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Thursday, October 02 2014 @ 02:21 AM EDT

Is Your Property Exempt From Paying Taxes?

Law & LawyersBy Ricardo Faraudo for Panama-Guide.com - It is a well known fact that new properties in Panama are entitled to twenty (20) year property tax exoneration. This incentive is one of the main attractions for investing in a property here. However most people assume this exoneration has been applied automatically when they purchased their property and thus do not pay much attention to this issue. Nevertheless, when handling sales of property for our clients, we have frequently discovered the tax exoneration was never properly registered and the current owner in fact owes money for unpaid taxes which could have been (and should have been) completely exempted. This in turn can become a very serious situation for the owner of the property who is trying to complete a sale. The only two options are to either postpone the sale until the property can be properly registered to qualify for the exoneration (which can take more than one month to get done), or to proceed with the sale and pay the past due taxes and sale the property as it is, and have the new buyer register the tax exoneration, that the property is entitled to. When you purchase a property that qualifies for the property tax exemption, it is important to verify that the transfer of title has been properly updated on the records of the Ministry of Economy and Finance, and to confirm accordingly the tax exoneration has been duly completed. We have learned many developers do not tell their clients that the property tax exoneration is not automatically applied when the property is purchased. Therefore most property owners incorrectly assume this issue has been taken care of when they purchase their property. If you contact us at info@prapanama.com during the next 3 months and identify yourselves as readers of PANAMA GUIDE, we will confirm whether your property received the property tax exoneration at no cost. (Note: The author of this article, Ricardo Faraudo, is a founding partner of Panama Relocation Attorneys.)

Copyright 2009 by By Ricardo Faraudo for Panama-Guide.com. Go ahead and use whatever you like as long as you credit the source. Salud.

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