Buyer legal guide · Taxes & fees
Closing costs, taxes & agency fees
Every statutory tax, developer transfer fee, brokerage commission and ongoing landlord levy in Erbil, Sulaymaniyah and Duhok—with worked USD models.
- Tapu transfer tax
- ~3.0%
- On state-assessed value
- Contract assignment
- $500 – $3.5k+
- Or 1% – 2% developer fee
- Resale brokerage
- 1.0% – 3.0%
- 0% buyer fee on direct off-plan
- Annual rental tax
- 10.0%
- Assessed lease revenue
Advertised apartment and villa prices in Kurdistan rarely include closing fees. Depending on whether you buy a ready Form 25 Tapu villa, a resale developer contract, or a direct off-plan unit, buyer-side closing costs range from roughly 1.2% on a primary off-plan purchase to more than 4.5% on a Tapu resale—before you factor in compound service charges and the 10% rental revenue tax.
Complete transaction, leasing and tax schedule
| Fee or tax item | Benchmark rate / range | When it applies | Customary payer |
|---|---|---|---|
| Tapu transfer & registration tax | ~3.0% of state-assessed value | Government Tapu (Form 25) purchase; assessed value is often 70%–90% of contract price | Negotiated or split 50/50 buyer & seller |
| State stamps & Tapu clearances | ≈ $250 | Every Tapu Directorate registration | Buyer |
| Developer contract name-change fee | $500 – $3,500+ or 1%–2% | Secondary resale of a Developer Contract (Grêbest); $0 on direct off-plan | Buyer or seller by agreement |
| Off-plan primary brokerage | 2.0% – 5.0% (0% buyer fee) | Buying new inventory directly from a developer | Paid by developer out of marketing allocation |
| Secondary resale brokerage | 1.0% – 3.0% (1.5% buyer bench.) | Buying an existing villa, apartment, or resale contract | Customarily 1%–2% buyer and/or 1%–2% seller |
| Legal, title & NOC verification | $500 – $2,500 ($750 check) | Independent Tapu check, Master Tapu/licence audit, contract review | Buyer |
| Embassy Special POA & attestation | ≈ $450 | Diaspora remote purchases via Iraqi Embassy Wakalay Taybat | Buyer |
| Leasing agency commission | 1 month’s gross rent | New corporate, NGO, or residential tenancy | Customarily tenant/employer (or split on multi-year) |
| Absentee property management | 1 month’s rent / yr (~8.3%) | Ongoing tenant vetting, rent collection & maintenance oversight | Landlord |
| Annual rental revenue tax | 10.0% | Assessed annual lease value via local real estate tax directorate | Landlord |
Notice why pathway matters: on a primary off-plan unit, the developer pays the marketing commission (2%–5%) and there is no secondary transfer fee, keeping buyer closing outlay to legal/title checks. On a ready Tapu resale, the ~3% state registration fee dominates—unless buyer and seller agree to split it 50/50, which cuts the buyer’s Tapu cash outlay in half.
Four worked examples across real developments
Using the exact calculation rules inside our Closing Cost & Net USD Yield Calculator, here is what closing costs and net yields look like across four benchmark properties:
| Scenario & reference unit | Price | Closing costs | All-in cost | Net yield |
|---|---|---|---|---|
| Dream City · Villa (Tapu, 100% buyer share, local) | $920,000 | $36,880 | $956,880 | 3.1% net |
| Empire World · 2BR (Tapu, 50/50 split, local) | $155,000 | $5,185 | $160,185 | 5.8% net |
| Erbil Boulevard · 2BR (Contract resale, diaspora POA) | $145,000 | $4,875 | $149,875 | 6.3% net |
| Lebanese Village · 1BR (Direct off-plan, foreign $50k+ residency) | $62,000 | $750 | $62,750 | 6.9% net |
| Models use Tool 1 defaults: 80% Tapu assessed ratio, $1,500 contract fee, 1.5% secondary brokerage (0% off-plan), $750 legal, $450 POA (diaspora), 5% vacancy reserve, and each project’s published reference rent and service fee. | ||||
Look closely at Empire World ($5,185 closing costs with a 50/50 Tapu split on a $155,000 apartment) versus Erbil Boulevard ($4,875 closing costs on a $145,000 company-contract resale with a diaspora POA). Open any project’s calculator preset to adjust the Tapu split, developer fee, or rental tax toggle live.
