Property Highlights in the 2015 Budget
A number of items were announced in the 2015 Budget speech ranging from tax cuts for high earners to unchanged bus fares; If you are interested in those related to property, below are the highlights.
Final Withholding Tax – With effect from the 1st January 2015, the 35.0 per cent Capital Gain Tax will be replaced by an 8.0% Final Withholding Tax (FWT), applicable to traders and non-traders alike. However, in case of non-traders, property acquired before 2004, the applicable FWT rate will be 10%, while for property acquired less than 5 year period before the transfer of title, the FWT rate will be 5%.
Owners selling their main residence (for at least 3 years) are still exempt from Capital Gains or Withholding Tax.
Exemption on Purchase of First Property – The last budget introduced a one-time concession for those individuals who had never owned immovable property and who purchased property as a residence during 2014. This measure will now be extended to 30th June 2015. Frank Salt Real Estate is proud to announce that it’s First Time Buyer scheme has also be extended until 30th June 2015. For more information on this scheme, click here.
Tax Exemption on Property divided between Co-Owners – In cases of contracts for the division of immovable property where the owner acquires a share which has the same value as when it was undivided, no tax will be payable. This measure will give the owners the chance to divide the Property between them without having to pay excessive taxes. Co-owners will have the facility of not selling their share.
Exemption from Capital Gains Tax – The Budget will introduce a tax exemption on capital gains and stamp duty on property, whose transfer of title occurred from one of the owners to the other, and was acquired by two individuals with the aim of residing in it or building their main residence there on.
Choice of Main Residence for Tax Purposes -The Government will continue to simplify and strengthen the tax system in order to reduce abuse of the tax exemption in the context of the sale of property which was their main residence for more than three years. For this aim, a system will be introduced where individuals would be required to state their main residence according to transparent rules and conditions.
If any of the above information is unclear, feel free to contact any of our branches where our consultants will be more than happy to answer any of your questions.