I P T

[Steve P]

Hello Nigel. I'm new to the forum and have just received news about the changes to IPT.
How should I deal with this?
I own the plot of land that my house is built on (registered under my name at the Land registry). The developer owns the remaining two plots. The planning permit is for three houses to be built. My house has been complete for two years, but there is no sign of building on the other two plots.
I understand that as my house is part of the same permission as the others I cannot get my certificate of completion or deeds until all the buildings are complete. This may never happen!
I understand from the articles on the forum that I have been living illegally in my house for two years! I'm sure that I'm one of thousands living in a house awaiting completion certificates and deeds!
What IPT should my builder be paying? How can I check if my portion has been paid? (He has not asked me for any tax payments.)
I would be glad to hear from you with any advice.
Regards Steve P.

[Nigel Howarth]

Hello Steve P and welcome to the forum.

If you have the Title Deeds for the land then you should pay IPT - for more information see Money off your Immovable Property Tax bill

Regards,

[Steve P]

No I don't have the title deeds to the land. I have 'specific performance' for my portion of the total plot.
Steve.

[Nigel Howarth]

No I don't have the title deeds to the land.

You don't need to do anything.

Regards,

[Steve P]

So I presume my developer/builder should be paying.
How do I check, and how much should he pay on my behalf?
Regards Steve.

[Nigel Howarth]

Hi Steve,

Take a look at http://www.cyprus-property-buyers.com/law/tax.htm

Regards,

[nlp]

Hi Nigel

It would seem that the tax authorities arrive at 1980 values for IPT purposes by the "finger in the air" method or is there some rule of thumb we could use to assess our properties?

Many thanks

[Nigel Howarth]

is there some rule of thumb we could use to assess our properties?

Unfortunately not.

The amount of IPT the developer has to pay is assessed by the Inland Revenue. In year one, the developer should declare to the Inland Revenue the 1980 value of the land on which he is building (as shown on its Title Deed) plus the 1980 value of the improvements he’s made to the land – this will be the cost of materials and labour calculated back to 1980 using the Consumer Price Index (I think) – and will pay the Inland Revenue IPT accordingly. In 2nd and subsequent years the developer declares the previous year’s declaration PLUS the 1980 value of the improvements he’s made in that year. And so it goes on – and on – and on.

When the Land Registry (eventually) issues a Title Deed for the property you have purchased, it will assess the 1980 value of the property using its historical data and enter that amount on the deed. After you pay the Property Transfer Fees, you will become the registered owner of the property and will be responsible for paying IPT to the Inland Revenue.

And you will also be able to reclaim any legitimate overpayments of IPT that you paid to the developer.

It’s a crazy system I agree – but hey, this is Cyprus!

Regards,