Cyprus has long been a magnet for international property buyers, thanks to its Mediterranean charm, favourable tax conditions, and strategic location. The island’s real estate market is buoyant, attracting a diverse range of buyers from Europe, the Middle East, and beyond. This diversity ensures a steady demand, making it an opportune time for UK residents to consider selling their Cypriot properties.
Engaging the Right Professionals
Embarking on the property-selling journey requires assembling a team of trusted professionals.
Real Estate Agent: A licensed real estate agent, registered with the Real Estate Agents Council in Nicosia, is invaluable. They possess in-depth knowledge of the local market, can provide accurate property valuations, and have the expertise to market your property effectively to potential buyers. Their responsibilities include advertising, coordinating viewings, and negotiating offers on your behalf.
Legal Advisor: While not mandatory, hiring a qualified lawyer is highly recommended. They will safeguard your interests, ensure all legal documents are in order, and guide you through the complexities of the sale process. If you’re unable to be present in Cyprus, granting your lawyer power of attorney allows them to manage the transaction on your behalf. This power of attorney must be notarized and apostilled if signed outside Cyprus.
Preparing Your Property for Sale
First impressions matter. Before listing your property, ensure it is clean, decluttered, and well-maintained. Address any minor repairs and consider cosmetic enhancements to boost its appeal. A fresh coat of paint, tidy gardens, and well-lit interiors can make a significant difference. Professional photography can also showcase your property’s best features, attracting more potential buyers.
Setting the Right Price
Determining an accurate and competitive asking price is crucial. Your real estate agent can provide a market appraisal, considering factors like location, property size, condition, and recent sales of similar properties in the area. Setting a realistic price not only attracts serious buyers but also expedites the sale process.
Marketing Your Property
Effective marketing is key to reaching potential buyers. Your agent will list your property on various platforms, both local and international, to maximize exposure. They will also handle inquiries, schedule viewings, and provide feedback from prospective buyers. In today’s digital age, leveraging social media and virtual tours can further enhance your property’s visibility.
Offers and Agreements
Once offers start coming in, your agent and lawyer will assist in evaluating and negotiating terms to ensure they align with your expectations. Upon accepting an offer, a reservation agreement is typically signed, accompanied by a deposit from the buyer. This agreement reserves the property for a specified period, usually around 45 days, allowing both parties to conduct due diligence and finalize the sale terms.
Finalizing the Contract of Sale
The contract of sale is a legally binding document outlining all terms and conditions of the transaction, including the sale price, payment schedule, and completion date. Both parties must agree to these terms, and the contract must be signed and stamped at the Inland Revenue. Subsequently, it should be deposited at the District Land Registry Office within six months to ensure its legal enforceability.
Tax Obligations
As the seller, you’re responsible for several taxes and fees:
Capital Gains Tax (CGT): Charged at 20% on the profit from the sale. However, exemptions exist. For instance, a personal tax-free allowance of €17,086 applies if you haven’t sold property in Cyprus before. This can increase to €85,000 if you’ve lived in the property for at least five years.
0.4% Levy: Introduced in 2022, this tax is imposed on the sale price and must be paid by all sellers of immovable properties in Cyprus.
Other Fees: Ensure all local taxes, such as sewerage board tax, town rates, and communal fees, are paid. Obtain receipts and a tax clearance certificate from the Inland Revenue.
It’s essential to consult with your lawyer to understand these obligations fully and ensure compliance.
Completion and Transfer of Ownership
After obtaining the necessary tax clearances, your lawyer will coordinate with the buyer’s legal representative to schedule an appointment at the District Land Registry Office. During this meeting, the remaining balance is paid, keys are handed over, and the title deed is transferred to the buyer. If the buyer is a non-EU citizen, they must obtain approval from the Council of Ministers before the transfer.
Post-Sale Considerations
Once the sale is complete, ensure all utility bills are settled, and services are transferred to the new owner. Your lawyer can assist in confirming these changes. Additionally, inform HMRC of the sale, as UK residents are subject to UK taxation on worldwide income, including capital gains. The Double Taxation Treaty between the UK and Cyprus ensures you don’t pay tax twice on the same income.
Selling your property in Cyprus from the UK involves several steps, but with thorough preparation and professional guidance, it can be a smooth and successful process. Engage experienced real estate agents and lawyers, understand your tax obligations, and ensure all legal requirements are met to facilitate a seamless transaction.
If you’re ready to embark on this journey, reach out to esales international, we can guide you every step of the way, ensuring a successful and stress-free sale.
