REALWorld Law

The purchase of a real estate in Angola is subject to transfer tax (SISA) as well as stamp duty.

The purchase of a real estate is subject to SISA at a rate of 2 percent (levied on the acquisition amount when equal to or higher than the value registered in the land register). Additionally, it is also subject to stamp duty at a rate of 0.3 percent (levied on the acquisition amount). Stamp duty is also due for the execution of a sale and purchase deed at a fixed amount of AOA2,000.

The first transfer of a property (as long as the price is below a certain threshold) may be exempt from SISA as long as the property is exclusively for personal and permanent residence purposes. Long-term leases (exceeding 20 years) also trigger the payment of SISA, as well as the execution of a promissory sale and purchase agreement, which includes the transfer of use.

The purchaser is responsible for the payment of the SISA and stamp duty.

Typically, share deals do not trigger the payment of SISA. However, in the event that the purchaser ends up holding more than 50 percent of a company holding real estate and does not prove that the main purpose of the operation is not the acquisition of the immovable properties then SISA is due.

The acquisition of real estate does not directly impose tax on the buyer, as it does Income Tax. It may be taxed on the seller, affecting the operation. See below Tax on Disposals.

Stamp Tax is a provincial tax, and it is levied on the instrumentation of acts, contracts, and transactions of onerous nature executed within a certain provincial jurisdiction or outside a certain provincial jurisdiction but with effects in such jurisdiction.

The instrumentation of a purchase of real estate will be taxed by Stamp Tax. The tax rate ranges from 0.75% to 3.6% depending on the province. The tax is paid by the buyer and the seller in equal parts. All parties are severable and jointly liable for the lack of payment or compliance with this tax.

No transfer tax is to be paid by the parties in none of the various types of foreign corporate vehicle available for the purchase of real state unless the purchase of real state was an asset that was acquired before to 2018 by the which transfer tax must be paid resulting of an approximate tax range of 1.5%.

Stamp duty is payable in all Australian States and Territories on the purchase of Australian real estate, including the following types of duty:

• Transfer or conveyance duty (up to 7 percent) on the purchase of real estate, which is generally payable by the purchaser. The amount of duty will depend on the dutiable value of the real estate (the greater of its unencumbered value and the consideration paid) and the Australian State or Territory in which the property is located. Foreign purchasers of residential property (including residential development sites) may be subject to foreign purchaser additional duty in Victoria (at 7 percent), New South Wales (at 4 percent) and Queensland (at 3 percent), which is payable in addition to the standard rates of transfer/conveyance duty payable.
• South Australia has announced a three-year phase out of conveyance duty on non-residential, non-primary production real property which commenced from 7 December 2015.
• Landholder duty (up to the same rates as transfer/conveyance duty) may be payable by the purchaser on the acquisition of a significant interest in an entity that holds Australian real estate (ie indirect acquisitions) depending on the Australian State or Territory in which the property is located and the value of the real estate owned by the entity. Duty is generally payable by the purchaser, but in certain circumstances the entity itself can become liable to the duty.

Goods and Services Tax (GST), similar to VAT in Europe, of 10 percent may also be payable.

Sale of shares

The sale of shares in a company holding real estate will normally not be considered to be a sale of the real estate itself. No transfer tax (VAT or registration duties) is therefore due. Existing anti-abuse rules should, as a general rule, not affect share purchases. Exceptionally, certain share deal structures could possibly fall within the scope of these measures.

Sale of real estate assets

The transfer of ownership or the disposal of real estate interests in Belgium is either subject to registration duties or to VAT. These two taxes do not apply cumulatively.

A 12.5% registration duty is generally payable by the buyer and calculated on the basis of the contractual price or the market value, whichever is higher. From 2022, a distinction is made in the Flemish region between the purchase of the only owner-occupied home (where the registration duty is reduced from 6% to 3%) and the purchase of a home other than the only owner-occupied home (where the registration duty is increased from 10% to 12%. Reduced rates and exemptions may apply in function of the nature of the buyer and the type or size of the property.

A reduced rate (4% in the Flemish region, 5% in the Walloon region and 8% in the Brussels region) is available for professional buyers provided that certain conditions are met, among which the obligation to buy and sell a number of properties within a certain period of time.

Restitution of paid registration duties can be obtained if a property is re-sold within two years as from the signature of the notarial deed of acquisition. The amount to be recovered depends on the region where the property is located, (36% in the Brussels region and 60% in the Flemish and the Walloon Region).

Where a company finances the purchase by a loan, a mortgage may be created over the property. The following indirect taxes are payable upon the registration of a mortgage:

• 1% registration duty calculated on the amount of the guaranteed debt
• 3% mortgage tax calculated on the same basis

In the Federation of Bosnia and Herzegovina, the sale of real estate is taxed at a level set by each canton individually.

The tax rate is usually 5 percent of the value of the real estate, as determined by the appraisal team for the municipality. This tax is paid usually by the buyer and cannot be reduced.

The Onerous Transfer Tax of Real Estate (ITBI) is a municipal tax levied on onerous transfer of properties, whether urban or rural, based on a percentage − usually around 2%, but varying from municipality to municipality − of the transaction value or the property value defined by the municipality, whichever is higher.

The purchaser of the property has to pay ITBI.

ITBI is not due when the real property is acquired through a share deal, that is, when the purchaser buys the company that owns the property.

Although ITBI is not generally due when a company’s share capital increased through  the contribution of a real property, it will be due if the company mainly carries out real estate activities, such as the purchase, sale and leasing of real estate. Additional taxes such as capital gains tax and corporate income tax may be due by the seller and are not included in the analysis of this topic.

No Canadian federal or provincial income tax applies to the acquisition of real estate.

Certain provinces levy tax on the registration of an interest in real property in the relevant provincial land titles office. At least one Canadian city, Toronto, levies a similar registration tax in addition to the provincial tax. Ontario levies an additional 15% registration tax on foreign purchasers of residential real estate in the Toronto region, and British Columbia levies an additional 20% registration tax on foreign purchasers of residential real estate in the Vancouver region and in certain other specified areas in British Columbia.

Property transfer

In a property transfer, the taxes paid by the purchaser of real estate are as follows:

• Deed Tax: 3 to 5% of the purchase price, and
• Stamp Duty: 0.05% of the purchase price

Individual buyers may enjoy a favourable deed tax rate or be exempted from paying the stamp duty provided that required conditions have been satisfied.

