Foreigners are free to buy land in sunny Sri Lanka; listed below are the policies and legal aspects to consider. Land can be purchased by foreigners within the island on two conditions; via an outright purchase by paying a 100% Land Tax based on property value or by signing a 99-year land lease on the payment of a 7% Land Tax on property value; the cheaper option, although lacking permanent ownership.Facts Pertaining to Property Purchase in Sri Lanka
- Prepare the contract through a good lawyer. The sale is final only once a legal contract of transfer is signed, between buyer and seller.
- No one but the legal owner of the property has the authority to make the sale. If there is more than one owner all parties must agree to sell.
- Use the services of an estate agent. An estate agent will make sure ownership of property is clarified and the deeds are clear before publicising the sale of the property.
- Your lawyer must check the property deed with the Land Registry.
- Both parties must sign the transfer contract in the presence of a lawyer.
- You must then make full payment, thus becoming the new owner once all documents are signed.
- Your lawyer must then register the property under the new owner’s name with the Land Registry.
- Cash transactions are the preferred choice. Cheques or money transfers are not too popular.
- If funds for an outright purchase are not available immediately, make a deposit of 10% to 20% of the property value and reserve the piece. Do this by signing a contract via a lawyer, middleman or trustee.
- Stamp Duty is charged on a graduation starting with the first 100,000 of the total property value, and varying in value for each additional 100,000.
- Making sure you are in Sri Lanka for signing the contract will be a saver in terms of legal fees; cutting out additional lawyer fees for power of attorney.
For more information and a trustworthy helping hand, speak to the team ay Double Vision today. We’re here to help and will be happy to provide impartial advice.
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