Jump to content

A few questions when buying a lot of land?


Delboy
 Share

Recommended Posts

I am in the process of purchasing a lot of land in Nosara. I have seen the lot, looked at the cedula etc. with the seller and made a verbal commitment. After talking to a lawyer, I have a couple of questions to those who have knowledge in this.

1) Should I, or shouldn't I buy the lot in my name or create a corporation??

2) When closing and declaring the land value, does one typically declare the full sale price or the 'other' more deflated price that is on the books and usually a lot less and therefor a lot less tax to be paid.

Many thanks in advance for the advice

Link to comment
Share on other sites

Greetings,

Keep everything on the 'up&up'.

Buy the property in your name to avoid any potential swindle factor. (When money is involved, even the tightest of friendships can evaporate.)

You might want to get a Tico to negotiate the sale price on your behalf to fend off being charged the dreaded Blue-Eye Price and you could even attend the negotiations to be sure things are going as you want them to.

Why not set up a corporation? Legal fees (and taxes, for that matter), in Costa Rica are minimal compared to Canadian and US standards. That way, your business can help stimulate the local economy. However, (Heaven forbid), should you find yourself in legal difficulties, (like a car accident or something), you, personally, might be sued, but that which remains the property of the corporation cannot be touched.

As mentioned earlier, taxes in Costa Rica are minimal so why fiddle with declaring the purchase price? Keep everything legal and proper so you won't have anything to worry about.

 

Barbara :rolleyes:

Link to comment
Share on other sites

Wally couldn't be more right, although I will have to recommend that once you have a clear title on the property and if you choose to register it under a corporation name, you make sure that a supervision on the Public Registry is conducted at least twice a year, since properties own by corporations that are not active businesses (such as any type of commercial companies), are more likely to be subject of irregularities with its assets.

This is done by unscrupulous individuals that manage to illegally produce (forge) the proper documentation to sell the property without the corporation's knowledge, and with complete ignorance from the Public Registry who assumes that everything is legal.

Definitely the key element here is proper supervision by a qualified Attorney.

Another benefit to register it under a corporation's name is that if you want to sell it, you could simply sell the corporation (endorse the stock certificates), and save the registry transfer taxes (wich is very common and completely legal).

Also, make sure that you have a clear title on the property, ask for any unregister leases, liens, encumbrances or any other easements, even check regularly for the presence of squatters (not that common).

Hope you do great with your deal.

 

Rafael Fallas

Link to comment
Share on other sites

  • 4 weeks later...

Delboy,

 

You already have some solid answers here, and using a corporation or not comes down to choice. The advantage as mentioned is when you sell, and liability protection. However be very careful with a corporation. I like to talk to people in person normally, but in short, make certain YOU provide the names of all directors (people you KNOW and TRUST) that only the directors that you want have power (individual or combined with another) and that you obtain the 6 corporate books and all legal documents.

 

In regards to register value, follow your lawyers advice, as they will know what is reasonable.

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
 Share

×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.