In a property transfer, the taxes payable by the seller of real estate are as follows:

• Stamp Duty: 0.05% of the purchase price
• Land Value Added Tax: Progressive scale ranging from 30% to 60% depending on the amount of taxable gains derived from the transfer of real property
• Value Added Tax: 9% of the gross sales proceeds which will be passed through to the purchaser to pay. If the real estate properties were acquired by the seller before 30 April 2016, the seller may opt for a simplified tax method, ie apply a reduced VAT rate of 5% on the gross sales proceeds which will be borne by the seller itself, and
• Income Tax (for enterprise): 25% of net profit (consolidated with the enterpriseʼs annual profit)

Share transfer

In a share transfer, the taxes paid by a purchaser of a real estate company are as follows:

• Stamp Duty: 0.05% of the share transfer price

In a share transfer, the taxes paid by a seller of a real estate company are as follows:

• Stamp Duty: 0.05% of the share transfer price
• Income Tax (for enterprise): 25% (consolidated with the enterpriseʼs annual profit and foreign enterprises not maintaining establishments in China are taxable on their income and gain on a gross withholding basis at the rate of 10%)
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From 1 January 2015 any acquisition of a building and/or a development site from a VAT payer is subject to VAT at the rate of 25%. This rule applies to buildings, which are new, ie have not been in use since their construction and buildings in respect of which the time elapsed since their first use up to the sale is two years or less. Acquisitions of “old” (used) buildings, ie those which do not fall into the above categories, are subject to land transfer tax unless both parties (being VAT payers) agree on VAT and reverse charge. Acquisitions of land which is not a development site are either subject to VAT (if the buyer is also a VAT payer and both the seller and the buyer agree to apply VAT) or land transfer tax. VAT is paid by the buyer.

Acquisition of real estate assets that are not subject to VAT are subject to real estate transfer tax at the rate of 4% (since 1 January 2017). Real estate transfer tax is payable on the market value of the property and the tax authorities have the right to perform their own assessment of this if appropriate. Generally, real estate transfer tax is paid by the buyer. However, the seller is also a guarantor for the payment.

Exemptions from real estate transfer tax (if applicable) apply in the following cases:

• A transfer of real estate made as a contribution to the registered capital or to the capital reserves of a company.
• A transfer of real estate owned by a company as part of a merger, division or restructuring process.

Real estate cannot be contributed to the share capital of a closed end real estate investment fund, so this exemption from real estate transfer tax does not apply to these funds.

Transfers of real estate are, generally speaking, subject to VAT and income tax. The real estate acquisition tax has been cancelled in 2020.

Besides the taxes mentioned above, Czech law provides for two other types of real estate tax payable annually, consisting of tax on land and tax on buildings or "units" (ie flats and retail units).

There are no taxes on the purchase of real estate in Denmark (please see below on registration fees).

Generally, the purchase of property is subject to transfer taxes or value added tax (VAT) at the standard rate (20%) depending on whether the seller and the buyer are VAT taxpayers or not.

The VAT tax regime complies with EU directives. As a general rule, real estate properties are placed within the scope of the VAT standard regime and no longer subject to a specific regime.

The following rules apply to transactions entered into by a French SPV (registered for French VAT) and a seller registered for VAT:

• · Transactions involving non-developable land are exempt from VAT (unless an election for VAT to be payable is filed in which case the VAT is due on the total purchase price) and are subject to transfer tax at a rate between 5.09% and 6.40%, depending on the type and location of the land. A reduced rate of 0.715% applies if an undertaking to re-sell the land within five years is made by the buyer.
• Transactions involving developable land are subject to VAT on the total price where VAT on the acquisition cost was deducted when the land was acquired by the seller and are subject to transfer tax at a rate of 0.715 % (or a fixed fee of €125 if the buyer intends to erect a building on the land, provided that the buyer undertakes to complete the construction works within four years and complies with the undertaking). Where VAT on the acquisition cost was not deducted when the land was acquired by the seller VAT is payable by the seller on any capital gain realized. In addition, transfer tax is payable at a rate between 5.09% and 6.40%, depending on the type and location of the relevant property (or a reduced rate of 0.715% if a commitment to re-sell the land within five years is made by the buyer, or a €125 fixed fee if the buyer intends to erect a building on the land, provided that the buyer undertakes to complete the construction works within four years and complies with the undertaking).
• · Transactions involving new buildings for VAT purposes (ie a building is considered as "new" for VAT purposes when it is acquired less than five years after its completion from a VAT-liable entity acting as such. Moreover, pursuant to Article 257-I-2-2° of the French Tax Code, works carried-out on an existing building consisting of an increase in height (surélévation) or a refurbishment (remise à l'état neuf) is assimilated to the delivery of a new building, subject to certain conditions), including transaction involving a new property known as a ‘sale before completion’ (Vente en l’état futur d’achèvement), are subject to VAT on the total purchase price and to transfer tax at 0.715% (or a fixed fee of €125 if the buyer intends to erect a building on the land, provided that the buyer undertakes to complete the construction works within four years and complies with such undertaking).
• Transactions involving other properties are exempt from VAT (unless an election for VAT to be payable is filed, in which case the VAT is due (i) on the total purchase price if the VAT incurred by the seller on the initial acquisition was deducted or, (ii) on the margin if the VAT incurred by the seller on the initial acquisition was not deducted and are subject to transfer tax at a rate between 5.09% and 6.40%, depending on the type and location of the relevant property (or a reduced rate of 0.715% if the buyer commits to re-selling the property within a five-year period, or a fixed fee of €125 if the buyer commits to erect a building within a certain period).

Please note that, regardless of the buyer's registration in France for VAT, if the seller is not registered for French VAT, the transaction is not subject to VAT. Transfer taxes are due at the 5.09% to 6.40% normal rates specified above, unless the buyer is indeed registered for French VAT and undertakes either to re-sell or to erect a building (see the specifics above about these undertakings).

The transfer tax regime also differs if the seller is registered for VAT in France but the buyer is not: in this case, the benefit of the reduced rates of transfer taxes subject to the above mentioned undertakings are not available.

Furthermore, notary fees are due at a rate of 0.799% on the sale's price. It is generally due by the buyer.

The sale of shares in a company holding real estate (where the value of the real estate represents more than 50% of the company’s assets) is subject to a transfer tax of 5% of the price paid for the shares or the fair market value if higher.

Moreover, transactions involving real estates or rights on real estates are subject to a real estate security contribution (contribution de sécurité immobilière) of 0.10% of the price paid for the real estate or for the rights on real estates.

Real estate transfer tax

A real estate transfer tax of 3.5 percent to 6.5 percent, depending on the German federal state in which the property is located, is generally payable on real estate transactions in Germany.

Direct investment

Real estate transfer tax applies to the direct purchase of a real estate asset, or to the grant or transfer of transferable building rights (Erbbaurechte). All parties involved in the real estate transfer agreement are generally liable for this tax, although the seller will normally insist on a clause which makes the buyer responsible for paying it.

Indirect investment through a partnership (a transparent entity)

The transfer of an interest in a partnership holding real estate triggers real estate transfer tax if 90% or more of the partnership interests are transferred within ten years. The partnership is liable for paying the real estate transfer tax. Irrespective of this ten-year period, real estate transfer tax becomes due if at least 90% of the partnership interests are directly or indirectly held by one entity or individual for the first time.

There are strategies available to avoid real estate transfer tax eg if the seller remains as a partner in the partnership, holding a stake of more than 10% for more than 10 years and provided further that the purchaser directly or indirectly does not acquire more than 89.9% of the interest in the partnership.

Indirect investment through a corporation

The acquisition of real estate via a corporation triggers real estate transfer tax if at least 90% of the shares are held by one entity, individual, or group of related entities or individuals for the first time. The entity, individual or group holding these shares is liable for the real estate transfer tax. Again, indirect transfers or concentrations of shares have to be taken into account in principle.

