What documents must a real estate agent register?

What documents must a real estate agent register?

• the sales mandate
• the compromise of sale

The deadlines are :

In the case of a real estate agent, he must submit the documents within 10 days. For a client who sells his property alone, he has a period of 3 months.

• The registration fees are to be paid by the purchaser
• The registration fee for sale is 5% +2/10 = 6%.
• The rate of the mortgage transcription fee = 1%.
• Total of 7% are charged to the buyer of the property.

What is a tax credit?

When it comes to first-time real estate purchases in Luxembourg, a person can benefit from a tax credit of €20,000.

What are the conditions to benefit from a tax credit?

The purchaser must declare in writing to the administration, within 3 months, any transfer or change of mission of the building concerned. That is to say, the purchaser must respect certain conditions such as :

• Personal occupation of the property concerned for 2 years from the date of signing the notarial deed.
• No renting during the 2 years nor installation of office or the person exercises his professional trade.

(except exception)

• Illness.
• Death of the spouse or divorce.
• Forced sale of the building.
• Expropriation for public utility.

And depending on the financial situation of the client, with all the expenses that he needs to finance. It is also possible not to use the entire sum of 20,000 €, and could leave part of his credit for a later purchase.

Is there a specific regime?

Yes, in case the client intends to resell, it is necessary to inform the notary when signing the notarial deed, in fact this avoids the client to pay the 1% rate of the transcription right.

Refund of registration and transcription fees

If a person buys a property and sells it within 2 years, he/she gets back 6% of the registration and transcription fee.

And if a person buys a property and resells it within 4 years, he/she will get back 4.8%.

Are there any special cases for the payment of registration fees?

Yes, when it comes to the sale (VEFA) of new constructions. For example, if the existing construction is at 40%, the client will pay in relation to what already exists, i.e. 40% too. Regarding the tax credit for VEFA the deadline for repayment is longer than an existing property, it is 4 years and there is a possibility to extend. And everything concerning the VEFA, there is no compromise, but rather a contract of reservation.

Is there a communal surcharge for living on the territory of Luxembourg City?

Persons living on the territory of the city of Luxembourg, by sale or exchange, donation or similar acts, are affected by a tax equal to 50% of the reducted registration fees. That is to say, the 6% registration fee + 1% registration fee + 3% reducted registration fee, total = 10%.

Exception: single family homes.