This information was provided by Naomi Mehmet & Partners Advocates and Legal Advisers
Update 06/02/2025
NMP Legal - Naomi Mehmet & Partners
https://www.nmplegal.com/legal-updates/update-further-extension-to-deadline-for-paying-taxes-under.html
UPDATE: Further extension to deadline for paying taxes under the new Legislation of 21.05.2024
The deadline for paying taxes under the new Legislation of 21.05.2024 has been extended by a further 60 working days from 6th February 2025.
On 21st May 2024, the TRNC Government introduced new legislation under which all purchasers who had received their permission to purchase prior to the new legislation coming into force are required to take title to their property within 6 months of the new legislation coming into force.
The legislation stipulates that, in situations where it is not possible for a purchaser to take title to their property within this 6-month period due to the fact that the separate, individual title deeds or the interim individual deeds (known as ‘Kat İrtifak Koçanı’ in Turkish) for the property have not yet been issued, both parties (vendor and purchaser) must pay their transfer of title taxes within 60 working days of the new legislation coming into force.
Under a Council of Ministers decision issued on 12th November 2024, the deadline for paying the taxes under the new legislation was extended until 6th February 2025. This deadline has now been extended by a further 60 working days from 6th February 2025.
According to the Land Registry, in order to make payment of the taxes, the Land Registry valuation forms which are used for registrations of Contracts of Sale (rather than the valuation forms which are used for transfer of title) must be filled in and submitted to the Land Registry, together with the following documents:
- Stamped Contract of Sale
- A copy of the Council of Ministers’ decision confirming that the purchase permit application has been granted (your lawyer can provide you with the decision number and date and you will then need to obtain a copy of the decision from the Land Registry using the decision number and date)
- Passport/ID card copies for all parties (or in the case of companies, company documents) and powers of attorney for all parties (if applicable)
- Building permit for the site (this can be obtained from your vendor)
- Official seating plan of the site stamped the Municipality and/or District Office (known as ‘vaziyet planı’ in Turkish) (this can be obtained from your vendor)
Once the valuation has been carried out by the Land Registry, the vendor must first pay the capital gains tax (stopaj) at the Tax Office. If the transaction is subject to VAT, the VAT must also be paid or the VAT invoice (known as ‘fatura’ in Turkish) must be presented to the Tax Office at the same time as the payment of the stopaj tax.
Once this has been done, the purchaser can then visit the Land Registry to make payment of the Land Registry transfer fees.
The Land Registry transfer fees in all cases, regardless of when the Contract of Sale was signed and/or registered at the Land Registry are now 12% of the Land Registry valuation. In the case of purchasers who purchased after 10th February 2023 and who have already, therefore, paid 6% towards the Land Registry at the time of registering their Contract of Sale, only the remaining balance of the Land Registry fees, after deduction of the 6% paid at the time of the registration of the Contract of Sale, will be payable.
Update 14/12/2024
NMP Legal - Naomi Mehmet & Partners
https://www.nmplegal.com/legal-updates/council-of-ministers-decision-of-14th-december-2024-on-immov.html
Council of Ministers Decision of 14th December 2024 on Immovable Property Law
UPDATE: Under the Council of Ministers Decision published in the Official Gazette on 14th December 2024, the following amendments have been made to the Immovable Property Acquisition and Long-Term Lease (Aliens) (Amendment) Law:
Real and Legal Persons who are registered with the Cyprus Turkish Building Contractors Association and who possess the required annual licence to carry out construction works in accordance with the relevant legislation can form partnerships with real and legal persons of countries which recognise the TRNC and which afford the same rights to TRNC citizens (currently, this means only citizens of the Republic of Turkey) for the purpose of the development and sale of immovable property.
The total foreign shareholding in the partnership must not exceed 49%.
Partnership companies formed in this way can apply to the Ministry of the Interior for permission to acquire immovable property.
Partnership companies established for this purpose are exempt from the provisions of the Immovable Property Acquisition and Long-Term Lease (Aliens) (Amendment) Law.
Purchasers who, prior to the Immovable Property Acquisition and Long-Term Lease (Aliens) (Amendment) Law coming into force, had entered into Contracts of Sale to purchase more than one property have the option, in addition to the existing option under the Law of paying a notification fee of 1% to the Ministry of the Interior and disposing of the property within 24 months of the expiry of the notification period set out in the law, of obtaining a 7-year licence to use and enjoy the property.
This option applies only to purchasers who have purchased houses or apartments and does not apply to the purchase of land.
During the 7-year period, legal title to the property will remain with the seller. However, the purchaser will have the same rights and protection that a purchaser with a registered Contract of Sale would have.
The licence to use the property cannot be revoked during the 7-year period other than on the request of the licencee.
At the end of the 7-year period, the provisions of the Law will apply.
The normal Land Registry transfer fees applicable to foreign nationals will be applied upon the registration of the licence to use.