As of January 2010 a new rule (§ 6a Real Estate Transfer Tax Act, RETTA) was introduced into the law which allows in certain circumstances an exemption from real estate transfer tax where there is a restructuring within a group of companies.

Potentially, there are strategies available to avoid real estate transfer tax, eg if a company is acquired by two independent buyers.

Notification duties

An amendment of the German RETT rules in December 2022 means that timely RETT notification is of high importance. Generally, a RETT notification must be filed by the parties with the competent tax authority within two weeks (or one month, if applicable) after signing. A second RETT notification must be filed within two weeks after closing. If the notifications are not filed in a timely matter or not filed at all, a double-RETT burden may arise.

Stamp Duty

The obligation to pay stamp duty rests on both the vendor and purchaser but the commercial practice in Hong Kong is that the purchaser will usually be responsible for paying it. The amount to be paid depends on the consideration/market value of the property at the time of the purchase. Payment should be completed within 30 days after the execution date of the agreement for sale or conveyance on sale for the acquisition of both residential and non-residential property.

Under the Stamp Duty Oridnance, for any sale or transfer of immovable property, such transaction may be subject to ad valorem stamp duty (AVD) rates at Part 1 of Scale 1, Part 2 of Scale 1 or Scale 2 depending on the nature of the transaction. A summary of the Scale 1 AVD and Scale 2 AVD rates can be found on the Hong Kong Government website here.

Any instrument executed on or after 5 November 2016 for the sale or acquisition of any residential property or the conveyance on sale of any residential property is subject to 15% of the consideration or value of the property (whichever is higher) (i.e. Part 1 of Scale 1), unless specifically exempted or otherwise provided as described below.

For non-residential property, the Stamp Duty Ordinance was amended in 2020 to revert the AVD rates from the rates under Part 2 of Scale 1 to the rates under Scale 2. Following the passing of the Stamp Duty (Amendment) Ordinance 2021, deemed to be effective from 26 November 2020, unless otherwise provided, any instrument executed on or after 26 November 2020 for the sale and purchase or transfer of non-residential property will be subject to AVD at the Scale 2 rates, while any instrument executed on or after 23 February 2013 but before 26 November 2020 for the sale and purchase or transfer of non-residential property remain to be subject to AVD at the Part 2 of Scale 1 rates.

To ease the burden on buyers purchasing small- and medium-sized properties and car parking spaces, especially first-time home buyers, in February 2023 the Hong Kong Government has further proposed under the Public Revenue Protection (Stamp Duty) Order 2023 to adjust the value bands of the Scale 2 AVD rates payable for sale and purchase or transfer of both residential and non-residential properties. With effect from 22 February 2023, the Scale 2 ADV rates payable for sale or transfer of residential and non-residential properties starts at HK$100 for properties worth up to HK$3 million, instead of HK$2 million under the original Scale 2 rates, and a higher 3.75% rate, which used to kick in for properties worth more than HK$6 million and up to HK$20 million, now only applies to properties worth more than HK$10 million.

The purchaser and the vendor continue to be jointly and severally liable to pay AVD.

There are a number of exceptions to the application of the 15% AVD rates (in which case, the Scale 2 AVD rates apply instead):

• an acquisition of a residential property by a Hong Kong Permanent Resident (HKPR) who does not own any residential property in Hong Kong on the date of acquisition and is acting on his/her own behalf;
• two or more HKPRs acquiring a residential property jointly, where each purchaser is acting on their own behalf and do not own any residential property in Hong Kong on the date of acquisition;
• a joint acquisition of a residential property by a HKPR and a close relative (ie spouse, parents, children, siblings) who is/are not HKPR(s) where each purchaser is acting on their own behalf and do not own any residential property in Hong Kong on the date of acquisition;
• an acquisition or transfer of residential property between close relatives (whether HKPRs or not) who may or may not own any residential property in Hong Kong;
• nomination of a close relative(s) (whether HKPR or not) who own other residential property in Hong Kong at the time of nomination, to take up the assignment of a residential property;
• an acquisition or transfer of a property by court order or pursuant to a court order, including a foreclosure order;
• a transfer of a mortgaged property to a mortgagee which is a financial institution within the meaning of section 2 of the Inland Revenue Ordinance (Cap. 112 of the Laws of Hong Kong) or to its appointed receiver; or
• an acquisition of a property as replacement of another property that was acquired under various statutory schemes for urban redevelopment where the person is acting on his/her own behalf.

Additionally, AVD does not apply in the following cases (in which case, no AVD is payable):

• nomination of a close relative(s) (whether HKPR or not) who do(es) not own any other residential property in Hong Kong at the time of nomination;
• transfer of a property to a beneficiary of the estate of a deceased person in accordance with a will or the law of intestacy;
• the acquisition or transfer of a property by or to a body corporate from an associated body corporate;
• the acquisition or transfer of a property by or to the Government; or
• a gift of a property received by a charitable institution exempted from tax under section 88 of the Inland Revenue Ordinance.

For sale or transfer of residential properties, a HKPR purchaser who changes his/her single residential property would normlally be entitled for partial refund of AVD under the refund mechanism. Upon paying AVD at 15% rate and satisfying conditions for partial refund, he/she may seek a refund of AVD paid in excess of that computed under Scale 2 rates.

HKPRs mainly include holders of valid Hong Kong Permanent Identity Cards as defined under the Registration of Persons Ordinance (Cap. 177 of the Laws of Hong Kong). This definition also extends to Buyer's Stamp Duty (see below).

Buyer's Stamp Duty

The government of Hong Kong has introduced Buyer's Stamp Duty (BSD) which took effect on 27 October 2012. Unless exempted, BSD is imposed on all residential properties acquired on or after the effective date by any person (including a company incorporated) other than a HKPR. It is charged at a flat rate of 15% on the stated consideration or the market value of the property (whichever is the higher), and is payable in addition to the AVD and special stamp duty (please see section on ‘Special Stamp Duty’ below), if applicable.

The buyer or the transferee is liable to pay the BSD within 30 days after the execution of the chargeable document (eg a provisional agreement of sale and purchase). If the time for stamping of any instrument chargeable with BSD falls before the amended Stamp Duty Ordinance (SDO) was published in the Gazette (ie 28 February 2014), that time for payment is to be replaced by a period of 30 days commencing immediately after the date of Gazette (ie on or before 30 March 2014).

