Taxation & Costs

Ongoing Costs

Property and Contents Insurance

Property and contents insurance will be included in the management service charge.

Management and Service Charges

Due to the five year rent guarantee and the automatic rental pool system there will be no management or service charge.

Apartment Costs

Due to the five year rent guarantee and the automatic rental pool system there will be no additional apartment costs.

Taxation

Income Tax

Tax on rental income in Slovakia is 19%; interest from loans provided to finance real estate, expenses and property related costs (e.g. management fees, insurance etc.) can be deducted from the taxable income.

Property Tax

If the property is being used for a business related reason such as renting; an annual Property tax of 12 SKK (€0.35) per sqm for apartments applies.

Holding Property Tax

This is a local real estate and land tax, which is Imposed differently depending on the region.

Real estate tax for a non-residential apartment in the Tatras is currently SKK20/m2/per annum ( 0.60) e.g. a 2 bedroom apt. at 90m2 would incur €54 per annum in taxation.

Depreciating your property

Real estate is subject to tax depreciation on an annual basis. (Although land cannot be depreciated). buildings are depreciated over 20 years, using either straight line or reducing balance method of tax depreciation.

Although the property is rising in value, the owner can depreciate the entire cost of the building for tax purposes, thus in effect paying much less tax.

Exit Costs

Capital Gains Tax

There is no Slovakian Capital Gains Tax to be paid on investment held for 5 years or more.

Estate Agents Fees

Agency fees will usually be around 2-3%

Inheritance Tax

Inheritance Tax was abolished in 2004.

VAT

The purchase price includes Vat at 19%. And has been included in the purchase price of €1,785 per square meter

Currently there will be no VAT to pay on resale.

Accountant

Fareps recommends accounting company Fineal Ltd for any further information you may require regarding tax.

Fineal are experienced accountants managed by registered tax advisor Lenora Natherova.

They have agreed a charge of €50 per hour for Fareps investors.

Contact:
Fineal S.R.O,
Grossling 63,
81109 Bratislava,
Phone : +421 252 921 262
e-mail : ondrej@fineal.sk