January 1980. This must be adjusted to include the increase from the date of acquisition, up to the date of disposal. This increase can be estimated via Cyprus consumer price index.
Capital Gains Tax Exceptions
Individuals are entitled to certain exemptions from capital gains tax, however, these are one lifetime allowances and apply to each registered owner.
The first exemption of €17,086 occurs if the gains are obtained from the disposal of any property.
The second exemption of €85,430 occurs if the gains are obtained from disposal of primary residence. The second exemption applies only if the property in question was owned and used as the primary residence for a period of at least 5 years.
The third exemption of €25,629 relates to the agricultural land sold by the farmers.
The above allowances are not available separately. An individual claiming a combination of the above allowances in only allowed a maximum allowance of €85,430.
Estate agent fees and legal fees are also deducted when calculating the total Capital Gains Tax to be paid.
In addition to the Capital Gains Tax, as of February 2021, a new 0.4% tax on the sales of immovable property will be imposed to support Greek Cypriot refugees and paid by the seller.
