The abolition of the certificate of non-payment of VAT for transfer contracts is coming back to the fore in an attempt to facilitate and speed up contracts for purchase and sale of real estate, parental transfers etc.

An … antiquated legislation imposes the obligation to attach a certificate of no TDS debt to in rem transactions. The rate is determined by a decision of the municipal or community council and is uniform for the entire administrative district of the municipality.

The real estate tax is subject to:

a. all types of real estate located within an approved town plan or within the boundaries of settlements existing up to the year 1923 or within the boundaries of settlements with a population of less than 2000 inhabitants,

b. buildings of any kind located outside the approved town plan or outside the boundaries of settlements existing up to the year 1923 or outside the boundaries of settlements with a population of less than 2000 inhabitants.

In many municipalities, it can take up to two months to issue the TAP – with no means – even two months. And that’s not all: There is a growing number of protests from property owners across the country, both those who crowd the country’s municipalities every day to obtain a certificate of no TAP debt (when they usually have no debt) and those who have not taken advantage of the favorable provisions that have been in place until recently. Many owners, when they apply for a certificate of non-payment of VAT for a property transfer, are faced with exorbitant amounts of 12 years of VAT arrears which they are unable to pay! Landlords are therefore calling for the complex procedure for granting TAP to be replaced with a simplified electronic procedure for the notary to check the areas.

1) Which law requires the payment of the TAP?

The payment of the T.A.P. is imposed in accordance with the provisions of Article 24 para. 17 of Law 2130/93.

2)Which property owners are liable for the payment of the tax?

The owners of the following properties:

-The electrified, in which the collection of the T.A.P. is made directly through the electricity provider’s bill .

-The non-electrified properties (buildings or plots of land) for which the collection of VAT is carried out by the municipalities to which they belong and are registered.

3)How necessary is the T.A.P. certificate?

A T.A.P. certificate is absolutely necessary for the drawing up of contracts and the transfer of property.

4)How can we pay the amount of the resulting difference (T.A.P.)?

The resulting amount cannot be paid in instalments but only once at the town hall treasury or by a corresponding deposit in a bank account of the municipality.

5)In case of change of owner what is required?

The following is required for a change of owner

-Submission of an application to the Revenue Department of the municipality

-Copy of the contract

6)Can I only get a certificate for my share of a plot of land?

Yes, if the full details of all co-owners are notified to the department.

7)How long is the certificate of non-debt valid for?

The T.A.P. certificate for notarial use is valid until 31/12 of the current year. In case a deed is not drawn up in the current year, the person concerned should return the original certificate obtained in the previous year and apply for a renewed T.A.P. certificate for the new valid year.

8)What applies to non-electrified properties?

Properties without electricity are NOT exempted from the payment of Real Estate Tax (article 24 of Law 2130/1993).The owners must declare, within two months of the interruption, their properties without electricity to the Municipality for the calculation of the Municipal Taxes and the Real Estate Tax to the real debtors: owner, co-owners, tenant, etc. /75 and article 5 par.1 of Law 3345/2005 & article 24 par.3 of Law 2130/1993).

The late submission of a declaration of Non-Electrified Property results in the imposition of a penalty (article 19 of Law 1080/1980) and a fine (article 24 par.12 of Law 2130/1993) from the date of interruption to the date of declaration.

When the property is used without electricity, the user (tenant: Article 21(5) of the State Decree 24/9-20/10-58 or owner: Article 4 of Law 429/1976) is liable for the municipal fees (D.T.), while the owner or co-owners are liable for the real estate fee (T.A.P.) (Article 24(3) of Law 2130/1993).

Taxes in favour of the local authorities

The local government has the right under current legislation to impose various fees and taxes on real estate. Apart from the Real Estate Tax (TAP), whose tax framework is set by the State (Law 2130/1992), the most common taxes imposed by the municipalities on property owners, the amount of which is determined by the local authorities themselves, are the following:

1.Municipal Cleaning – Lighting Fees

2. Municipal Tax on Electrified Areas

3. Municipal Potential Fees (with various justifications)

4. Municipal Pavement Occupation Fees.