Argentina Property Taxes
PROPERTY TAXES
Tax Identification Number
Every prospective buyer of an Argentinean property must register for a tax identification number or CDI, which is the basic tax document needed for buying a property if the buyer is not conducting business activities in Argentina.
In order to obtain a CDI, you will need a domicile-certificate reported by the police. To obtain the domicile-certificate you must go to the police station in your area, with a photocopy of your passport, along with the original, fill out a form, and pay 15 pesos ($3,5 U$S) for a domicile-certificate (“Certificado de Domicilio"). In one day time, a policeman will visit you at your apartment or hotel to verify your temporary residence in Argentina. After visual inspection the policeman will provide you with a signed certificate.
You will have then to go to the AFIP (tax authorities in Argentina) agency provided in your certificate, with your passport (original and 2 copies of the first page), and the domicile- certificate. In the AFIP Agency you will have to collect a CDI Form ("Formulario CDI"), and bring it to the Entrance Desk (“Mesa de Entradas”). You will be given a CDI or tax identification number and you will hence have the power to purchase property in Argentina, and pay taxes.
If you do not wish to spend time coming down to Argentina, you can execute a power of attorney so that someone can obtain your tax ID in Argentina. If you wish to grant a power of attorney, you do not need the domicile certificate, because your lawyer or grantor will take care of that.
Again a legal consultant would assist you getting your tax ID and sorting things out with the police and the tax authorities.
Taxes to be paid on a property purchase
a) Taxes to be paid by a foreign purchaser who will not live in the property.
First of all, you (the buyer) will have to pay a value added tax a VAT of 21 % for the closing amount and the relevant charges including the lawyer or real estate agent commission.
In addition If you buy a new apartment directly from the developer or builder company, you will have to pay a VAT of 10.50%. However, such tax amount is usually included in the final price offered by the property developer or the real estate agent. Buyers do not have to pay any VAT on the property price for older buildings.
You will also have to pay a stamp duty on the purchase. In Capital Federal, the duty is 2.5 % of the purchase value. However, this tax is normally split 50:50 with the seller (distribution is normally agreed during the trade). In Buenos Aires province, the stamp tax is of 4 %, which is also normally divided 50:50 between the buyer and the seller.
Provided you rent the purchased apartment you will also have to pay the income tax ranging from 9 to 35 % on all of your rent income. Annual income of more than 120,000 pesos (40,000 USD) falls into the top tax bracket of 35 %. Local taxes will be generally charged to the apartment tenant.
b) Taxes to be paid if the foreign person lives in the property he has just purchased
If you are in Argentina for more than six months (180 days) in a calendar year, you are considered an Argentine resident for tax purposes. Otherwise, you are regarded as a non-resident.
As a resident, in addition to the VAT taxes, and the income tax if you do any working activity in Argentina while being a resident, you ( the buyer) ,whether living in the property or leaving it vacant, must pay an annual tax on personal assets, including residential real estate. The rate is 0.5 % on assets valued up to 200,000 pesos (around USD 63,000) and 0.75 % on assets valued at more than 200,000 pesos. However, there is a non-taxable minimum of 102,300 pesos (around USD 30,500).
Finally, be advised that there is a local tax for the city services as street lighting and cleaning the streets known as Alumbrado, Barrido, y Limpieza or ABL. Annual amount only comes to several hundred pesos.
Additional Information:
* Legal restrictions on ownership for non-resident persons
* Warranties granted to the buyer
* Intermediaries and rates
* Transfer money to Argentina
* > Go back to Buenos Aires Real Estate Guide: The Buying Proces
