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Transfer of property, haligah vrs banson (no. j4/37/2016) [2018] ghasc 5 (31 january 2018);.
IN THE SUPERIOR COURT OF JUDICATURE
IN THE SUPREME COURT
ACCRA – A.D. 2018
CIVIL APPEAL NO. J4/37/2016
31 ST JANUARY, 2018
THERESAH HALIGAH …..… PLAINTIFF/APPELLANT/APPELLANT
- Read more about Haligah Vrs Banson (NO. J4/37/2016) [2018] GHASC 5 (31 January 2018);
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Sakyiama v Tema Development Corporation (J4/25/2015) [2016] GHASC 58 (06 June 2016);
IN THE SUPREME COURT OF JUSTICE
ACCRA, AD. 2016
CIVIL APPEAL NO.J4/25/2015
6 TH JUNE 2016
A. R.DUODU-SAKYIAMA ---- PLAINTIFF/RESPONDENT/APPEALANT
- Read more about Sakyiama v Tema Development Corporation (J4/25/2015) [2016] GHASC 58 (06 June 2016);
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- TRANSFERRING LAND TITLE IN GHANA
by Koba Joseph | Jun 7, 2021 | Land | 0 comments
Transfer of an interest in Land or title and registration of such interest is normally done after a buyer has made payment for the purchase of a parcel of land from an original interest holder(Seller). The registration of the land or interest is very important since it puts your registered land on Notice to the whole world about the true owner of the said land, which will also go a long way to prevent other people from claiming ownership of the land in question. Registered lands normally come with a whole lot of benefits since it helps the individual to easily get mortgage or loans from banks and other financial institutions – These institutions find it safe to deal with individuals who have their lands registered because of the ability to trace the true owner of the land using the site plan tendered in by the owner.
Read More: LAND OWNERSHIP AND REGISTRATION IN GHANA
Transfer of interest or land title precedes registration of such interest. And the document of title transferring interest is the indenture or the deed of assignment which must include a cadastral plan or site plan. The indenture must contain the TITLE, DATE, and ADDRESS OF PARTIES INVOLVED.
However, in transferring interest, there are requirements one must meet before the documents will be considered by the registrar for approval.
REQUIREMENT FOR A TRANSFER OF LAND INTEREST TO MATERIALIZE
1.PREPARATION OF A DEED OF ASSIGNMENT
The deed of assignment also known as the indenture is an official document that contains an expression of the heirs, successor, title, and address of both parties. The deed to be submitted should include the site plan and oath of proof.
SITE PLAN: The site plan is the document or file that contains bearings of the land and the exact location where the land is plotted.
OATH OF PROOF: The Land Act,2019 requires that any document submitted for registration should prove to have been duly executed by the grantor, by the oath of one of the subscribing witnesses of the grantor. The Land Act requires for the oath to be made before the Land registrar within the area where the land is to be registered or before a high court judge.
2 CONSENT LETTER . The Lessee is required by law to get a letter of consent from the lessor and attach the same to the deed for submission at the Lands Commission. In the case where the lessor is not the allodia title owner of the land in question, the lessee will need additional consent from the allodia title owner for submission at lands commission.
3.The conveyance (be it assignment, sublease, etc.) must be prepared by a legal practitioner in line with the legal practitioner Act, and the contract of transfer be signed against the person for whom the contract is proved.
4. The Expressions in the conveyance should include the heirs, successors, personal representatives and assigns.
SUBMISSION OF DOCUMENTS TO THE LANDS COMMISSION
Once the requirements are met, the lessee submits the documents at the customer access unit of the lands commission, an evaluation is done for the lessee to pay tax (1% of the market value or less) which is often regarded as stamp duty.
After paying the stamp duty the documents are stamped and re-submitted to the land registrar to finally effect the transfer into the name of the lessee. Ordinarily, the process of transfer should not last more than three months.
Joseph Koba
Real Estate consultant and Managing Director of Alisa Properties
Email: [email protected]
Tel: 0206807856
www.alisaproperties.com
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Land Registration In Ghana – Complete Guide 2021
Land registration in ghana, 1. do i need to register my property, 2. why should i register my property.
a. Registration of documents relating to landed property is compulsory in Ghana.
b. Registration confers priority on the registrant. It confers priority over all other registrations affecting the same land.
c. Registration serves as notice to the whole world that you own the property.
d. When you register your title to a land, all other interests acquired after your registration will be subservient to your title.
e. Registration will however not cure a defective title. Thus, if your grantor does not have good title to the property, registering the property will not make the title good.
