How to purchase a property in Bulgaria?
Why is legal advice from a property lawyer necessary?
Before signing any contract for the purchase of a property, one should carefully check the title deed of the vendor. The inquiry aims to find out whether the seller is the legitimate and sole owner of the property, free of encumbrances or liens, subject to litigation or other court procedures, in possession of a habitation certificate, whether the company/vendor is correctly established, or in liquidation or bankruptcy procedure. If no such inquiry is carried out, the client risks entering into a contract obliging him to pay for a property which is burdened/mortgaged, to pay to a seller who has no right to sell the property, or to be evicted from the property by a third person.
A well drafted contract or deed is also a guarantee for the legality of the purchase/sale, assures the client against risks of breach of contract and is able to save clients money associated with the payment of excessive closing taxes and fees.
We offer representation before the competent notary for the signing of deed/conveyance papers. In most cases, the clients are not able to personally sign the papers for sale/purchase of a property, or any other legal document.
We also offer representation before the competent institutions in order to gather all papers required by law from the seller of a property. The sellers of properties are often not able to gather all papers required by law for the sale/conveyance/transfer of the property to the buyer. Most of the time this is due to the fact that they live abroad, or have no time to spare or sometimes just because they are not acquainted with the relevant legal procedures.
Issues regarding the purchase of a property.
Tax registration.
Every owner of property in Bulgaria, regardless of the circumstances under which ownership of the property is acquired, is obliged to apply for tax registration of the property by declaring the acquisition to the local tax office. Examples of the types of circumstance include purchase, donation, inheritance and divorce settlement. If the property is not declared, the owner is in breach of Council Taxes and Fees Act and risks to pay a penalty.
Bulstat registration.
The tax declaration of the acquisition of a property by a non-Bulgarian national is always preceded by a Bulstat registration whereby the owner receives an ID number, also referred to as Bulstat number for tax purposes. Once the Bulstat registration is done and the Bulstat number issued, the owner may use the Bulstat number to register more than one property.
Tax re-declaration of a property .
Non-Bulgarian nationals purchasing apartments through a company set up in Bulgaria pay several times higher council taxes and garbage collection fees than owners of apartments with the same size and location. If you are in the same situation, it is because in most of the cases, registration of your company property into the tax office has been done under Article 17 of the Council Taxes and Fees Act. In this case we advise our clients to re-declare the apartment under Article 14 of the CTFA. As a result the council taxes and garbage collection fees are several times reduced.
Declaration for waiver of payment of garbage collection fees.
Each owner of a property in Bulgaria is obliged to pay annual council tax and annual garbage collection fees. If the owner is not using the property, he can apply for waiver of garbage collection fees and as a result he is not obliged to pay for services (garbage collection) they don’t need.
Opening or transfer of water and electric accounts.
For every property in Bulgaria the local electricity and water companies open accounts for the supply of electricity and water, so every owner can pay his utilities bills. However, it is common practice after the sale of the property for the new owner not to be informed that he has to transfer or open the water and electric accounts in his name.
Wills and legal advice on inheritance issues.
We highly recommend that our clients sign a will for their property in Bulgaria. This way they can manage the specificities of the Bulgarian inheritance law and decide on the inheritance of their assets. We also offer to help you find out the provisions of the Bulgarian law applicable to your specific inheritance issue and help you resolve it.
Drafting and Legal comments and advice on maintenance, management or rental contracts.
Often the clients are contacted by a different companies offering maintenance, management or rental contracts. We offer to review the legal aspects of the contract to guarantee your interests are well protected and also explain to you the tax issues involved.
Legal assistance in organizing owners assembly in buildings regulated by the Condominium Act
We offer legal advice on the requirements of the Condominium Act (CA) We can help you find out what the CA provides in cases where repair works have to be started in the building, where some of the owners refuse to pay their maintenance fees, or where you need to change one maintenance company for another. If provided with a Power of Attorney we can represent you before the Assembly of owners.