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Money laundering: What type of properties can you invest in without paying the penalty? - La Nacion Propiedades
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Blanqueo: en qué tipo de propiedades podés invertir sin pagar la penalidad
La iniciativa busca incentivar las inversiones en la compra de propiedades
www.lanacion.com.ar
July 22, 2024
The initiative seeks to encourage investments in the purchase of properties
By Candela Contreras
What property should be purchased with the laundered money to avoid paying the penalty?
The Government announced the placements authorized by the Ministry of Economy for money laundering and provided new benefits for taxpayers who adhere to it . The measure promises to boost the Argentine real estate market : the laundered money can be invested in real estate projects .
This announcement follows the regulations announced two days ago by the Federal Public Revenue Administration (AFIP) of the Asset Regularization Regime, following the approval of the Ley Bases and the fiscal package, which allows for the laundering of up to US$100,000 without taxes.
If cash is regularized and left in the financial system until December 31, 2025, no fine is paid and no limit is set. Another option is to invest that cash in some of the investments authorized by the Ministry of Economy, which have just been announced . In these cases, the deadline to regularize money is until September 30, 2024.
The new resolution of the Ministry of Economy and published today in the Official Gazette , establishes the permitted destinations for the funds regularized under Law No. 27,743 on Palliative and Relevant Fiscal Measures.
Along these lines, it should be noted that all assets , exceptionally, must be valued in US dollars . In the case of real estate, its acquisition value, its fiscal value or its minimum value (whichever is higher) must be considered. “Most properties will end up being calculated at the minimum value, because the acquisition value was converted to pesos with a low exchange rate compared to the current one,” explains tax specialist Sebastián Domínguez.
“People who have money under their mattress will be able to launder that capital and buy different assets, including real estate,” says Fabián Achával, CEO of the real estate company of the same name.
Like the money laundering announced in 2022, the resolution includes both new projects and those with a degree of progress of less than 50% at the time of the law's entry into force . In this way, this construction incentive provides benefits to those people who have their money undeclared in the country and can invest it in a real estate project . “We think it is a good measure to promote development and investment in real estate projects. Construction is what generates work, investment, activity and deserves this privileged treatment,” says Damián Tabakman, president of the Chamber of Urban Developers (CEDU) .
Money laundering: new benefits for those who invest their money in real estate projects
“We see it as very positive that well projects are being considered as part of money laundering, given that it boosts a segment of the market that is key as a first home. We have had, in recent times, many inquiries about this type of venture and the payment possibilities in various projects. So, surely, they will have a great boost with this proposal ,” says Luis Signoris, General Manager of Compañía Gerenciadora Fiduciaria (CGF).
Investments allowed in real estate projects
Investments in real estate projects , whether directly or through third parties, are understood to be those that, as appropriate, are made effective through , for example:- Subscription of a purchase agreement or other similar commitment: the funds can be used for the purchase of properties by subscribing to purchase agreements or other similar commitments, as well as for the deed of transfer of ownership.
- Contributions to trusts: must be intended for financing real estate projects.
- Shares of mutual funds and certificates of participation: investors can also subscribe to shares of mutual funds, as well as certificates of participation or debt securities of financial trusts authorized by the National Securities Commission (CNV), whose purpose is to finance the construction and development of real estate projects.
The new measure to allocate laundered funds aims to promote development and investment in real estate projects
Key points of money laundering
Those who do not have their assets declared in the country will be able to launder up to US$100,000 without paying any tax , and without any type of penalty for assets that have not been declared.For amounts exceeding US$100,000 , the project proposes progressive rates; the earlier you enter the regime, the lower the rate to be paid:
- Until September 30, 2024 : a 5% rate is paid on the surplus of US$100,000
- Until December 31, 2024 : the rate is 10%
- Until March 31, 2025 : the rate rises to 15%
If a taxpayer regularizes assets in more than one stage, the stage in which the last addition was made must be considered for all purposes.
Those who keep cash in the financial system until December 31, 2025 or who use it for any of the investments authorized by the Ministry of Economy can launder amounts without a limit and without penalty or taxes (for example, investments in real estate projects).
In the case of regularizing cash , it must be deposited in a Special Account for Asset Regularization, and as long as it remains there until December 31, 2025, it will not pay tax. However, funds that are not transferred to said accounts will be taxed. Cash must be regularized within the first stage, until September 30, 2024 .
Domínguez explains that one case to consider is one in which the taxpayer who launders up to US$100,000 in cash and decides to transfer the amount deposited in the special account to another account in his/her ownership before the deadline for the manifestation of adhesion of Stage 1 (September 30), can only do so under sworn declaration, explaining that this money will be used in duly documented onerous operations, understood as such: invoice, sales agreement, deed, among others.
To verify that the funds are allocated from the special regularization accounts to the developer of a real estate project , the AFIP will be responsible for keeping a registry in which the developer must report the type of work or project to be carried out , the approval of the work permit, its degree of progress and any other information that the agency considers necessary.
"Those who launder cash must maintain investments in real estate projects until December 31, 2025, otherwise they will have to pay the tax," says Domínguez.
Up to US$100,000 can be laundered without paying taxes
Reactivation of the real estate market
Real estate specialists expect a revival in the market for used properties that will benefit from this measure and from the return of mortgage credit to Argentina through 21 banks that offer their UVA lines. And also in real estate projects through money laundering that includes them since “ being able to take dollars out from under the mattress will also revitalize the purchase of projects in the works,” analysts agree.“ The trend is for the real estate market to improve its values but not at a great speed , so there has not yet been a rush to buy,” said Diego Cazes, general manager of LJRamos Brokers Inmobiliarios . In this way, he maintained that “the money laundering will benefit a small part of the middle class that was able to save dollars 'under the mattress' and that will decide to launder them to buy a home.”
“Money laundering will lead to more transactions in properties worth up to US$300,000. Because those who can buy properties or higher values do not need this measure to do so,” Cazes clarified.
“In our opinion, the possibility of buying new and used properties should have been included in the tax benefit without a limit, to encourage the development of the construction industry and the recovery of the real estate market. Limiting the allocation only to real estate projects that are currently in the works is very limited ,” said Domínguez.
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