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TRTax Regulations in Northern Cyprus
Setting up the trust company usually takes about 2 weeks. The responsible lawyer guarantees the final transfer of the property and the secure payment of the sales price.
The trust company option in Northern Cyprus has been used for more than 15 years, where the Trust holds the property in the name for the buyer. The trust is being treated as a local legal entity and therefore bears a significantly lower tax burden when purchasing real estate. Two contracts will be prepared: one between the Trust and the owner or developer of the property and another between the Trust and the buyer (called "Trust Agreement"), stating that the company holds the property and that the buyer is the beneficiary. The Trust Agreement is very important, it specifies the responsibilities of the Trust with regards to the property(ies) it is holding on behalf of the beneficiary.
For investors the risk of buying a property by using a trust in Northern Cyprus can be mitigated by a carefully drafted Trustee Agreement addressing all possible scenarios. Most important is the selection of a professional and trustworthy real estate agency and an experienced lawyer. The combination allows for a safe and profitable property investment in Northern Cyprus.
Taking an undertaking from the developer to hold the property in the buyer's name until the buyer is ready to transfer it. However there are certain risks associated with this option.
It is an option for foreigners to establish a business in Northern Cyprus and to receive and send funds worldwide with 0% tax, as long as there are no actual business operations in Northern Cyprus. It's an offshore company in Famagusta's Freeport, requiring a local bank account and invoicing from Northern Cyprus.
