Buying a 50% share of a property

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svensson2
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Joined: 01 Jan 2014 21:37

Buying a 50% share of a property

Post by svensson2 » 09 Jan 2014 00:12

Hi Nigel,

I have been reading on your site and find it informative and clear. I have a few questions and wonder if you can help.

My mother and father are divorcing and own a small property in Paphos in joint names. I have discussed purchasing my fathers share (50%) for £28,000 (sterling). I wonder if you can shed some light on how best and easiest to complete this transaction.

What are the costs involved? I am resident in Sweden and my father in the UK
I think he wants to be paid in british pounds (is this possible?)
Can you recommend some solicitors?
Would we need to travel to Cyprus to complete this transaction?
What do I need to be aware of? I know that the house has title deeds and is on a complex.
Best regards
Steve



Nigel Howarth
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Re: Buying a 50% share of a property

Post by Nigel Howarth » 09 Jan 2014 12:20

Hi Steve and welcome to the forum,

As your father has the deeds to the property, this will be a very straightforward transaction.

I believe the simplest way to go about this is for your father to give his share of the property to you and then you can pay him the £28,000 as a thank you gesture. (none of the money needs to come to Cyprus).

As he's your father, the Property Transfer Fees will be very low - 0.2% of half the property's value as shown on the Title Deed. (The Land Registry published a revised scale of charges 10 days ago, a copy of which you can download by clicking here).

Your father will need to get receipts confirming that the following have been paid:
  • Immovable Property Tax.
    Capital gains tax.
    (Receipts of payment for all the above taxes and duties may be obtained from the Internal Revenue Department).
    Sewerage Board Tax. (Receipt obtained from the Sewerage Board).
    Town rate. (Receipt obtained from the municipality in whose boundaries the property is situated)
    Communal rate. (Receipt obtained from the community in whose boundaries the property is situated)
and these will need to be taken to the Land Registry to enable the transfer to proceed.

One thing I'm not too sure about is whether your father has to give your mother first refusal on the property. This used to be the case, but I'm not sure if it still applies.

A lawyer should be able to do everything for you (including chasing around to get the various receipts). But you will both have to give a lawyer Power of Attorney to act on your behalf - you can both use the same lawyer. For a Power of Attorney to be valid, it has to be signed and witnessed in the presence of a Certifying Officer so you will both have to make arrangements to visit a Cypriot Government office to get the PoA formally certified.

As for a lawyer, the British High Commission publishes a list of English Lawyers that you can download by clicking here. I suggest you contact a couple of them that have offices in locality and get some competitive quotes.

Regards,


Nigel Howarth
Independent information & advice for Cyprus property buyers
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svensson2
Posts: 3
Joined: 01 Jan 2014 21:37

Re: Buying a 50% share of a property

Post by svensson2 » 09 Jan 2014 23:03

Hi Nigel,

Thanks for the response. I am going to contact a couple of the solicitors from the British High Commision website and get some quotes. I noticed that most are in Nicosia but i assume that they may have local offices in Paphos.

Just wanted to check about the property transfer fees - are they 0,2% or 2% of the value? Also, would an enbassy count as a cypriot government Office, eg one in Sweden,, and one in the uk?

Regards

Steve



Nigel Howarth
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Location: Erimi, Limassol, Cyprus
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Re: Buying a 50% share of a property

Post by Nigel Howarth » 10 Jan 2014 10:01

Hi Steve,

Some of the lawyers have offices in Paphos - the list shows if they do.

The Property Transfer Fees are 0.2% (one fifth of one percent). And yes - embassies count as government offices.

Regards,


Nigel Howarth
Independent information & advice for Cyprus property buyers
Contact Nigel Howarth
Read the latest Cyprus property news

Pantheman
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Joined: 26 Jan 2008 14:44
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Re: Buying a 50% share of a property

Post by Pantheman » 10 Jan 2014 14:42

Nigel / Steve,

If I may interject something here;
Even though the father can gift the property with very minimal TFs (around €1000), it would be better in the longer term, to pay the TFs as when you come to sell it, you could be hit with a CGT as you will not have anything to offset the gains with which could result in around 5K -6K.

Better to do a contract to show you paid this money approx €35k so that it is on record, it is more cost effective.

Then you will need to get a signed declaration from the mother to say she has no interest and agrees to the sale.

Hope that helps.

Regards

Pan

P.S. Happy New Year to All.

P.S.S. Steve I guess you have an EU passport?? if not, you cannot do a direct transfer, but will need Council of Ministers Permission that your lawyer can arrange.


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