MARIGOT–President Aline Hanson has said there will be no tax on donations of land, villas or apartments within families, regardless of the value of transferred inheritance. The exemption applies to all types of donations; in full ownership, part ownership, or gifts with a legal reserve attached to them. The donations may be made to children, grandchildren, great grandchildren, or nephews and nieces.
She added the exemption is only temporary and advised families to contact their notaries. To qualify, deeds must be acquired no later than December 31, 2016.
In the second measure, the Collectivité will not levy tax if heirs decide to put an end to indivisible land and realise a sharing of goods. This is also a temporary measure and the sharing must be realised no later than December 31, 2016.
A third measure that has less scope is that deducting the cost of reconstituting title of property from estate assets is now permitted. Cost involved is, for example, genealogical research or cost connected with using a specialised surveyor.
Hanson, who was accompanied by Financial Department Director David Girardot and Director of General Services (DGS) Philippe Millon, said the two main objectives of the measures voted by the Territorial Council in March are to facilitate matters of inheritance and to release land in favour of economic development.
“Land in some zones is in a state of disorder, aggravated by the delicate question of the “50 pas géometriques”, and by poor quality work by the Cadastre, and this has resulted in an absence of property titles and situations of undivided ownership existing over several generations,” she explained. “Without proper ownership it is impossible to borrow, build, enlarge or renovate, and without title it is not possible for siblings to inherit property.”
She added that complications arise when construction is carried out on family plots that are indivisible, and carried out after the death of the land’s owner, but without the agreement of the heirs, which leads to not only legal problems, but also tension within families.
Finally, when successions are not resolved over several generations, heirs may be saddled with high cost and forced to hire lawyers, surveyors and genealogists.
“In the end, it is the territory that suffers as a whole from this land disorder as absence of property titles limits real estate transactions and reduces possibilities of public or private investment,” Hanson noted.
The Territorial Council in March also voted to create favourable conditions for investment, specifically in releasing land, and some tax obstacles that discouraged owners from transferring land have been removed. Making more land available to potential investors supports the economy, and by extension supports the construction sector and creates jobs.
To encourage the liberation of land, the Council voted to waive the capital gains tax imposed on the sale of land. This was also supported by offering a tax advantage for buyers, in certain cases, in the form of a reduced registration fee (two or four per cent, instead of eight per cent).
The measure is reserved for priority investment projects, i.e. construction of hotels or residences. Again a time limit has been applied and sales must be made no later than July 2017.
Source: The Daily Herald Collectivité waives tax on donations of land