BSD will be exempted in a number of situations. Below are the circumstances in which the Government will grant an exemption:

(i)     acquisition by a HKPR jointly with a close relative(s) (ie spouse, parents, children, brothers and sisters) who is/are not HKPR, where each of the purchasers is acting on his/her own behalf;

(ii)    transfer of property to a close relative who is not a HKPR, or to close relative(s) jointly one or more of whom not being HKPR, where each of the transferees is acting on his/her own behalf;

(iii)   nomination of a close relative(s) who is/are not HKPR to take up the assignment, where each of the nominees is acting on his/her own behalf;

(iv)    addition/deletion of name(s) of person(s) who is/are not HKPR to/from a chargeable agreement for sale or a conveyance on sale in respect of a residential property if the person(s) is/are a close relative(s) of the original purchaser(s), where each of the persons is acting on his/her own behalf;

(v)     acquisition or transfer by or to a purchaser or transferee by a court order which includes a foreclosure order obtained by a mortgagee whether or not it falls under the definition of a financial institution within the meaning of section 2 of the Inland Revenue Ordinance (IRO);

(vi)    acquisition or transfer of a mortgaged residential property by or to a mortgagee which is a financial institution within the meaning of section 2 of the IRO, or by a receiver appointed by such a mortgagee;

(vii)   acquisition or transfer by or to a body corporate from another associated body corporate;

(viii)  acquisition of residential properties by persons to replace residential properties under various statutory schemes for urban redevelopment where the person is acting on his/her own behalf;

(ix)    acquisition or transfer of residential properties by or to the Government; and

(x)    gift of residential properties to charitable institutions exempted from tax under section 88 of the IRO.

Levy

A HK$350 levy is charged in accordance with the Property Management Services Ordinance and the Property Management Services (Levy) Regulation. Any conveyance on sale as defined under section 2(1) of the SDO that is chargeable with stamp duty under head 1(1) in the First Schedule to the SDO is a leviable instrument. A conveyance on sale generally means each conveyance whereby any immovable property, upon the sale thereof, is transferred to, or vested in, a purchaser. 

The transferee (generally the purchaser) of a leviable instrument is liable to pay the levy. If there is more than one transferee under the instrument, all transferees are jointly and severally liable to pay the levy.

The levy is payable within 30 days after the leviable instrument is executed, which is the same as the timeframe for stamping. 

The acquisition of real estate in Hungary as part of a purchase, exchange or similar transaction is normally subject to real estate transfer tax, payable at 4% of the market value. A reduced rate of 2% applies to the value above HUF1 billion. Nevertheless, the transfer tax payable cannot exceed HUF200 million per real estate. The tax authority will normally accept the consideration stated in the transfer agreement as the market value unless it is obviously too low.

The main exceptions to the general transfer tax rate are:

• a 2% rate applies to the purchase of property by Hungarian real estate funds;
  
  
• a 2% or 3% rate applies to the purchase of property by certain property dealers and finance lease providers (providing the property is sold/leased within two years); and
  
  
• a 2% rate applies if the property is purchased by a REIT (real estate investment company) or one of its wholly owned special purpose vehicles.

The acquisition of 75% or more of the shares (including shares held by close relatives, related parties, etc) in a company holding Hungarian real property is subject to transfer tax provided that the balance sheet value of the company's Hungarian real property (or properties) exceeds 75% of the company's total balance sheet value (subject to certain adjustments). In such cases the general tax rate, ie 4% applies. Nevertheless:

• a reduced rate of 2% applies to the value above HUF1 billion, and the transfer tax payable cannot exceed HUF200 million per real estate asset, and
• if the acquirer is a REIT (real estate investment company), a reduced 2% rate applies (regardless of value)

The definition of a company holding Hungarian real property also includes companies which themselves are not owners of real property, but have, directly or indirectly, an equity interest of at least 75% in another company (other companies) owning Hungarian real property. If no adjustment applies as prescribed by the Duties Act, the tax base is the market value of the real property (or properties) owned by the acquired entity (or entities) in proportion to the shares held by the acquirer.

The transfer tax is paid by the buyer.

The direct acquisition of real estate in Ireland by an individual, partnership or a company will give rise to a stamp duty liability. The rate is 7.5% for commercial real estate. The rate of stamp duty on residential real estate is 1% on the first €1 million and 2% on any balance over €1 million. Stamp duty is normally paid by the buyer.

VAT may also be payable at the rate of 13.5% on completion of the transaction where there is a direct acquisition of real estate. This is determined on a case-by-case basis as each property has its own VAT history recording previous usage and the VAT status of the seller. A buyer may be entitled to recover VAT, depending on the buyer's VAT status and the purpose for which the property is used.

The indirect acquisition of real estate in Ireland through the acquisition of shares in an Irish special purpose vehicle company may, in certain cases, be subject to stamp duty at the rate of 7.5% where the shares derive their value wholly or partly from the underlying real estate, which is normally paid by the buyer.

No VAT is payable on the acquisition of shares.

Where there is an indirect acquisition of real estate in Ireland one must consider whether there are any latent gains or losses attached to the real estate. In the case of latent losses, there are certain rules which restrict capital loss buying which must be considered.

The disposal of the real estate may give rise to capital gains tax for the vendor, currently at the rate of 33%, regardless of where the vendor is resident. However, there is a relief from capital gains tax for real estate purchased from 7 December 2011 to 31 December 2014, provided it is held for a specified period. The original holding period was seven years. There was proportionate relief where the property was held for any period longer than seven years, with the relief being lost in its entirety if the property was sold during the initial seven-year acquisition period.

The requisite holding period has been reduced from seven years to four years. The measure has created a three-year period (ie years 4 to 7) in which the property can be sold and benefit from a full exemption whereas if held longer than seven years, only proportionate relief is available.

In order for the relief to apply, the property must be acquired for a consideration equal to the market value of the property (or if acquired from a relative, not less than 75% of the market value on the date acquired). This exemption applies to all persons regardless of how the real estate is acquired, ie individual or corporate.

The disposal of shares in a company which derives its value or the greater part of its value from Irish real estate may also give rise to capital gains tax for the vendor, currently at the rate of 33%, regardless of where the vendor is resident. The relief from capital gains tax in respect of real estate purchased up to 31 December 2014 does not extend to the disposal of shares in a company which derives its value or the greater part of its value from Irish real estate.

Sales of residential real estate made by VAT-liable entities are normally exempt from VAT. Residential sales are only subject to VAT if the seller is a construction company that has procured or renovated the property less than five years before the sale takes place, or after five years, if the construction company opts in the deed of sale for VAT to apply. VAT is payable at the rate of 10% (22% if the real estate is registered as a newly built luxury dwelling).

VAT-exempt residential transactions are subject to the following transfer taxes:

• Registration tax at 9%; and
• Cadastral and mortgage taxes equal to €50 each.

Sales of residential property which are subject to VAT are subject to registration, mortgage and cadastral tax at fixed amounts of €200 for each type of tax.

The sale of commercial real estate (including offices and industrial property and sales of retail properties and hotel buildings separately from any associated businesses) is subject to VAT at the rate of 22% (10% in the case of renovated properties if sold by the entity performing the renovation works) if:

• the seller is a construction company that procured or renovated the property less than five years before the sale; and
• (in any event), if the seller opts in the relevant transfer deed for the VAT tax regime to apply.

Sales of commercial property, whether or not they are exempt from VAT (except where the seller is an individual), are subject to the following transfer taxes:

• Registration tax of €200;
• Cadastral tax at 1%; and
• Mortgage tax at 3%.

For acquisitions of commercial property by Italian real estate investment funds and listed real estate investment companies (SIIQs) the rates of cadastral tax and mortgage tax are halved to 0.5% and 1.5% respectively. Special rules apply to the transfer of property into a real estate fund in exchange for units if the real estate has mostly been leased to tenants.

