Cyprus Property – A guide to living and investing in Cyprus (Part V)
DRIVING LICENSE
Cyprus is a left-hand drive country. Regulations for driving in Cyprus for non-Cypriots differ according to nationality.
The EU driver’s licence is now valid in Cyprus. If an EU citizen chooses to either visit or settle in Cyprus, they can receive full coverage from insurance companies. EU citizens can renew their licence in Cyprus before it expires, whereupon they will receive a Republic of Cyprus’ drivers licence. Should one attempt to renew their licence after the EU drivers licence has expired, they will be subject to a driving test in order to attain a Republic of Cyprus licence.
It is possible for visitors from other countries to drive in Cyprus using a valid international driving licence or by using their national driving licence, provided that this licence is valid for the vehicle the driver is using. Should you wish to obtain a Republic of Cyprus driving licence, a national licence can be converted into a Cypriot license or the Cypriot driving test can be taken.
Obtaining a Cypriot licence will cost very little and is valid until 65 years of age. Thereafter, it is renewed on an annual basis, subject to a medical examination.
APPROVAL OF THE COUNCIL OF MINISTERS
Having signed a contract of sale for your property, it will be necessary to file an application to the Council of Ministers to approve the acquisition of the immovable property. This is a routine procedure and you will be assisted by our partner company in the processing and monitoring of your application as part of its complimentary customer services.
For EU citizens who intend to reside permanently in Cyprus, no such application is required.
SELLING YOUR PROPERTY
If and when you decide to sell your property, you will be entitled to transfer the proceeds out of Cyprus, including the original purchase price as well as any profit.
Property Taxes/ Fees
A) Property Transfer Fees – These are necessary in order to transfer FREEHOLD ownership into your name and this can be done as soon as the relevant Government authority has issued the title deed and your account with the seller/developer has been settled. This is a one off fee payable to the Land Registry Office according to the following scale:
Value of Property ................... Transfer Fee Rate
Up to €85,430 ................................... 3.0 %
€85,431 – €170,860 ........................... 5.0 %
Over €170,860 ................................... 8.0 %
For example:
Purchase Price €205,032
1st €85, 430 ... @ ... 3% = €2,563
2nd €85,430 ... @ ... 5% = €4,272
3rd €34,172 ... @ ... 8% = €2,734
TOTAL ................... €9,569
However, if the property is purchased jointly by a couple (as is often the case) the property purchase price is split equally into two parts and then taxed, which is beneficial to the purchasers as the following example shows:
Purchase Price €205,032 divide by 2 = €102,516
1st €85,430 ... @ ... 3% = €2,563 x 2 = €5,126
2nd €17,086 ... @ ... 5% = €854 x 2 = €1,708
TOTAL .................... €6,834
B) Local Authority Taxes (Rates) – These are dependant on the size and location of your property and for refuse collection, street lighting etc. An average annual charge is approximately €200
C) Immovable Property Tax – The registered owner of the property is liable for this annual tax, which is based on the value of the property.
Value of Property ................. Annual Tax (per thousand)
Up to €170,860 ............................... Exempt
€170,861 – €427,150 ....................... €2.50
€427,151 - €854,301 ........................ €3.50
Over €854,301 ................................. €4.00
D) Capital Gains Tax – This applies to the income arising from the disposal of immovable property in Cyprus, the fare of which is 20%. However, there is an indexation allowance and other generous exemptions, details of which can be obtained.
E) Inheritance Tax – This tax has been abolished in Cyprus as from January 2000. Further information can be obtained from the legal department.
F) Stamp Duty – The purchaser is liable for the payment of stamp duty at the rate of €1,5 per thousand, up to the value of €170,860 and thereafter the rate is €2,00 per thousand. Our legal department will, at your request, pay this and debit your account, relating to your property purchase.
Courtesy: Leptos Estates
FOR FURTHER INFORMATION
Contact: Yianni Pavlou
Email: [email protected]
Tel: ++27 82 4944555
Disclaimer: The information in this property guide was correct at the time of going to press and is for guidance only. Leptos Estates accepts no responsibility for future changes in trends, figures and legislation.
