VAT returned for first time buyers

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VAT returned for first time buyers

Post by [email protected] » 27 Jan 2008 01:00

Hi Nigel

I'm really confused with this setup of the VAT returned for first time buyers. My Lawyer has advised me that when I sell my villa, the new buyer will receive the VAT refund. However, the Agent says that because the buyer is not buying directly from the Developer the property will be classed as a resale.

My Lawyer said that this is rubbish. As no one has every used the property and no utility supplies have ever been connected then when I sell it will be as if I never existed.

Then another Agent came along and said that it is only Cypriot Citzens who are entitled to it. Surely now that we are in the EU there can't be one rule for one and other.

Have you got any idea who's right?



Nigel Howarth
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Re: VAT returned for first time buyers

Post by Nigel Howarth » 27 Jan 2008 12:31

Hi Tina,

Let me clear up the confusion:
My Lawyer has advised me that when I sell my villa, the new buyer will receive the VAT refund. However, the Agent says that because the buyer is not buying directly from the Developer the property will be classed as a resale.

My Lawyer said that this is rubbish. As no one has every used the property and no utility supplies have ever been connected then when I sell it will be as if I never existed.
Your lawyer is correct.

The VAT refund scheme applies to the sale of new properties. (There is currently no VAT payable on resale properties, so there isn't a VAT refund scheme for them).

If the property you bought has been lived in, then it will be treated as a resale property when you come to sell it. But if the property has not been lived in, it will be treated as a new property when you sell it and your buyer may be able to claim the VAT refund.
Then another Agent came along and said that it is only Cypriot Citizens who are entitled to it. Surely now that we are in the EU there can't be one rule for one and other.
That's rubbish - the VAT refund scheme is available to all EU citizens.

(there's a page on my website that explains the system. You can view it by clicking on VAT Regulations).

Regards


Nigel Howarth
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