Five fee traps that surprise overseas buyers
| Stage | What comes due | Trap to avoid |
|---|---|---|
| 01 · Legal & NOC audit | Legal check retainer (~$750) before any binding payment | Paying a non-refundable cash deposit before Tapu/NOC verification |
| 02 · Contract / Tapu closing | Purchase price (or off-plan down payment), Tapu ~3% or developer name-change fee, stamps, brokerage | Assuming the developer’s name-change fee is covered by the seller without written wording |
| 03 · Post-closing occupancy / lease | Compound monthly service fees ($45–$400+), utility transfers, 1-month leasing commission if let | Ignoring compound service charges when comparing gross vs. net yield |
| 04 · Annual holding | Annual management fee (1 month’s rent if managed) & 10% rental revenue tax assessment | Modelling gross rent as spendable income without vacancy, service and tax provisions |
- Surprise developer name-change escalations: Developers sometimes raise internal assignment fees between phases; verify the current fee directly with the developer’s commercial office before pricing a resale.
- Ignoring the assessed-value gap: A ~3% Tapu fee on a $920,000 villa where the committee assesses value at 80% ($736,000) is $22,080—plus $250 stamps—if paid 100% by the buyer, or $11,040 each if split 50/50.
- Confusing gross yield with net yield: High-service-fee luxury towers and villas ($180–$400+/mo) lose 1.5% to 2.5% of annual yield to compound fees, vacancy, and the 10% rental revenue tax.
Frequently asked questions
How is the ~3% Tapu transfer tax calculated in Erbil and Sulaymaniyah?
The Real Estate Registration Directorate charges ~3% of the government committee’s assessed valuation—which is often 70% to 90% of the open-market contract price—plus nominal stamps and clearances (~$250). Select older compound schedules sometimes cite 2%–3% depending on valuation brackets. Buyer and seller customarily split or negotiate who pays it.
Do I pay buyer brokerage when buying off-plan directly from a developer?
No. On direct primary off-plan developer sales (such as Pavilion by Rams or Lalav City), the developer pays the 2% to 5% marketing commission out of its own allocation, so the buyer fee is 0%. Secondary resales carry 1% to 3% brokerage, customarily 1%–2% from buyer and/or seller.
What is the developer name-change fee on a company contract resale?
Private developers are not bound by a fixed state percentage. Expect an administrative transfer fee of $500 to $3,500+ flat, or 1% to 2% of contract value, payable inside the developer’s commercial office once all overdue installments and compound NOC dues are cleared.
How much tax do landlords pay on rental income in the Kurdistan Region?
Rental income carries a statutory 10% annual real estate rental revenue tax benchmark administered via local real estate tax directorates on the assessed annual lease value.
What are the leasing and ongoing property management fees?
Corporate, NGO, and expat leasing carries a 1-month gross rent commission (customarily paid by the corporate/expat tenant or split on multi-year leases). Full-service diaspora property management is typically 1 month’s rent per year (~8.3% of annual gross rent).
Private consultation
Want an exact fee breakdown on a specific unit?
Share the project name and asking price. We confirm the unit’s title track, obtain the developer’s current transfer fee or Tapu split custom in writing, and send a full net-cost sheet.
Request received
Your reference is KRG-0000-0000. Keep it for any follow-up.
What happens next
- An Erbil advisor reviews your brief and checks title status on the projects you named, within one working day (Sun–Thu, 09:00–18:00 AST (UTC+3)).
- You receive a first shortlist or verification note on WhatsApp or email, with USD prices, fees and the title track of each unit.
- We arrange viewings in person or by live video, and line up independent legal checks before any deposit.
Referenced in these KRG Property pages
Development dossiers
- Erbil Hills
- Erbil Avenue & Avenue Square
- Italian City 1 & 2
- American Village
- Spanish Village & Mass City
- Cavalli Tower
- Park View
- MRF Quattro & Star Towers
- Wavey Avenue
- Rami Towers
- Sky Towers
- Naz City (Zakaria Apartments)
- Lalav City Erbil
- German Village (Gundy Almany)
- Pak City & Goizha City
- Lalav Lawan & Masike Towers
