Hefty tax on property sale!

[steveinbsas]

It could have been as much as 35%. He got lucky, if you can call it that. This is a new law that started in 2010. Anyone who owns property in Buenos Aires and isn't a legal resident and wants to sell their property, you should consider becoming a legal resident first.

Could you be more specific about the law and how it applies to non-resdients?

Does the law only apply to properties in Buenos Aires or all of Argentina?

 

[Ashley]

That sounds about right. A friend of mine (Argentine, resident) had to pay 10% of the sale price of her property to afip when she sold several years. Apparently, Argentines have to pay that tax if they don't reinvest the money into a new property.

 

[jez]

There is a 1.5% Transferencia Inmueble tax: http://www.afip.gov.ar/genericos/impTransferenciaInmueble.asp

If you sell your primary residence with the intention of buying another property within 12 months you are not liable for the tax... but you have to declare this before selling.

 

[steveinbsas]

That sounds about right. A friend of mine (Argentine, resident) had to pay 10% of the sale price of her property to afip when she sold several years. Apparently, Argentines have to pay that tax if they don't reinvest the money into a new property.

She should only have to have paid the ITI (1.5%) if she did not reinvest in another property.

 

[AlfajorEfi]

I asked my lawyer about this before and the only way to avoid any tax at all is when reinvesting the money from the sale towards another house...
however there are some things that could be done earlier of course:
report a lower price on the boleto
and also i think the tax is about 30% of the profit! cant tax for the price, what if u lose money?
I suggest contact a lawyer who knows what he is talking about and find out

 

[TheBlackHand]

It must not have been her primary residence. Argentinians only pay 1.5%

That sounds about right. A friend of mine (Argentine, resident) had to pay 10% of the sale price of her property to afip when she sold several years. Apparently, Argentines have to pay that tax if they don't reinvest the money into a new property.

 

[steveinbsas]

I asked my lawyer about this before and the only way to avoid any tax at all is when reinvesting the money from the sale towards another house...
however there are some things that could be done earlier of course:
report a lower price on the boleto
and also i think the tax is about 30% of the profit! cant tax for the price, what if u lose money?
I suggest contact a lawyer who knows what he is talking about and find out

I believe that 30% is the tax rate on "assumed" rentals, as opposed to the "profit" on the sale.

Still waiting for The Black Hand to add to his post about the "new law" of 2010 that can result in a 35% tax rate on the sale of properties in Buenos Aires.

 

[CarverFan]

The tax is on the peso profit which is a false profit as it assumes no inflation. Hence 50,000 dollar apartment at 3 peso rate if 2005 is 150,000 pesos. At today's rate it is 238,000 pesos. So on paper, the apartment is worth 88,000 pesos more. Based on my friend's apartment, he is paying one third of the peso profit in tax. But in dollars he is paying 100% of profit. AFIP are clever guys.

 

[shoush]

he can always get some papers "done" and pay less taxes...

 

[TheBlackHand]

Anywhere from 17-35%. Only non residents pay it when selling their primary residence. This started less than two years ago.

The tax is on the peso profit which is a false profit as it assumes no inflation. Hence 50,000 dollar apartment at 3 peso rate if 2005 is 150,000 pesos. At today's rate it is 238,000 pesos. So on paper, the apartment is worth 88,000 pesos more. Based on my friend's apartment, he is paying one third of the peso profit in tax. But in dollars he is paying 100% of profit. AFIP are clever guys.