1. PROPERTY TRANSFER FEE
The temporary reductions in Property Transfer Fees that that came into force in 2015 and applied to transfers that took place by 31 December 2016 was made permanent in July 2016.
- If VAT was paid on the purchase price of the property, no Property Transfer Fees are payable.
- If VAT was not paid on the purchase price of the property, the Property Transfer Fees are reduced by 50%.
However if the Director of the Land Registry considers that the price stated on the contract of sale does not reflect the market value of the property at its date of purchase he may, at his discretion, charge the full Property Transfer Fees based on the Land Registry’s assessment of the market value of the property at its date of sale less the price stated on the contract of sale.
2. IMMOVABLE PROPERTY TAXES
Immovable Property Tax (IPT) was reduced in 2016 to approximately a quarter of that in the previous year and is abolished in 2017.
3. CAPITAL GAINS TAX
Capital Gains Tax is levied at 20% on gains arising from the disposal of the property when the seller is an individual and 10% for legal entities (corporate tax). However, for foreign-owned property that is sold, generous allowances and exemptions from Capital Gains Tax exist. As the gain also takes into account inflation, the actual appreciation coupled with the allowances and exemptions results in a minimal taxable amount. The first €85,430 made by an individual are exempted from tax.
4. SELLING YOUR PROPERTY
When you sell, you can repatriate all of the funds immediately used to the value of the purchase, including any amounts spent on improvements and/or additions to the property and paid for in properly imported foreign currency.
5. STAMP DUTY
The purchaser is liable for the payment of Stamp Duty at the rate of €2.56 per thousand up to the value of €170,860 and thereafter at the rate of €3.41 per thousand.
This duty should be paid within 15 days of the signing of the contract.
6. MORTGAGE FEES
There is a registration fee of 1% of the amount secured, plus any relevant stamps. Local banks grant loans in the local currency as well as a foreign currency of your choice. Alternatively you can apply for a loan from your own private bank abroad.
ON – GOING COSTS
PROPERTY OWNER COSTS (Approximate average for a 2-bed property, full usage)
1. Electricity: €250, every 2 months.
2. Water: €50 every 4 months.
3. Sewerage: €100 per annum.
4. Common expenses for apartments: €350 per annum.
5. Garbage tax: €150 per annum
(Prices vary depending on location and type of property)