3. What do I need to register?
Deed registration.
a. This is the registration of any document affecting a land in Ghana.
b. It is compulsory and required under Ghana law to register a document affecting land.
c. A document to be registered must be proved on oath and must contain sufficient description of the land.
Title Registration
a. Registration of title to land is the foremost evidence of title to a land
b. Registration of title to land has the potential of curing defects in title
c. Registration is final and conclusive evidence of title and no subsequent claim inconsistent with the title shall defeat the title.
4. How do I register my land and what are the steps?
The body authorized by law to register lands in Ghana is the Lands Commission. Registration of land involves:
a. The conduct of a search at the Client Service Access Unit (CSAU), (formerly Lands Valuation Board), on the property to be registered to ascertain the previous ownership of the land and any historical transactions affecting the land;
b. Assessment and payment of stamp duty on the instrument/deed of transfer at CSAU;
c. Stamp duty is assessed between 0.5% to 1% of the value of the property;
d. The stamped document is then submitted at the CSAU for application for a land title certificate.
5. How long does the process take?
The process may take up to a year or more.
6. How much does it cost to register land in Ghana?
Various factors influence the cost of the registration process including:
a. the size of the property
b. the location
c. the value of the land
d. other costs such as stamp duty which is valued between 0.5% to 1% of the land’s value
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Fraudulent Transfer of Property | Section 53 of TPA
In this blog, we will discuss the fraudulent transfer of property. The concept of fraudulent transfer of property is incorporated under section 53 of TPA – Transfer of Property Act, 1882. We will elaborately explain rules laid down by section 53, essential factors constituting fraudulent transfer, who can sue under section 53, nature of suit, applicability and effects of section 53 and lastly the exceptions to section 53 with relevant case references.
Introduction
In simple words, fraudulent transfer of property denotes an illegal transfer of property with the malicious intent to defraud or delay the creditors. In case of fraudulent transfer of property, the debtor intentionally deprived the creditor from his lawful and just entitlements. Mostly, fraudulent transfer occurs in a debtor-creditor relationship. The rules regarding fraudulent transfer of property are recognized under section 53 of Transfer of Property Act, 1882.
The Rules Laid Down by Section 53 of TPA, 1882
Section 53 of TPA, 1882 is comprised of two parts. The first part prescribes the principle that, where a transferor transfers his immovable property with the intention to defeat or delay his creditors, that transfer shall be voidable at the option of any creditor so defeated or delayed. Under section 53 of TPA, 1882 the right of a bona fide purchaser will be protected provided that he acted in good faith and he purchases that property for consideration in spite of the fact that the transfer was made by the seller with intent to defeat or delay the creditors.
The second part of section 53 of TPA, 1882 formulated the principle that, where a transfer of immovable property is made gratuitously or without consideration by the transferor with an intention to defraud the subsequent purchaser, such transfer shall be voidable at the option of such transferee.
The Purpose of Section 53 of TPA, 1882
The main objectives of section 53 of TPA, 1882 are –
- To shield the rights of a bona fide purchaser for value;
- To empower the creditors to avoid any transaction of immovable property made by the debtor/transferor with intent to defeat or delay the creditors;
- To make the assets of the transferor/debtor available to the general body of creditors
Essential Factors Constituting Fraudulent Transfer of Property Under Section 53 of TPA, 1882
- There should be a valid transfer of immovable property;
- The transfer should be a fraudulent transfer of property;
- The transfer should be made with the purpose or intention of defeating or delaying the creditors;
- The motive to defeat or delay the creditors must exist at the time of transfer made by the transferor.
- The suit under section 53 must be bought by the creditor in a representative capacity.
Analysis of Section 53 of TPA, 1882
Who can sue under section 53 of TPA, 1882?
A fraudulent transfer of property can be set aside by creditors only. The subsequent creditors as well as those creditors existing at the time of fraudulent transfer can sue under section 53 of TPA, 1882.
Who are creditors under the meaning of section 53 of TPA, 1882?
- A landlord is creditor in respect of rents due to him from tenant.
- A Hindu wife with a claim for past-maintenance against her husband is a creditor.
- A Muslim wife to whom dower debt is due is a creditor.
- An auction-purchaser, who is not a decree-holder cannot be a creditor but a decree holder who becomes auction-purchaser of the same property is a creditor.
Nature of the Suit Under section 53 of TPA
A creditor in order to avoid a fraudulent transfer of property must file the suit in a representative capacity. The benefit will be incurred in favor of all the creditors. Order 21, Rule 63 of CPC deals with the rules of representative suit.