In the case of retail property or hotels, if any licences or other intangible assets are included in the sale, then the buyer is regarded as purchasing a going concern, since the building is part of a business and the activities on the premises are carried out by means of authorizations held by the owner. The sale of a going concern is not subject to VAT, although registration tax applies as follows:

• real estate – 9% applied to the net value of the property; and
• other assets (not including receivables) – 3% of the net value.

The sale of real estate as a going concern is subject to mortgage tax and cadastral tax payable at a fixed amount of €200 each.

Where real estate is acquired by way of shares in the corporate vehicle holding the asset, the transaction is normally VAT exempt. The transfer will, however, be subject to registration tax of €200.

The buyer normally pays the transfer tax, but both the seller and the buyer are liable for the payment and for any assessment by the tax authorities. VAT is also paid by the buyer, who can reclaim it by offsetting the VAT due to the tax authorities against its output operations. In some circumstances, a VAT credit can also be obtained.

EU-resident entities may request a refund of VAT paid if certain conditions are met. If the entity is not resident in the EU then it must register for VAT in order recover any VAT incurred.

Real Property Acquisition Tax (fudosan shutoku zei)

Real property acquisition tax is levied on the acquisition of land or buildings; however, an acquisition by merger of real-estate-owning company is exempt.  The tax base is the value of the real estate listed in the official ledger, which is in many cases lower than the market value.  The tax base can be reduced under the GK-TK or TMK structures when certain requirements are satisfied.  Currently, the tax rate is 3% on land and dwellings, and 4% on buildings other than dwellings.

The designated taxpayer for this tax is the acquirer of the real estate.

Under a plain interpretation of the statute, an acquisition of entrusted real property through TBI is not subject to this tax.  To our knowledge, the tax authorities have not attempted to assess real estate acquisition tax on the transfer of TBI to date.

Registration and License Tax (toroku menkyo zei)

Registration is necessary for an acquisition of real estate or TBI for perfection purposes.  The registration tax is levied on real estate transactions such as the purchase of real estate or the construction of a building.  The registration and license tax for purchase of land, for example, is currently 1.5% of the value listed in the official ledger.  Reduced tax rates can be applicable to a GK-TK and a TMK when certain conditions are satisfied.

Seller and purchaser are both legally subject to registration tax, however, a purchaser often bears the registration tax in practice.

Stamp Tax

Any documents listed in the Stamp Duty Act are subject to stamp tax to the extent it is executed in Japan.  Contracts for the transfer of real estate or land leases are subject to stamp tax.  The tax amount varies depending upon the amount stated in the conveyance or lease document (eg the tax amount is JPY100,000 when the stated amount is in excess of JPY100 million but less than 500 million. Mitigation treatments are not considered.)  Meanwhile, a trust agreement or contract for a TBI transfer is also subject to stamp tax and the tax amount is only JPY200 regardless of the amount stated in the agreement.

Stamp tax is paid by affixing a fiscal stamp on the documents and sealing it with a certified stamp.  Seller and purchaser are both legally subject to stamp tax and the party bearing the cost is often decided by agreement between the parties.

The following indirect taxes may apply where the real estate is acquired directly (an asset deal):

• Value Added Tax (VAT; belasting toegevoegde waarde or btw)
• Real Estate Transfer Tax (RETT; overdrachtsbelasting)

In addition, charges (kadastrale rechten) can be levied by the Land Registry.

RETT can be payable in relation to both asset deals and share deals. Real estate share deals are situations where the company being acquired qualifies as a 'real estate company' namely if at least 50% of its assets consist of real estate (either in the Netherlands or abroad) and that real estate is mainly (70% or more) instrumental in the trading of and/or development of real estate, and 30% of those assets are located in the Netherlands.

RETT is legally due by the buyer. An exemption from RETT may apply newly built real estate or building land is purchased and VAT is payable.

As per 1 January 2023, the rate of the RETT is 10.4% (in 2022: 8%), unless residential property is involved. For residential property (houses, apartments, etc.) the transfer tax is at a rate of 2% (or 0% in the case that certain conditions are met) in order to encourage the buying of houses by individuals.

Goods and Services Tax (GST)

Where taxable supplies consist wholly or partly of an interest in land, that taxable supply will have GST charged at 0%. GST is discussed further under the heading “VAT on an acquisition.”

Residential Land Withholding Tax (RLWT) RLWT applies, up to a rate of 39%, to offshore RLWT persons (broadly, foreign investors holding residential land in New Zealand) that dispose of residential land subject to New Zealand’s “bright-line” test (ie where income is imposed on those persons who acquire residential land on or after October 1, 2015, and who dispose of that land within the applicable bright-line period (ten or five years)).

The vendor’s conveyancer has the primary responsibility to withhold and return RLWT. If the vendor does not have a conveyancer, the responsibility falls on the purchaser’s conveyancer. If the vendor and purchaser are associated persons, the purchaser must withhold the RLWT. RLWT is not a final tax, and those subject to RLWT may file a New Zealand income tax return and claim RLWT as a tax credit against their final income tax liability.

For completeness, a vendor could obtain an RLWT exemption certificate that would mean deduction of RLWT is not required.

Stamp duty / Transfer taxes

There are no stamp duties, registration or transfer-type taxes currently imposed in New Zealand.

The taxes applicable to real estate transfer transaction are: Capital Gains Tax (CGT), Stamp Duties. 

Capital gains realised on the sale of real property is subject to CGT and payable by the seller of real estate. The rate under the Capital Gains Tax Act is 10% of the gains from the sales. In reality, the tax authorities (Federal Inland Revenue Service) decide the amount payable on a ‘best of judgment assessment’ basis which uniformly is about 1% of the value of the property.

It is noteworthy that rollover relief can be claimed where proceeds of disposal are used to purchase a new asset of the same class within 12 months before or after the disposal of the old asset. The classes of the assets eligible for relief include Buildings and Landed property (Class 1 Assets).

Stamp duty is chargeable either at fixed rates or ad valorem (ie in proportion to the value of the consideration) depending on the class of instrument All deeds or instruments for transfers of interests in real property are required to be stamped under the Stamp Duties Act and the purchaser or assignee is responsible for this payment. The Federal Inland Revenue Service (FIRS) assessed rates for stamping of transfer documents for is 1.5% for transactions involving a corporate entity.

A different tax regime and rates apply to transfer transactions where individuals are parties and the rates vary within the 36 States in Nigeria. In Lagos State, the rates payable for CGT and Stamp Duties is currently 0.5% each of the property value.

Stamp duty is normally payable on the transfer of title of real estate located in Norway whether commercial, residential or industrial at the rate of 2.5% of the sale value of the property. Normal arm’s-length conditions apply to calculating the sale value. The transfer of shares in limited liability companies and partnerships owning real estate is not subject to stamp duty. A transfer of real estate through the merger or de-merger of a limited company is, provided certain conditions are met, also exempt from stamp duty.

A minor registration fee of approximately €60 is payable in order to obtain legal protection for the right of ownership.

