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LEGAL News


Beware rights arising pre-2008


years. This law came into force on 19 June 2008. The limitation period for personal actions is now five years from the date on which the right holder knew or should have known of the facts necessary to exercise his claim. The same deadline applies whether the dispute relates to the obligations arising between traders or between traders and non-traders. Note that special prescriptions remain as in the previous law.


For example, legal actions related to real estate rights remain within the limitation period of 30 years and those related to guarantees and responsibilities of the builder or his subcontractors remain within the period of 10 years of receipt of the building work. So beware of rights arising prior 19 June 2008 which fall within the general limitation: a legal action commencing after 19 June 2013 may be declared inadmissible. [Reported by Loic Raboteau at Kobalt Law – Email: loicr@ kobaltlaw.co.uk]


UK INHERITANCE TAX – LIMITING THE DEDUCTION OF LIABILITIES


Following the introduction of the Finance Bill 2013, non-UK domiciled individuals are likely to face an increase in Inheritance Tax (IHT) on their UK estates if they have borrowings secured against UK property. Currently under UK tax law, IHT is normally charged on the net value of a deceased person’s estate after taking into account liabilities, exemptions, reliefs and the nil-rate band.


Property outside the UK belonging to a non-UK domiciled individual is “excluded property” for IHT purposes. One of the proposed changes is that no deduction will be allowed for a liability incurred


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directly or indirectly to acquire property which is excluded from the charge to IHT. The change will mean that securing a loan against a UK property to use it to fund the purchase of an overseas property will mean that the value of the loan


will not be allowed as a liability for IHT purposes.


[Reported by David Guille at Kobalt Notaries Ltd – Email: davidg@ kobaltnotaries.co.uk]


SPAIN’S €500,000 RESIDENCY VISA


More details have emerged of Spain’s new ‘Golden Visa’ scheme. The measure, which will grant residence permits to foreigners who purchase properties above €500,000, compared with €160,000 initially announced, is part of the Entrepreneur draft bill.


The details about the financial threshold of the ‘Golden Visa’ scheme were announced by Spanish Vice-President Soraya Saenz de Santamaria after a meeting of Spain’s cabinet of Ministers on Friday 27 May. Chris Mercer, Director of the Mercers agency, based in Murcia, says, “This is excellent news, although we would have preferred a more reasonable €250,000- €350,000 threshold to throw it open to more potential investors.” Cesar Garzon, Spanish legal expert, told OPP that he expects the visa to be passed by the end of the year and in force by January 2014.


MEXICO EASES LIMITS ON LANDOWNERSHIP


In an attempt to make the country more attractive to US


retirees, Mexico may lift a major impediment for foreigners who want to own property on the city’s Pacific or Caribbean coasts. The current law allows foreigners to buy coastal properties through trusts in which banks hold the titles. Under the new law, they will be able to buy coastal property and hold the deeds to it, rather than having to set up bank trusts or find silent Mexican partners. Mexican citizens are opposing the change, however, suggesting that the beachfront would cease to exist. The proposed amendment was passed through the Chamber of Deputies on 23 April, and is now before the senate. [Source: Anchorage Daily News]


SERBIA DISMISSES PLANS FOR SECOND PROPERTY TAX


Serbia has stepped back from a plan to tax second properties worth more than €50,000. Finance Minister, Mladjan Dinkic, explained that it had been discovered that many people have second properties which they have inherited and are currently unable to sell. Under current conditions, the tax would therefore have had an impact on the middle classes rather than just the wealthiest owners. However, as part of the government’s commitment to tax reform, from the second half of the year tax authorities will be cross-


Many cannot sell second home


referencing assets and income. Those who live in large properties and are unable to explain how they can afford to do so will be liable to pay extra tax. Mr Dinkic said that the second property tax will still be implemented at a later date. [Source: www.tax-news.com]


Visit www.opp-connect.com for more updates and breaking international real estate news stories


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