Intention to defeat or delay the creditors
The intention and knowledge of the transferor are the gist of this section. Section 53 of TPA, 1882 prohibits transaction which removes property from the debtors for the benefit of the debtor. The debtor’s intention must be to benefit himself and to defeat or delay the creditors. Such intention can be proved by circumstantial evidences. From the following factors the court can infer that the transaction is not bona fide –
- Selling all the properties and keeping nothing to himself
- Inadequate Consideration
- Secret Transfer
- Putting all the properties out of the reach of the creditors
Good Faith and Consideration
The purchaser of the property from the transferor must prove firstly, that he had paid a fair and adequate price and secondly, that he was not a party to the fraud. He also has to prove that he acted in good faith. The standards of good faith are –
- There must be an honest dealing between the parties;
- The purpose of the transaction needs to be honest;
- There must exist faithful performance of duties;
- There must be an absence of fraudulent or malice intent.
The term consideration used under section 53 of TPA, 1882 has the same meaning as it has under The Contract Act, 1872. It excludes natural love and affection between the parties.
Defrauding Creditors
The debtor may prefer any creditor he chooses, to discharge the debt. But in doing so, debtor must not retain anything for his own benefit. A mere preference of one creditor to another is not fraudulent under this section. It will not amount to fraud, if debtor wants to shield some property from being proceeded against by creditors while there are other properties from which the dues of the creditors may be realized.
Applicability of Section 53 of TPA, 1882
The section applies in the following cases –
- Hindus and Mohammedans
- Voluntary remissions of debts
- Transfers of movable properties
- Transfer by operation of law
- Partition in joint family
- Surrender of widow’s interest by the widow
The Burden of Proof
Under section 53 of TPA, 1882 the burden of proving that a transfer is fraudulent lies on the creditors as he is attacking the debtor with this section. Once the fact is established by the creditor that the transfer was made fraudulently to defeat or delay his claims then the burden shifts on the transferee to prove that he acted in good faith and he is a bona fide purchaser for value and he was not a party to the fraud. So, the transferee can use this section as a shield for his defense and the creditor can use this section as a sword to attack the debtor.
Effects of Section 53 of TPA, 1882
A fraudulent transfer of property is voidable at the option of the creditors and if they not choose to avoid it, the transfer may be valid between the debtor and purchaser. Where a substantial portion of the transfer is fraudulent, the whole transfer shall be treated as fraudulent. Where only a part of the consideration was debt due to the creditor and the rest of it is fictitious the whole transfer must be void.
Exceptions to Section 53 of TPA, 1882
The section will not be applied in respect of following cases –
- Benami Transactions
- Preference of one creditor to over another
- Fictitious transfer of property
- Auction purchases
- Bankruptcy Laws
- Transfer on account of natural love and affection
- Sham Transaction
Case References
Karim Dad v Assistant Commissioner 1999 MLD 2371
If the whole transaction is based on fraud and misrepresentation then no valid title can be passed to the transferee by using a forged and fabricated deed.
Musahar Sahu v Lala Hakim Lal 1951 43 Cal. 521
It will not be fraud if the debtor chooses to pay one creditor and leave others unpaid provided that he must not retain any benefit.
Bangladesh v Serajul Haque 11 BLC 714
The defendants obtained an ex parte title decree collusively and by committing fraud. The court after discovering the truth set aside their transfer and declared it fraudulent.
Checkout our other Transfer of Property all articles here .
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- Jul 9, 2020
- 10 min read
Types of Land in Ghana and the Acquisition Process
Acquiring land in Ghana may be an easy or difficult process depending on the type of land you want to buy and where the land is located. As simple or complex as it may be, acquiring land is still one of the best investment anyone can do in Ghana as there is a continuous increase in the demand for private and commercial space leading to the constant increase in the value of land and property. These days people commute from areas such as Kasoa, Nsawam, Aburi, Dodowa, Amasaman, Prampram and other suburbs and towns on the outskirts of Accra to work in the heart of the capital. A few years ago this would have been absurd but with the constant works by the government to improve the condition and capacity of major roads this is now possible. Lands in these outskirt areas are considerably cheaper hence the reason why people are choosing to live in further away from their work.