The buyer is responsible for paying stamp duty and registration fee.

In the case of an asset deal (ie the direct purchase of an interest in real estate by a corporate vehicle or individual), where the seller is not an entity carrying on a business, a 2% tax on civil law transactions (PCC) is due, based on the market value. This is normally the purchase price but can sometimes be assessed at a higher level by the tax authorities using an authorized expert's opinion. The obligation to pay PCC rests with the buyer. If the seller is an entity carrying on a business, value added tax (VAT) is usually payable. Generally, the standard rate of 23% applies. With respect to subsidized housing – a rate of 8% applies.

In principle, VAT charged by the seller can be recovered by the buyer as input VAT (if the purchaser is a VAT taxpayer carrying out transactions which are subject to VAT). If a sale is subject to VAT, PCC is not due. The sale of agricultural land is exempt from VAT (but in such cases 2% PCC is due).

Any sales of real property other than land are exempt from VAT if two years have lapsed since that property's first occupation. However, in some circumstances, the parties may opt for such a transaction to be subject to VAT. Other specific exemptions may apply.

If a sale is exempt from VAT, it is subject to tax on civil law transactions (PCC) at a rate of 2%.

In the case of a share deal (ie the purchase of shares in a corporate vehicle holding the real estate), PCC at 1%, calculated on the basis of the fair market value of the shares, is payable by the acquiring party. Similarly, if an interest in a partnership is purchased (ie a partnership holding the interest in the real estate), PCC at 1%, calculated on the basis of the market value of the interest, is payable.

In the event that the purchaser acquires from the same seller at least six residential premises constituting separate real estate in one or more buildings constructed on one land, taxed with VAT, or shares in such premises, or has already acquired at least five such premises or shares in them, the sixth and each subsequent such sale is subject to the PCC at a rate of 6%.

The following taxes may apply to the purchase of real estate, depending on the structure of the deal.

Asset deals:

• Municipal Property Transfer Tax (IMT)
• VAT (IVA)
• Stamp duty (Imposto do Selo)

Share deals:

• Municipal Property Transfer Tax (IMT)

Asset deals

Municipal Property Transfer Tax (IMT) will be calculated on the price of the transaction or on the VPT (value of the real estate assessed by the Tax Authority), whichever is higher.

IMT is calculated using the following formula:

(Taxable value x Rate) – Threshold deduction = IMT to be paid.

IMT is charged at the following rates:

• Flat rate of 6.5% on the sale or transfer of any urban property not exclusively of a residential nature.
• Flat rate of 5% for rural properties.
• Progressive rates for the sale and transfer of urban buildings or apartments exclusively for residential purposes that are intended to be the buyer's permanent residence, ranging from 0% to 7.5% as mentioned in below:

• Progressive rates for the sale and transfer of urban buildings or apartments exclusively for residential purposes and/or intended for letting purposes, but not intended as the buyer's permanent residence, ranging from 1% to 6% as mentioned in below:

To discourage the purchase of real estate in Portugal through offshore companies, IMT is levied at a rate of 10% if the buyer is a company established in a country, territory or region with a preferential tax regime. Further, as of 1 January 2021, the same punitive tax rate applies, when the acquirer is an entity dominated or controlled, direct or indirectly by a company established in a country, territory or region subject to a preferential tax regime. In these cases, no exemptions are made available.

Since 2016 the acquisition of real estate by open-end or privately placed closed-end Real Estate Investment Funds or Retirement Savings Funds are no longer exempt from IMT (until 31 December 2018 it was still possible to challenge the 2016 repeal of the exemption with respect to Real Estate Investment Funds; this interpretation has been followed in numerous arbitration decisions).

However, the property deals may be exempt from IMT or may benefit from tax reliefs in the following cases, among others:

• Property acquisition for resale
• Acquisition of urban property for urban regeneration purposes
• Restructuring operations or cooperation arrangements
• Acquisition of property classified as of national/public/municipal interest
• Exemption or reduction of the IMT tax rates, regarding the acquisition of property that constitutes eligible investment under the Investment Promotion Tax Regime (RFAI)

Real estate owned by open-ended or publicly offered closed-end Real Estate Investment Funds (REIFs), pension funds, or retirement funds no longer benefit from a 50% IMI exemption.

The transfer of property is also subject to a flat rate of 0.8% of stamp duty. Stamp duty will be calculated on the price of the transaction or on the VPT, whichever is higher.

Although, as a rule, the transfer of property and shares in Portugal is exempt from VAT, transfers of property can be subject to the tax. A seller may waive the exemption if certain conditions have been met and they have complied with various formalities.

If the exemption is waived, VAT can be recovered in accordance with provisions in the Portuguese VAT code.

Share deals

In the case of a share deal, as of 1 January 2021, IMT applies to the purchase of an equity position both in a private limited liability company (Lda.) and in a corporation (S.A.) which holds real estate assets located in Portugal if the following requirements are cumulatively met:

1. The asset value of the company transferred is, directly or indirectly, composed by more than 50% of real estate assets located in Portugal;
2. The real estate assets are not directly allocated to an activity of agricultural, industrial or commercial nature, unless the activity is of purchase and sale of real estate property; and

• As result of the acquisition (or other corporate events) one of the shareholders retains at least 75% of the share capital of the target entity (or the number of shareholders is reduced to two persons married or in a non-marital partnership).

Until December 31, 2020, IMT could only apply with respect to private limited liability companies, but this tax applied in all cases resulting in a transfer of at least 75% of the share capital of the company.

If the purchase of shares involves a privately placed closed-end Real Estate Investment Funds, the transaction is subject to IMT if after the acquisition the acquirer holds 75% or more of the units in the fund.

In both cases – asset deals and share deals ― the buyer is responsible for the assessment and payment of IMT, as well as VAT (reverse charge mechanism), if applicable. IMT must be paid before the deed and the notary is obliged to confirm its payment.

Stamp duty, where applicable, is paid by the buyer (who normally also pays the notary's fees). The buyer must present the payment proof to the notary at the moment of the transfer signature. The tax is paid through a document issued by the tax authority (the buyer can issue the document in the tax authority website or request it in a tax authority service).

Also, the attribution of immovable property by means of reimbursement in kind of participation units, arising from the liquidation of privately placed closed-end real estate investment funds, is subject to IMT.

The same is applicable to the transmission of immovable property arising from the merger of the referred kind of Funds.

Real estate transfer tax

Romania does not levy any stamp or transfer tax on the transfer of real estate. Nonetheless, the purchase of real estate in Romania involves several costs such as notary's fees and land book registration fees.

Income tax

When real estate is purchased from individuals income tax is due for such acquisition. This is similar in nature to a transfer tax. The tax is payable by the individual transferring the ownership or other dismemberments of the real property right and is calculated by applying a rate of (i) 3% on the taxable income for constructions of any kind and land related thereto, as well as on land of any kind without construction, held for a period of up to 3 years inclusive (ii) 1% for the assets described above held for a period of more than 3 years.

The value on which the tax is levied is the transaction value set forth by the parties through the transfer documents. If such value is under the minimum value set out in the valuation records kept by the notaries public, the notary public shall notify the tax authorities with regard to the transaction.

