Differences between council property tax and maintenance fee

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Differences between council property tax and maintenance fee

Postby Admin » Thu Jan 29, 2015 1:57 pm

Differences between
* The annual council property tax and
* The annual maintenance fee.

Completed holiday or residential apartments on reduced prices in Bulgarian resorts are still attractive for foreign property, and as the number of these newly built increased a lot in the last 7-8 years, the ownership of apartment because a huge part of the Bulgarian real estate pot. Along with the aspects of the good investment made, the apartment owners met several new and unknown for them obligations in relation to the owned by them properties. These are on one hand, the annual council property tax, and on the other, the annual maintenance fee. We have had many questions by members, asking if these are one and the same debt; but these are not. Also we have had many requests for help by foreign owners of local companies, which have lost communication with their Bulgarian lawyer and recently been chased by the Taxmen for non-paid real estate taxes. In addition there are many apartment owners, who contacted us because been illegally chased by maintenance companies for their fee in particular situations where it is not due according to provisions in our legislation. This is why we will try to outline below in an understandable way the differences between these two legal terms in Bulgaria, according to the provisions of our legislation and the legal practice:
1) The annual council property tax is legal obligation by a property owner towards the local Taxmen. It is imposed by the local Municipality during the year, when you own on apartments, houses and regulated plots of land within its territory.
- On the other hand, the maintenance fee is (annual) contractual fee, which the apartment owner pays to private local company which maintains the common parts of the building, where the apartment is situated. This type of voluntary agreed maintenance fee between the owner and the maintenance company, does not relate to the apartment itself, but only relates to the related to it common parts of the building. (In theory, it should not relate also to maintaining any other individual real estates or facilities like bars, restaurants, fitness, etc. – that are owned by third parties).
2) To create an obligation for payment of annual property tax, there must be a real estate bought and declared at the Authorities in your name, via your BULSTAT number.
- On the opposite, to raise obligation for payment of maintenance fee, there should be a maintenance contract signed between you and the maintenance company; or
- Alternatively a decision by the General Meeting,
3) Annual council property tax is payable directly to the local Municipality (against receipt).
- On the other hand, the annual maintenance fee is payable towards the maintenance company against receipt, or in cases where there acts General Meeting - only towards the bank account of the General Meeting (not directly to the appointed by the GM maintenance company).
4) For non-payment of due annual council tax, the local Municipality will chase you via the public bailiff, where seizing your assets and taking it to a public auction. Practice shows this is valid especially for corporate bodies which own real estates (lands mostly) but do not pay on time their annual property taxes.
- On the opposite, non-payment of your agreed contractual maintenance fee may lead eventually to civil liability, pursued at local civil court by the maintenance company.

So, considering the above, if you believe that:
- You have not declared properly your Bulgarian real estate after your property purchase, or
- You are missing your BULSTAT number,
- You have not paid the annual council property taxes up to present moment, or
- You are experiencing problems in relation to the maintenance and the related annual fee,
then maybe it would be helpful to contact us for more guidance and support at: support@buglariandeals.com

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