Purchase Tax

[kizzie]

Does anyone know whether you should pay purchase tax on the amount that you purchase a property for (in 2009) or on the value of the property when the first purchaser bought in 2006 which was declared at a high price.   

We are being charged £2,500 tax for a property we have bought for £39,000.  Surley it should only be for what we paid for it.  Any help would be appreciated. 

Linkback: https://www.enjoykalkan.com/forum/index.php?topic=5115.0

[mark]

It seems high to me.  I think I paid 3% purchase tax.  However, there are other costs (notary, solicitor, translation).  And, if it is a new build there might be Electricity connection.  Some were a surprise to me at the time, but whoever is supporting you should give you a proper breakdown.  BTW, you might want to google 'property purchase turkey' to get more information.

Mark

[Kalkan regular]

Purchase tax is 3% and is usually split between the seller and the buyer. 3% of £39000 is £1170 (£585 each) so £2500 is way of the mark unless there are other things included. Get the breakdown in writing before you pay anything.
If you are buying through an agency they usually charge the buyer and seller 3% each for having sold the property. It is possible that you are being charged 3% tax and 3% agency fees.

[Kalkan Magic]

i don't think it is split - i believe it is 3% to be paid by the seller and 3% to be paid by the buyer.

[kizzie]

Have already paid the 3% commission to the agent.  The agent is saying that he found out today in the Town Council that in 2006 the value of the apartment was shown from such a high price (when the seller bought it) and since then of course every year valuation goes up, and when you are doing the sale you cannot show under Town Council's valuation, otherwise in future you can get fined by the tax office and this has resulted in an increase. 

This really does not make much sense to me  Many thanks for your help

[JayTravel]

movers

Does anyone know whether you should pay purchase tax on the amount that you purchase a property for (in 2009) or on the value of the property when the first purchaser bought in 2006 which was declared at a high price.   

We are being charged £2,500 tax for a property we have bought for £39,000.  Surley it should only be for what we paid for it.  Any help would be appreciated.

Thanks for asking this question.  I thought it was 3% but needed clarification.  I'm coming form the US and this seems like a very low amount as a result.  I guess that's how you attract buyers though.

[Rosie]

Kizzie

Your agent's explanation for the tax doesn't make sense to me either.

If I understand you correctly, the agent is saying to you the value of your property is actually lower than the value registered it at the time of the original sale to your vendors, thus it is incurring fines from the local tax office. If this is the case, then what happens if the property market were to completely crash, does this mean that hundreds of property owners will incur fines because their values have gone down below the original valuation?!

Have you enquired as to why the property was valued so high in the first place and who valued it? Was the correct sale price registered when your vendors bought it?

It is ludicrous for the local tax office to expect the value of property to go up every year, because this is simply not the case with property, there are so many factors influencing property values and each should be on its own individual merit.

One thing wasn't quite clear to me in your post - who is the beneficiary of this additional charge, is it the agent or the local tax office? Have you engaged a solicitor, it may help explain the legal requirements more easily. My advice would be to do a bit more 'digging' before paying up.

Rosie

[Javonnah]

Hi,
In my point of view, it is 3% to be paid by the seller, and 3% to be paid by the buyer.

[alantj]

The problem is that valuations are pretty much always works of fiction. The valuation and from this the amount of tax to be paid is agreed in discussion with the local taxman.

After you reach an agreement this is confirmed over a cup of tea and cannot then be challenged.

The tea is clearly very good tea as it costs around 150TL a cup, although not being a connoisseur of  Turkish tea it seemed pretty ordinary to me.

This system works well for sellers when prices are going up, as the amount of tax you have to pay is pretty reasonable. Of course when prices go down its not so good as you could lose money on the sale but still end up paying tax. 

NB The 3% paid by the buyer and seller is the estate agents fee not a tax. like everything else it is negotiable. When we purchased the estate agent agreed to waive the 3% to clinch the deal. 


 
   

[Tinkabell]

Please don't forget the now 3.3% purchase tax payable everytime the property changes hands. This is NOT commission but payable at the Tapu office everytime the official owners name changes on the deeds (Tapu). Normally buyer and sellers split the amount between each other however sometimes the purchaser is asked to pay the full amount. Also there are charges with the local Belidiye of I believe around 400 TL for changing billing names ie water etc.