Travieso Evans Arria & Rengel
Can anyone (including foreigners) own and occupy real estate in your jurisdiction (including shares in property owning companies)? Are there any restrictions?
Yes, in Venezuela, both foreign individuals and companies can generally own and occupy real estate. Nonetheless, Registries and Notaries require the prior registration/verification of foreigners before the SAREN (the Main Office for Registration/Notarization and Authentication Processes in Venezuela): Every foreigner acting on his/her behalf or as a shareholder, Director, Officer, or attorney must be registered before the SAREN and receive an approval of registration as foreigners in order for the document to continue the registration or notarization process. This registration has no legal implication other than serving as a toll to continue with the registration/notarization process.
Are there restrictions on lending for the purchase of real estate by foreign companies? If so briefly give an outline?
Loans for foreign companies from Venezuelan banks are challenging or even impossible, due to stringent credit policies, high inflation, and a general reluctance to engage in long-term real estate lending.
Nonetheless, foreign companies can request loans abroad.
Buying
Please provide a short summary of the fees and costs (including tax) relating to buying real estate in your jurisdiction.
The acquisition of real estate in Venezuela involves several fees and taxes.
The primary cost is the Registration Fees at the Public Registry (Property Registry Office) which are approximately 0.5% to 2% of the sale value, plus stamp duties. Legal professional fees for drafting the sale agreement and conducting the registration process vary but must be considered.
Something to consider, is that in practice, the seller is the party in charge of paying the income tax advance of 0.5%.
Owning
Are there taxes applicable to owning real estate and can the burden of the taxes be passed to someone else (e.g. a tenant or an occupier - not being the owner
Yes, there are taxes applicable to owing real estate in Venezuela. The primary tax is the Municipal Urban Real Estate Tax, a quarterly tax charged by the municipality based on the cadastral value of the property. Other minor municipal fees for services may also apply (garbage collection, for example).
After selling the property, the owner must pay the corresponding income tax return.
According to Venezuelan Law, if the property is registered as Main Residence, the owner is
exempted of the Income Tax Return payment.
Tax Breaks
Are there tax breaks or other incentives for foreigners to buy real estate in your jurisdiction? If so, what are they?
Yes, there are double taxation treaties with several countries. Also, according to Venezuelan Law, if the property is registered as Main Residence, the owner is exempted of the Income Tax Return payment.
This tax breaks are applicable to every individual or company that owns a property (Local and
foreigners).
How is the ownership of Real Estate evidenced in your jurisdiction?
In Venezuela, the ownership of real estate is primarily evidenced through its registration in the corresponding Public Registry. The key document is the Purchase and Sale Agreement (Documento de Compra-Venta), or other title-granting instrument (e.g., inheritance deed,
donation deed). This registration provides legal publicity and constitutes irrefutable proof of ownership ("erga omnes" effect). A Certificado de Gravámenes (Encumbrance Certificate) issued by the Registry confirms the current owner and any liens or encumbrances affecting the property.
Is it possible to keep the identity of owners of real estate confidential in your jurisdiction?
Generally, it is not possible to keep the identity of real estate owners confidential in Venezuela. The principle of public registry applies, meaning that property ownership records at the Public Registry are public. Anyone can request a Certificado de Gravámenes for a specific property, which will disclose the registered owner's name. While a property could be owned by a legal entity (e.g., an S.A. or C.A.), the identity of the directors and shareholders of such entities is also publicly accessible through the Mercantile Registry. Therefore, anonymity for beneficial owners of real estate is very limited. However, it is possible to choose tax/corporate planning alternatives that make it possible to avoid showing certain individuals to the public