Purchasers wishing to obtain the licence to use must first pay the registration fees payable on the registration of a Contract of Sale to the Land Registry. The Ministry of the Interior will then conduct a military search in relation to the purchaser and the property. Provided that the result of the military search is positive, the licence to use can be registered at the Land Registry. In the event that the result of the military search is negative, the terms of the Law will apply. In this case, provided that the property is transferred within the period stipulated in the law, any Land Registry fees and taxes paid by the purchaser will be considered as payment of the taxes payable on the transfer and the transfer taxes will be considered paid.
Update 13/11/2024
Guide to new Immovable Property Laws of 21.05.24 (nmplegal.com)
On 21st May 2024, the TRNC Government passed new legislation affecting the purchase of immovable property in North Cyprus. The law affects both new purchasers intending to purchase property in the future and existing purchasers who have already purchased a property prior to the law coming into force. Below is a summary of the main provisions of the law:
Provisions relating to purchasers who have already purchased property prior to the new law coming into force
- Purchasers who have signed a Contract of Sale, but who have not registered their Contract of Sale at the Land Registry:
Foreign purchasers who entered into Contracts of Sale prior to the new law coming into force and who have not registered their Contracts of Sale at the Land Registry are required to register their Contracts at the Land Registry within six months of the date of the new law coming into force. In the event that the Contract of Sale is not registered within this period, the vendor commits a criminal offence and is liable to a fine of up to 500 times the gross monthly minimum wage.
If you purchased a property through us after approximately May 2008, we would normally have completed the registration of the Contract of Sale on your behalf as standard practice as part of the purchase process and, in this case, no further action is required in relation to this point.
If you purchased a property through us on or before approximately May 2008, we would have attempted to contact you in 2008 when the legislation enabling the registration of Contracts of Sale at the Land Registry came into force. If we did not receive the necessary paperwork and instructions from you to register your Contract at that time, your Contract of Sale might not be registered at the Land Registry. In this event, you will need to arrange for your Contract of Sale to be registered at the Land Registry within the six-month period stipulated in the law.
- Purchasers who have not yet applied for Permission to Purchase:
Foreign purchasers who purchased a property prior to the new law coming into force, but who have not applied for their permission to purchase, must apply for permission to purchase (up to the maximum entitlement which they are permitted to acquire under the law) within six months of the date of the new law coming into force. In the event that application for permission to purchase is not submitted within this period, the purchaser commits a criminal offence and is liable to a fine of up to 500 times the gross monthly minimum wage.
If you have purchased a property, but your permission to purchase application has not been submitted or you have received emails from us reminding you to provide your police certificate or any other paperwork in order for us to submit your application for permission to purchase, please contact us urgently in order to ensure that your application is submitted within the stipulated period.
- Purchasers who have applied for Permission to Purchase and who are currently waiting for this to be granted:
Under the new legislation, foreign purchasers must complete their transfer of title within six months of their permission to purchase being granted by the Ministry of the Interior. In the event that a purchaser does not complete their transfer of title within this six-month period, their permission to purchase will be void.
However, if, at the time that the permission to purchase is granted, there are still ongoing payments to be made by the purchaser under the terms of the Contract of Sale, the six-month period will start to run from the date on which the final payment is made. In this event, both the purchaser and the vendor are required to pay their transfer of title taxes within sixty working days of the permission to purchase being granted in order to avoid the permission to purchase becoming void.
In the event that permission to purchase becomes void as a result of the purchaser not having completed the transfer of title within the six-month period, then, if the purchaser wishes to re-apply for permission to purchase, the purchaser will be liable to pay a re-submission fee which will be double the amount of the normal application fee. If the purchaser fails, once again, to take title within six months of this second permission to purchase being granted, a third application by the same purchaser(s) in respect of the same property will not be accepted by the Ministry.
If you have already purchased a property through us and have registered your Contract of Sale at the Land Registry, but are currently still waiting for your permission to purchase to come through, we will notify you once we have confirmation that your permission to purchase has been granted and provide you with information and instructions in relation to the transfer of title.
- Purchasers who have received Permission to Purchase, but who have not yet taken title
Purchasers whose permission to purchase was granted prior to the new legislation coming into force, but who have not yet taken title must take title within six months of the date on which the new law came into force. Failure to do so will result in the permission to purchase being void and the registration of the Contract of Sale at the Land Registry will also be void. In addition, the purchaser and vendor will commit a criminal offence and are liable, upon prosecution, to a fine of up to 500 times the monthly minimum wage.
However, in the event that it is not possible for the transfer of title to be carried out within this six-month period due to the fact that the final approval of the property has not been obtained or the individual title deeds have not been issued, both the purchaser and the vendor are required to pay their transfer of title taxes within sixty working days of the permission to purchase being granted in order to avoid the permission to purchase becoming void.
If you have already received your permission to purchase and you have made all of your contractual payments and your property has individual title deeds, you must contact us urgently to discuss the arrangements for completing your transfer of title within the stipulated period.
If you purchased your property from a construction company and have received your permission to purchase, but are unable to take title due to the fact that you still have ongoing contractual payments to make and/or your property does not have final approval and/or individual title deeds, you will need to contact the construction company to arrange with them for the taxes payable by both parties to be paid within the stipulated period of sixty working days.
