Useful Information for Notaries Public and providers of international legal services

Notaries Public: If you have notarised documents in connection with Bulgaria please read on. Not only can you be of great service to past notarial clients, the recent changes in Bulgarian legislation may provide new business opportunities.

At the beginning of 2008, the Bulgarian government - in line with other European nations – introduced a central company registration system. This means that anyone who registered a limited liability company in Bulgaria to hold property with land will have to re-register the company or risk having all their assets forfeited. As you may be aware, only Bulgarian nationals or companies can buy real estate where land is involved – this is not set to change for a few years yet. Even some apartments include a share of the freehold and will have been registered in the name of company. And some agents advise buyers using a company to hold apartments ‘for tax purposes’.

Even if your client used an agent; they may not have been made aware of the need to re-register. The re-registration process is complex; an added complication is the ‘prescribed’ nature of the documents (Form A4 and G1). This has resulted in many agents telling buyers that they must go to Bulgaria to sign the necessary company forms before a Bulgarian notary – the forms that have to be lodged at Court must be in Bulgarian and only Bulgarian.

Notaries Public: did any of your notarial clients sell a Spanish property between June 2004 and December 31st 2006? If so, they may have been overcharged on Capital Gain Tax by as much as 20% and probably would appreciate you alerting them to the possibility of claiming a refund on a No-Win-No-Fee* basis.

The MyNotary Network has been contacted by a Spanish legal firm that is challenging the Spanish government head on. A claim is being prepared for the European Court of Justice for what it describes as illegal capital gains taxes on overseas property owners. The lawyers in Spain have found that until 2007 a capital gains charge of 35 per cent was levied on property sold by non-Spaniards, despite the fact that the same tax charge was just 15 per cent for Spanish sellers. It is estimated that up to £37m is now owed to British former owners alone. Brits can now start the long process of getting their money back because, as it is suggested that the practice flies in the face of EU laws on discrimination. It may be that one of your clients was one of the 4,500 British citizens who sold Spanish property between 2004 and 2007, and were charged at the non-resident's CGT rate. Clients ask: -

Do I qualify? The answer is ….

• Yes if you sold a Spanish property between June 2004 and December 31st 2006.
• Yes if you were NOT a fiscal resident in Spain when you sold it.
• Yes if the Capital Gain Tax was paid to the Spanish Authorities.
• Yes if you sold your Spanish property as an individual; not as a company.
• Yes if you have, or can obtain, a copy of the Spanish Tax Form “Modelo 212” you completed when you sold the property

See also The MyNotary Network member’s pages at www.MyNotary.info

Email admin@MyNotary.co.uk for more information on any of the above topics.