A revaluation exercise by the Department of Lands and Surveys in Cyprus has uncovered many thousands of properties not declared to the tax department.
Interior Minister in Cyprus, Socrates Hasikos, has written a letter to MPs about the discoveries from a recent revaluation.
The letter states: ‘The recent revaluation has brought to light thousands of cases or properties that were not declared to the tax authorities resulting in the owners only paying for land tax.
The recent general assessment of immovable property valuations formed part of the Memorandum of Understanding between Cyprus and the troika of international lenders.
It was carried out with a view to update valuations of land and properties in Cyprus and found that in general land and buildings registered at 1 January 2013 had been valued according to their current market and zoning prices.
Thousands of valuations made at an earlier registering survey carried out in 1980 however were now found to be incorrect.
Many owners of land valued at that time were found to have erected buildings on the land, but had not declared these buildings to the correct tax authorities.
This omission meant that the owners were only paying property tax on the land at a much lower rate, rather than on the land and buildings.
Overseas property investors that have purchased land in Cyprus and later built on it should ensure that the proper declarations have been made, therefore making certain that the correct taxes are being paid on both land and buildings.
All of the tax evasion cases so far discovered will be passed to the Cyprus tax department.
This new discovery follows reports at the end of last year that 36,500 people were found to own properties on the island worth more than the €12,500 threshold in 1980 and therefore subject to immovable property tax, but had registered with false identification and not paid taxes due. The tax department continues attempts to trace these property owners.