If you purchased your property from a private individual and have received your permission to purchase, but are unable to take title due to the fact that you still have ongoing contractual payments to make and/or your property does not have final approval and/or individual title deeds, please contact us to make arrangements for the taxes to be paid within the stipulated period of sixty working days.
- Purchasers who have purchased more than one property in their name
Foreign purchasers who, prior to the new legislation coming into force, had purchased more property than they are entitled to purchase under the new legislation must notify the Ministry of this situation within six months and must pay a fee upon notification of 1% of the Contract price.
If the Ministry is not notified within this period, the fee payable on notification after this date will be 3% of the Contract price.
Such purchasers will then have twenty-four months from the expiry of the six-month notification period to transfer these Contracts of Sale out of their names.
Any Contracts of Sale which are not harmonised with the law within this period will be void.
On the transfer of any Contracts of Sale in this way, a fee of half of the amount of the capital gains tax (stopaj) payable by the seller will be payable.
In the event that such Contracts of Sale are not transferred or harmonised with the new law in this way within this period the purchaser and the seller commit a criminal offence and are liable to a fine of up to 500 times the gross monthly minimum wage.
If you have purchased more properties than you are entitled to purchase under the new law, please contact us to discuss the arrangements for notifying the Ministry and for transferring the excess properties.
Provisions relating to Trust Agreements
From the date of the new legislation coming into force, non-citizens are no longer permitted to enter into trust agreements to purchase more properties than they are entitled to purchase under the law. In the event that a trust agreement is entered into in order to enable a non-citizen to acquire more property than they are entitled to acquire under the law, the parties to the agreement commit an offence and are liable to a fine of up to 500 times the gross monthly minimum wage.
Any trust agreements which were entered into before the date on which the new legislation came into force must be registered at the Land Registry within 75 days of the new legislation coming into force. Any such agreements which are not registered within this period will be void. In addition, the purchaser and seller commit a criminal offence and are liable to a fine of up to 500 times the gross monthly minimum wage.
If you purchased a property using a trust company, you must contact the operators of the trust company to discuss the arrangements for registering the trust agreement at the Land Registry within the stipulated time period.
If you entered into a private trust agreement with a family member/friend, please contact us to discuss the arrangements for registering the trust agreement with the Land Registry.
Provisions relating to new purchasers
Purchasers intending to purchase property in North Cyprus after the introduction of the new law are now subject to the following rules:
From the date of the new legislation coming into force, non-citizens can purchase the following:
- In the case of vacant land one single plot up to a maximum area of 1338m2
- In the case of an apartment, one single apartment (or three apartments in the case of citizens of the Republic of Turkey)
- In the case of an individual house, one single house with a plot size of no more than 3300m2
Foreign purchasers cannot purchase agricultural or forestry land.
Anyone who carries out any procedure in excess of the acquisition rights set out in the law commits a criminal offence and is liable to a fine of up to 500 times the gross monthly minimum wage.
From the date of the new legislation coming into force, non-citizens are no longer able to purchase properties which have shared title deeds. However, if the property is an apartment or individual house, this can be purchased by up to three co-owners on a shared title basis.
In addition, the sale and transfer of any properties which do not have individual or storey easement title deeds (known as ‘Kat İrtifak Koçanı’ in Turkish) is no longer possible. Contracts of Sale for any such properties would be considered void.
Anyone who sells property which has shared title to a non-citizen or anyone who makes a Contract of Sale in relation to a property which does not have an individual or storey easement title deed or anyone who carries out or assists in the carrying out of the sale or transfer of a property which does not have an individual deed or storey easement deed commits a criminal offence and is liable to a fine of up to 500 times the gross monthly minimum wage.
In the case of new developments which do not already have building permits in place or in respect of which building permits have not already been applied for prior to the law coming into force, a minimum of 20% of the units must be sold to nationals of the TRNC or the Republic of Turkey and no more than half of the units can be sold to first degree foreign purchasers who are first degree relatives of each other or to foreign purchasers of the same nationality.
No more than 7% of the land area of each area and no more than 3% of the land area of the whole country can be sold to non-citizens.
The Ministry of the Interior has the right in situations where there are any concerns around national security, public interest and public order, to publish a directive in the Official Gazette, declaring that non-citizens cannot acquire (other than by way of inheritance) property in a particular area stipulated in the directive.
Previously, it was the case that companies which had a majority of TRNC citizens as the shareholders and directors were considered ‘local companies’ and were not subject to the restrictions on the purchase of property. However, under the new legislation, any company in which any shares are owned by non-citizens and/or in which the majority of the directors are non-citizens and where the majority of the voting rights are in the hands of persons acting on behalf of foreign nationals are now considered to be ‘foreign companies’ and are subject to the restrictions set out in the new law in relation to the acquisition of property.
All new Contracts of Sale entered into after the date on which the new legislation came into force must be registered at the Land Registry within seventy-five days, otherwise they will be void.
Landmark Estates disclaimer
While the information within this website site is periodically updated, no guarantee is given that any information provided in this website will be correct, complete, and/or up-to-date.
All materials are provided for general information purpose only and do not constitute any legal or other professional advice on any subject matter. Landmark does not accept any responsibility for any losses which may arise from reliance on any information contained on this site.