This income tax is payable by the seller and must be paid to the notary public before the transfer agreement is authenticated. The tax is not due upon acquisitions made from legal entities or
self-employed persons which are registered with the tax authorities and pay general income tax.

Withholding tax

Non-resident entities are generally subject to a 16% withholding tax (if there is no overriding legislation and there are no overriding provisions in applicable double-tax treaties) on certain types of income derived from Romania, such as: capital gains, interest and royalties, commissions, income from management and consultancy services (irrespective of where the services are performed) or from other services provided in Romania and income derived by non-residents from the liquidation of a Romanian legal entity. The withholding tax applicable for income derived from dividends is 8%.

Non-resident individuals are generally subject to 10% withholding tax for most types of income obtained from Romania.

The withholding tax is usually reduced or eliminated by double-tax treaties (at present, Romania is a party to more than 85 double-tax treaties which usually follow the OECD model), where a valid fiscal residence certificate is made available by the non-resident beneficiary of the income at the moment when the payment is made. Also, for certain types of revenue (i.e. dividends, interest, royalties), the withholding tax rates can be reduced to nil if the relevant legal conditions are met. In addition, in case the national legislation, the EU legislation or double-tax treaties provide different rates of withholding tax for the same income, the applicable withholding tax will be the one which is favourable for the payer (if the payer proves that it has the residence in a state which signed with Romania a treaty for reduction of double taxation and, when the case, proved that the requirements of the EU legislation are met).

Donation tax and inheritance tax were abolished from 1 January 2004. Real estate transfer tax was repealed from 1 January 2005.

Therefore, generally speaking, real estate owners in Slovakia are subject to income tax, real estate tax, and VAT. Real estate tax is “local” because it is set by the municipality and is charged to owner as at the first day of the calendar year.

Asset deals are subject to:

• VAT (Impuesto sobre el Valor Añadido, IVA) as well as stamp duty (Actos Jurídicos Documentados); or to
• Transfer Tax (Transmisiones Patrimoniales Onerosas);

and (in both cases) tax on the increase in the value of urban land (Impuesto sobre el Incremento de Valor de los terrenos de Naturaleza Urbana) if urban land is transferred.

The transfer of land for development or land which has already been developed is subject to VAT at the rate of 21%, except in the case of residential property. With regards to residential property the rate of the VAT applicable to an acquisition is 10%.

The first transfer of a new building, and the second and subsequent transfers of a building which has been or is transferred with a view to being substantially refurbished, as well as transfers resulting from the exercise of a call option by a lessee in a financial lease contract, are all subject to VAT.

A transfer of rural land and land which cannot be developed, second and subsequent transfers of buildings, and the first transfer of buildings that have been continuously used for a period of over two years (under a lease agreement), are exempt from VAT but subject to Transfer Tax at the standard rate ranging between 6% and 11%. The taxable base is the reference value (valor de referencia) of the real estate property established by the General Directorate of Cadastre (Dirección General del Catastro). However, if the value declared by the parties, the price agreed or both are higher than the reference value, Transfer Tax will be calculated on the higher of these values. If there is no reference value or the reference value cannot be certified by the General Directorate of Cadastre, the taxable base, shall be the highest of: (i) the value declared by the parties, (ii) the price agreed or (iii) the market value.

This does not apply if the buyer is a VAT taxpayer, entitled to a full or partial deduction of input VAT from the acquisition. In this case an option may be exercised to waive the VAT exemption and subject the transaction to VAT.

If the transaction qualifies as a transfer of a going concern, Transfer Tax would be payable on the reference value of the real estate properties included in the going concern.

Notarial deeds that record land and building transactions subject to VAT, are subject to stamp duty. Rates vary from 0.5% to 3% depending on the location and type of transaction.

Land and building transactions which are exempt from VAT are subject to Transfer Tax at the standard rate ranging between 6% and 11%.

The transfer of property other than rural land is generally subject to a tax on any increase in value, calculated by the town council at the time of the sale.

The buyer pays the VAT or Transfer Tax. The seller pays the tax on the increase in value of urban land.

Share deals are subject to and exempt from Transfer Tax and VAT.

The purchase of shares in an SPV holding real estate, or owning shares in another company holding real estate, is subject to VAT or Transfer Tax at the standard rate ranging between 6% and 11% of the reference value of the property, when the transfer of the shares is made with the purpose of avoiding the payment of the tax that would have been paid in case of transfer of the real estate. The law considers there are tax avoidance reasons when at least 50% of the transferred assets consist of real estate located in Spain and are not used for business activities, provided that as a result of the purchase, the recipient of the shares acquires control or increases control over the entity.

Stamp duty is payable when the property is acquired directly. The tax rate for corporations is 4.25 percent of the purchase price or the tax value, whichever is higher. The tax rate is 1.5 percent for individuals. The buyer is responsible for paying stamp duty. No stamp duty is payable if the purchase is of shares in the company holding the property.

The following taxes and fees arise upon the transfer of real property regardless of whether the transaction involves corporations or individuals.

1. Transfer Fee: 2% of the Land Department's appraisal value for the property. According to the Civil and Commercial Code, the seller and the buyer are equally responsible for paying the transfer fee unless agreed otherwise by the parties. (Currently, there is a notification from the Ministry of Interior regarding the collection of the registration fee for the concurrent transfer of land and buildings which is effective from 18 January 2022 until 31 December 2022. Under this notification, the rate of the transfer fee has been reduced from 2% to 0.01% of the Land Department's appraisal value for the concurrent transfer of the land and building (only for single house, twin house, row house or commercial building) which has a purchase price of not more than THB 3 million),
2. Withholding Tax: If the seller is a corporation, there is a requirement for the buyer (payer) to withhold and pay to the authorities withholding tax at the rate of 1 percent of the actual sales price or the Land Department's appraisal value, whichever is higher.
   If the seller is an individual, the Land Department's appraisal value of the property will be used and the personal income tax rates will apply after a complex calculation.
3. Specific Business Tax: Specific Business Tax (including municipal tax) applies at a rate of 3.3 percent of the appraisal value, or the actual transaction value, whichever is higher. Specific Business Tax applies if immovable property is sold in a commercial manner or for profit. Generally, a seller who is a corporate entity is liable to pay this tax. While an exemption may apply to a seller who is a natural person in situations where he or she has owned the immovable property for at least five years or his/her name has been entered on the house registration for the property for at least one year.
4. Stamp Duty: If the sale is not subject to Specific Business Tax, it shall then be subject to Stamp Duty of 0.5 percent of the Land Department's appraisal value or actual transaction value, whichever is higher. Liability generally falls on the seller. In other words, the Stamp Duty is exempt if the seller is subject to the Specific Business Tax.

There are currently no such taxes charged in the United Arab Emirates.

There are currently no such taxes charged in Dubai.

