Buying & Renovating a property as a Developer

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This topic contains 2 replies, has 2 voices, and was last updated by  HG 1 year, 2 months ago.

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  • #227194


    I have found a three story town house, already registered as three separate dwellings and owned by two companies (actually two company directors) that I would like to renovate into three flats, keep two for myself and sell the third.

    I understand the process and taxes payable if I buy these as an individual but feel that if I did this as a developer there must be significant tax breaks.  Am I right in assuming that if I set myself up as a company I can pay IVA on the purchase and, together with the IVA paid on the renovation costs,  claim this back against the IVA paid by the purchaser of the flat I sell.

    Does anyone know where I can get a full understanding of this subject.

  • #228246


    Hello. Yes, there are tax breaks, BUT obviously its complicated:

    -Company has to be signed up as immobilaria (no other industry).

    -Buying the property is 2% tax instead of appr 10% (if buying personally). HOWEVER, the property needs to be sold within 5 years and cannot be rented out. If you rent it out, you get hit with the difference 10%-2%. Same thing if you keep it for longer than 5 years.

    -All major renovation costs are tax deductible.


    I hope this helps you. For me this tax thing was a maze, but I continue to educate myself.

  • #228247


    Also, the running costs per month for such an SL, company is about 380€ minimum

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