hb
Junior Member
Posts: 22
|
Post by hb on Jan 31, 2008 15:36:12 GMT 1
Hi,
I may be a bit confused but if you buy a property through a company, do you still have to pay the 5% Transfer Tax? I thought I read somewhere that you didn't.
|
|
|
Post by eucomis1 on Jan 31, 2008 22:17:35 GMT 1
If the company buys the property from an individual or another company, then you must pay the 5% tax on the sale. Perhaps the article might have been referring to a situation where Company X already owns a property (and has paid the tax on purchase), the property is the only asset of Company X, and all the shares in Company X are then sold to another party. In that case, the owner of the property remains the same (i.e. Company X)and so there is no liability.
|
|
|
Post by Carol on Jan 31, 2008 22:20:21 GMT 1
If a property is sold - whether to a company or to a private person, then RETT is due. The only exception is when the property is a new build being sold for the first time from a PDV registered developer.
You are thinking of when a company is sold then there is no 5% RETT even if the company owns a property.
If RETT is due, then its always the buyer who pays it.
|
|
|
Post by Carol on Jan 31, 2008 22:21:21 GMT 1
EUCOMIS1 - looks like we are typing simultaneously, but you type quicker! At least we agree the answer.
|
|
|
Post by mirabelle on Jan 31, 2008 23:14:06 GMT 1
Hello Carol RETT from new build PDV reg. developer. Do you refer to RETT only being due on the LAND part of the total sale price (defined in contract - let's say)? Or do you mean none is due at all? And what is import of PDV reg. developer? Is that coz PDV not applicable to said Land value?
|
|
|
Post by Carol on Feb 1, 2008 9:33:21 GMT 1
In the case of new builds, the land is not being sold for the first time ever (obviously!), so there is no PDV on the land portion. Instead RETT is due on the land portion.
However if the property was built with the developer reclaiming PDV for labour, materials etc then when he sells the thing he has made i.e. the building he has to pay the government PDV on the sale price.
Obviously this means that the cost is either 22% higher or the developers profitability is much reduced. So most developers avoid this sitation by registering the property to a family member who does not meet the PDV threshold. Or they don't think about it all, until its too late and then i get an email from them saying "by the way, I want another 22% on top of those prices I gave you". Either way its not the buyer's problem as its the developer who will get the tax bill for the PDV.
|
|
hb
Junior Member
Posts: 22
|
Post by hb on Feb 1, 2008 11:50:08 GMT 1
Thanks to everyone who took the time to answer. Much appreciated. Better look for another 5% then!!!
|
|
|
Post by francis on Jul 23, 2009 13:36:35 GMT 1
Transfer tax You do not have to pay transfer tax, on land if in ex war zone, But must the company, be Reg in a address in that zone?? or dose it matter where, the company is Reg? would be grateful for any help in this matter
|
|