The following indirect taxes may apply to the purchase of real estate through each type of corporate vehicle:

• When acquiring an interest in real estate in England or Northern Ireland, the buyer must pay stamp duty land tax (SDLT). SDLT operates under the basis of a progressive system (with different parts of the value paid in the transaction being subject to SDLT at different rates). For a non-residential real estate acquisition SDLT is charged at 2% on the part of the price falling between £150,000 and £250,000 and 5% on any part of the price above £250,000. Higher rates can apply in relation to residential property and if residential property is purchased by a corporate entity for a price of more than £500,000 a 15% rate may apply. A 2% surcharge will applies to acquisitions of residential real estate by non-UK resident buyers which may mean that, in some cases, buyers who already own residential property in England or Northern Ireland  pay a top rate of 17% on the part of the price over £1.5 million.
• SDLT is also payable if the transaction takes place by way of the buyer being granted a new lease. For non-residential real estate, where the lessee makes an initial capital payment for the grant of the lease, SDLT is charged at 2% on the part of the capital payment falling between £150,000 and £250,000 and 5% on any part of the capital payment above £250,000. A further 1% charge applies to the net present value of any rent payable during the term of the new lease (where the net present value exceeds £150,000) up to the value of £5 million, with the rate increasing to 2% for the part of the net present value exceeding this threshold.
• The purchase of real estate (and the grant of leases) in Wales is subject to a separate but similar tax known as Land Transaction Tax (LTT). For a non-residential real estate acquisition (including the acquisition of an existing lease or grant of a new lease) LTT is charged on the buyer at 1% on any part of the price falling between £225,000, and £250,000, 5% on any part of the price falling between £250,000 and £1 million and 6% on any part of the price above £1 million.  Where the annual rent of a new lease is £13,500 or more, LTT is also charged at 1% on the part of any premium up to £225,000.   LTT is also payable on rents due under any new lease with a 1% charge applying to the portion of the net present value of rents payable during the term of the new lease over £225,000 but not over £2 million and a 2% rate applying to the net present value that exceeds £2 million. Higher rates can apply in relation to residential property.
• If the seller opts for a non-residential property to be subject to value added tax (VAT), this is payable (in most cases) at the rate of 20% on the sale price (unless the purchase is of a business as a going concern) and on any capital payment on the grant of a lease or on rent payable.
• If VAT is payable, this is treated as part of the price paid for SDLT purposes.
• Any VAT payable on the purchase may be recoverable from the UK tax authority although this depends on the VAT position of the buyer and what the buyer intends to do with the property.

The following indirect taxes may apply to the purchase of real estate through each type of corporate vehicle:

• When acquiring an interest in real estate, the buyer must pay Land and Buildings Transaction Tax (LBTT) if the price paid for the asset (including any non-monetary value given) is more than £150,000 in relation to non-residential real estate or £145,000 in relation to residential real estate. LBTT operates under the basis of a progressive system (with different parts of the value paid in the transaction being subject to LBTT at different rates). For non-residential real estate LBTT is charged at 1% on any part of the consideration between £150,001 and £250,000, and at 5% on any part of the consideration above £250,000. Higher rates can apply in relation to residential property.
• · LBTT is also payable if the buyer is granted a new lease of non-residential real estate. Where an initial capital payment is payable for the grant of the lease a progressive system of charge applies. For non-residential real estate LBTT is charged at 1% on any part of the capital payment between £150,001 and £250,000 (or on any part of the capital payment between £0 and £250,000 if the average annual rent is £1,000 or more), and at 5% on any part of the capital payment above £250,000. An additional 1% charge applies to the net present value of the cumulative rent payable over the term of the new lease to the extent that such net present value is between £150,001 and £2,000,000, with a further charge of 2% applying to the extent that the net present value exceeds £2,000,000.
• If the seller opts for a non-residential property to be subject to value added tax (VAT), this is payable (in most cases) at the rate of 20% on the sale price (unless the purchase is of a business as a going concern) and on any capital payment on the grant of a lease or on rent payable.
• If VAT is payable, this is treated as part of the price paid for LBTT purposes.
• Any VAT payable on the purchase may be recoverable from the UK tax authority although this depends on what the buyer intends to do with the property.

The buyer pays no taxes in the case of an indirect purchase of real estate or shares through a local company. If the seller is a non-resident, which owns real property through a local company (either directly or indirectly), the withholding tax (WHT) may be applied subject to local company being a real estate rich company. Generally, the company is a real estate rich where 50% and more of value of its shares derives from real estate located in Ukraine. Please note that the definition of real estate under the Ukrainian tax legislation for these purposes as well as the application of such rules require detailed examination of each particular case.

VAT does not apply to share purchases where the consideration is cash or share-for-share.

No US federal taxes are imposed on the purchase of real estate. Various states and localities impose taxes on the transfer of interests in real property within that state and/or local jurisdictions, which can be payable when deeds (documents) or other instruments which convey interests in real property are officially recorded (also known as ‘documentary stamp taxes’, ‘documentary transfer taxes’, or ‘real estate transfer taxes’). In some states (including some local jurisdictions within such state), documentary transfer tax or real estate transfer tax is due on transfers of certain interests in legal entities that own real property within the respective state.

Also, various states impose taxes when mortgages or deeds of trust securing loans that are secured by interests in real estate are officially recorded.

The transfer of land which has already been developed by a registered property developer is subject to VAT at the rate of 15 %. The purchaser pays the VAT.

Gains realized from the sale of real estate are subject to capital gains tax (CGT), calculated by the Zimbabwe Revenue Authority (ZIMRA) in terms of Section 6 of the CGT Act at the following rates:

1. Where a specified asset was acquired after 1 February 2009 and before 22 February 2019, then CGT is levied at the rate of 5% of the capital gain, however, no deductions are allowable in terms of section 11 of the CGT Act. The result is, therefore, that CGT is levied at a rate of 5% on the gross purchase price in the currency of the transaction.
2. Where a specified asset was acquired after 22 February 2019, then CGT is levied at 20% of the capital gain in the currency of the transaction.
3. Where acquisition was prior to 1 February 2009 and is disposed of after that date, CGT shall be calculated at the rate of 5% of the capital gain.

The seller remits the capital gains tax from the purchase price received.

Share deals on listed securities are subject to capital gains withholding tax which will be withheld by the broker at the rate of 4% of the price, if such security was held for less than 270 days on the date of its sale and 1.5 % of the price if the security was held for more than 270 days on the date of its sale..

Property acquired through donations is subject to capital gains tax. A detailed valuation report of the property should be submitted to Zimbabwe Revenue Authority.

A trust is assessable to capital gains tax on the sale of real estate.

Land and building transactions are subject to stamp duty payable by the purchaser at the standard rate ranging between 1% and 4%.

Acquisition of real estate for deceased estates is subject to estate duty, the amount is calculated in accordance with the Estate Duty Act.

Further, an intermediated money transfer tax of 2% is payable on every electronic transaction in terms of section 22G of the Finance Act [Chapter 23:04]. Where a transaction exceeds the sum of ZWL165,000,000, a flat rate of ZWL3,300,000 will be payable. The tax is payable by the purchaser upon making payment to the seller or the seller’s conveyancers. Payments from the conveyancer’s trust account to the seller are exempt from the tax in terms of the Thirteenth Schedule of the Income Tax Act [Chapter 23:06].