Kilkis wrote:Also what do you do if there wasn't a purchase price for the while property? I bought a plot of land and had a house built so there is a transfer of ownership contract for the land BUT NO transfer of ownership contract for the house. There is only a private contract which the developer and I signed showing what he was charging me to build the house. How do you show capital gain, or loss as it would be at the moment, in that situation?
That was exactly our own position. The law was clarified for this very situation in one of the many MinFin clarification circulars. It works by deriving a notional acquisition cost from the selling value and looking at the house price indices at time of build and at time of sale. From memory, the acquisition date is derived from date of building permit + 5 years. Example - land bought 2003. This is the value in the deeds. Building permit issued 2004. Sale for 100k in 2015. Notional acquisition date is 2009 (2004 + 5). Notional cost is 100 x (249.8/163.1)= 153k. Loss of 53k, no CGT. (The indices are the top table in the spreadsheet in the 4th link down of http://www.bankofgreece.gr/Pages/en/Statistics/realestate/default.aspx ) In this example, where the selling date index has not yet been published (2015), go back to the first available year = 2014.
As it happens, CGT was very live when we started our sale (back end 2014). We spent a lot of time discussing it with our lawyer and a notary, who eventually we managed to convince about the methodology above. As the transaction progressed, a new law was published which suspended CGT on property sales following pressure from real estate associations. The suspension was intially for 2 years, covering completions in 2015 and 2016. We faced no CGT calculation in Jan 2015, and I believe the suspension remains in force today (but I'm not as close to the subject, so don't rely on this).
I am aware of one sale that completed in 2014 that did attract CGT. The seller, in their original purchase contract way back when, had fiddled things by putting only 40 or 50% of the value in the contract, the rest being "off the books" and paid outide of Greece. CGT was calculated on the 40 or 50% value in the deeds and the seller paid a fair chunk of CGT. As far as I know from my research at the time (extensive, painful) objective values were never used in calculating CGT.