The Moratorium affected the free movement of capital between the European countries and virtually acted to ban the purchase of land in Bulgaria (as a second property) by foreign individuals and legal entities.
Since January 1st 2012, with the removal of the temporary ban, the purchase of Bulgarian property, with the adjacent land, by citizens of the European Community became possible. This opportunity can benefit all citizens of EU, Kingdom of Norway, Republic of Iceland, Principality of Liechtenstein and the Swiss Confederation.
Two years after the beginning of 2012, is expected to be removed the ban on purchase of agricultural land in Bulgaria, by the European citizens.
In fact, until now the land was purchased by Bulgarian company, registered by foreign persons, with this special purpose, as this procedure was circumventing the Moratorium.
The changes enable all European citizens, who purchased property through their company, to transfer the property on themselves, as individuals or if they have yet to purchase a property, they can interact in the business transaction as persons.
From financial point of view, it’s very rational action, because it drops out most of the previously paid maintenance costs of the companies – owners of the property.
Some annual extra costs associated with the previously used procedure for purchase of property through specially registered company, are:
- Mandatory annual service for the companies with no activity, concerning tax declarations, financial statements etc.;
- Higher taxes for the company – owner of the property;
- Continued growth of service taxes for companies;
- Constantly raising tax assessments of company properties, which lead to higher costs when selling the property in later stage.
Do not underestimate the fact that as a person you have greater security on your property. Lately there are ideas for special registers of properties not for sale.
Legal person is riskier entity, for example, in case the seat of such company is fictitious, does not receive regular correspondence, the company is likely to be debtor on non-existent contract with unfavorable outcome, most often – seized property and public sale, which we all witnessed in recent years.
Lawyer`s Office Tomovski
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