It is evident that owning a property in Ghana has always proven to be a good investment. If you wish to build that stunning property in Ghana there are a couple of things you need to tick off your list. Firstly, foreigners or non - Ghanaians cannot own a plot(s) of land outright but must lease it although freehold land in Ghana is currently very unlikely to come by. Ghanaians are entitled to a leasehold of up to ninety nine (99) years while foreigners have a leasehold of up to fifty (50) years as of the time of writing this article, after which you can renew your lease. Acquiring land in Ghana comes with its own challenges as may be for other parts of the world. Some of these challenges include:
Land Litigation
Many Ghanaian courts frequently deal with several land litigation cases. This is due to instances where land owners have sold a particular plot of land to multiple people or entities. Thereby resulting in protracted litigation. Individuals who acquire land that has been purchased by several others from a specific owner also have to deal with poor court systems and structure. Most often, there are delays in court rulings on land related cases. Some take as long as ten to fifteen years or even more depending on several site specific factors. These individuals constantly have to travel back and forth to court, pay legal fees and sometimes have to deal with the possibility of having to appeal if they find themselves on the losing end. Court appeal can also take years. Thus, if the individual had a timeline for when the building construction on that land had to be completed, that projected end date will go by without the building being constructed, since all works on the site need to be put on hold until the court has made its final verdict. There have been a number of cases where after several years, some litigants have passed away while the issue is still in court. Others also end up losing interest in the land even though they have spent so much on the land and legal fees.
Land Encroachment
Land encroachment is also another major issue in Ghana. There are some unscrupulous persons in the country who have forcefully taken ownership of lands that do not belong to them. Recently Ghana has recorded a rising number of encroachment of school lands. In Accra for example, Achimota School, Christian Methodist Senior High School, Odorgonno Senior High School and University of Ghana have all reported cases where their lands have been encroached upon. Lands belonging to one of the nation’s major hospitals, Korle-Bu Teaching Hospital is not left out in the encroachment saga. In 2011, it was reported that about 30% of the total land of about 2000 acres belonging to the Ghana Atomic Energy Commission had also been encroached upon. There are cases where individuals sell state lands which would have been used for developmental projects to unsuspecting persons. Early this year, the Ministry of Lands and Natural Resources in Ghana disclosed that the ministry has begun a nationwide exercise to reclaim state lands illegally occupied by individuals, organisations and other establishments. Due to this initiative, the Ministry of Lands and Natural Resources has entered into a partnership with the security agencies and Anyok Holdings Limited, (a private development company), to undertake approved demolition exercises and prosecute all persons or entities who have encroached on state lands, particularly in the Greater Accra Region.
Processing Issues
As efficient as the Ghana Lands Commission can be, the government organisation comes with its own shortcomings. Land owners and prospective land buyers are faced with processing issues. There are sometimes delays in processing land documents. Unfortunately, there have also been cases where some officers of the lands commission extort money from clients before processing your documents. This has become a new normal and one is expected to follow suit or else risk having their document sit there unattended for a very long period of time.
Types of Land Ownership in Ghana
Before a person considers acquiring land in Ghana, one must note that there are different types of land ownership in Ghana. Lands do not only belong to an individual, they differ depending on who initially owns the land you wish to acquire. There is:
Stool or Customary Land
Government or State Land
Vested Land
Family Land
Private Land
Stool or Customary Land.
The chieftaincy system in Ghana allows many leaders of different ethnic groups of being the custodial owners of vast lands. Paramount chiefs and sub chiefs can decide who they want to sell a plot of land to and how much they want to sell it for. Some may even decide to be philanthropic and give a plot(s) of land for free for a good cause or for developmental projects that will benefit their people.
For example, in June 2014 it was reported that, Osagyefo Amoatia Ofori Panin, Okyehene, and Paramount Chief of the Akyem Abuakwa Traditional Area in Ghana, decided to release an extensive land belonging to the Okyeman stool, to the City Waste Management Company Limited, to undertake development projects to help solve the unemployment problem in the area.
The state or government of Ghana own lands too. These lands are those that have been acquired by the government of Ghana from traditional allodial owners. These lands are sometimes used for developmental projects and other initiatives by the government.
Vested Lands
Vested Lands on the other hand are those lands owned by the state and customary authorities in a form of partnership. If you wish to buy a vested or state land you would need to file an application with the Executive Secretary of Lands Commission or the Regional Lands Officer in your region. The 1992 Constitution of Ghana details the ownership and use of public lands.
Article 257[1] of the constitution states that: “All public lands in Ghana shall be vested in the President on behalf of, and in trust for, the people of Ghana.”
Article 258[1] provides for the establishment of Lands Commission that shall manage public lands and any lands vested in the President by this Constitution or by any other law or any lands vested in the Commission.
