THE real estate market is slowly picking up after a sluggish period. Nevertheless, we are still in the situation where buyers can pick and choose. Because of this, sellers with properties that don’t have their paperwork in perfect order, dramatically reduce their chances of a sale. It is always advisable to review all property paperwork with your lawyer.
Costs for the seller
As the vendor you will have various costs to pay when you sell your property: Plus Valia or Municipal Capital Gains Tax: This is calculated by the town hall and is based on the increased value of the land since it last changed hands.
Estate agent, lawyer, notary and other professional fees: Normally the vendor pays the estate agent, but exceptionally a buyer and vendor can agree to split the costs. This will have to be included in the private sales purchase contract. Each party will pay their own lawyer. The payment of other professionals can be agreed between the parties.
Capital Gains Tax:You also have to pay Capital Gains Tax on the difference between the amount that you bought the property for and the amount that you are selling it for. Since the 1st of January 2015 the way to calculate Capital Gains Tax has been simplified.
Inflation indexing has been removed and abatement coefficient will be applied only for the first 400,000€ of capital gain (abatement coefficient scan be applied only to properties purchased before 1995). Capital gain is therefore the difference between the sale and purchase price reduced by the costs inherent to the purchase and sale (real estate fees, notary, taxes, etc…).
Capital Gains Tax for Non-residents: In 2015 Capital Gains Tax will be 20 per cent of capital gain. This will decrease to 19 per cent if the sale is in 2016. Of this amount non-residents will have to pay 3 per cent of the purchase price directly to the tax office at the time of signing the sale deeds.
The buyers retain this amount (3 per cent) from the sales price and pay the tax office by completing Form 211. In case this amount is higher than the Capital Gains Tax you can ask for the difference back by filing Form 210.
Your lawyer will be able to advise you on this procedure. You should keep in mind that your yearly non-resident’s tax has to be paid up to date when selling your property.
Capital Gains Tax for Fiscal Residents: For fiscal residents, Capital Gains Tax will be regulated by income tax according to the following table:
|50000€ and above||24%||23%|