Hurry up and buy a property with reduced VAT before the deadline on June 15, 2026!

With the Amending VAT Law (No. 42(I)/2023), which was passed by the House of Representatives and published in the Official Gazette on June 16, 2023, it is provided that the reduced VAT rate of 5%, which is applied to the delivery or construction of a residence intended to be used as a primary and permanent place of residence, will apply to the first 130 square meters of buildable area, for properties valued up to €350,000, provided that the total value of the transaction does not exceed €475,000 and the total buildable area does not exceed 190 square meters.

It is noted that previously, the reduced VAT rate covered the first 200 square meters of buildable area, without any restrictions on either the total buildable area or the value of the residence.

It is also provided that, in the case of individuals with disabilities, the reduced VAT rate (5%) applies to the first 190 square meters of buildable area, regardless of the total buildable area of the residence. However, the value limit of €350,000 still applies, provided that the total transaction value does not exceed €475,000.

A transitional period is also provided, so that the new provisions do not apply in cases where a planning permit has been secured or an application for a planning permit has been submitted by October 31, 2023, and the required declaration is duly submitted within three (3) years from the date the law comes into force, i.e., by June 15, 2026.