Article 266 also reveals that rights or interest over land shall vest only in the citizens of Ghana.”
As the name suggests, a family land is a land owned by a family. These lands are managed by the head(s) of the family and also assisted by principal members of the family.
Private Lands are lands that are owned by individuals or private entities. Majority of lands found in Ghana are not owned by individuals or private entities. A vast portion of these lands are owned by different chiefs, clans, traditional leaders, stool and families.
There are three main titles under which lands are commonly issued, they are:
Freehold title
Allodial title
Leasehold tittle
Freehold Title
When it comes to Freehold titles, there are two types. They are:
Customary Freehold:
Customary freehold favour the traditional community at large. Individuals or groups can hold interest in a land that is allodially owned by a traditional community of which the interest holders belong to or are members of. It is an interest that is inheritable to successors of the individual or subgroups until there are no successors. This carries on as long as the successors recognises the superior title of the traditional stool. The subject(s) have the right to lease, sell or pledge their title. The one who acquires the land is also expected to acknowledge the superior authority of the stool.
Common Law Freehold
Common Law Freehold and Customary Freehold share some similarities. The only difference between the two is that the interest of the land can be acquired by both non-members and members of the traditional community that own the land. Thus, two Ghanaian nationals from different communities can participate in land acquisition of a traditional community.
Allodial title tops the list as the highest legally recognised land title. However, only the state or government, traditional leaders and families can hold this a title.
As the name suggest, leasehold is an interest in land that details a specific start and end date, subject to payment of annual ground rents and others. Duration of agreement, names of the parties involved, the particular property being leased, terms and conditions for renewal or even non-renewal and other interest are some the items that must be stated on a lease. A stool or clan or family who hold the allodial title or an individual customary freeholder can grant a leasehold.
Now that we know about the types of land of ownership, land titles and also some of the challenges prospective land owners go through in Ghana, let’s find out about the process of acquiring land. Currently there are two common ways of acquiring land in Ghana. You can acquire land through a Real Estate Developer who has acquired a large parcel of land, surveyed and parcelled it into several plots of land. You can also acquire land form private individuals and families.
A plot of land in Ghana is varies, ranging from 70ft x 70ft, 70ft x 100ft, 80ft x 100ft and 100ft x 100ft although in present day Ghana you will hardly find 100ft x 100ft plot of land for sale. So make sure to ask what the size of the plot is when you speak to the estate developer or the private seller. Also plots of land are sold as either serviced or not. Serviced plots are plots of land that have the basic utilities around the site making it easy and less expensive to connect to the national grid, the main water supply and telephone lines. They also tend to have fairly good roads and public drains. These are certainly some of the few things you need to find out before asking about the price as it will help you decide whether you think the land is over priced or not.
Buying from a Real Estate / Property Developer
The easiest way to acquire any land in Ghana is from a real estate or property developer. Many foreigners or non-Ghanaians usually have a hard time trying to buy land in the country, so this will most likely be the least stressful and safest option. These entities provide assistance and answers to any questions or concerns their clients may have. Find a real estate or property developer who has vast experience, a decent reputation and make sure that they are registered with the Ghana Real Estate Developer’s Association (GREDA).
Buying from a Private Seller
Investigate
If you want to go through the process without the help of a property developer, you first need to do your research. When you identify the piece of land you wish to acquire, you need to carry out quite a bit of research such as speaking to neighbours (if any) to identify who the rightful owner is. There have been many scenarios where individuals have been defrauded, and ended up paying for lands from posers instead of from the rightful owners.
Another way to investigate on who the legal owner of the land you wish to acquire is, is also to make a visit to the Ghana Lands Commission. When you are there, do follow the procedure on how to check from their records to find out if the said land owner really owns the land you wish to buy. Valuation can also be carried out. The Ghana Lands Commission demands two copies of the site plan to conduct the search. Unfortunately, potential land buyers must regularly follow up on their request at the Lands Commission since this search can take a longer period.
As stated earlier, state or government lands can be used for developmental projects, hence it is prudent to inquire from government land officials or from the Metropolitan / Municipal / District Assembly (MMDA) under whose jurisdiction the land falls under to find out the zoning status in order to be confident that, the particular land you want to purchase has not been marked out for a government project or some other state development project in the near future.
There have also been instances where prospective buyers put out inquiries in newspapers to find out if anyone would lay claim on the land that they desire to buy or if the land has been registered in someone else’ name other than the supposed owner.
Demand a Site Plan
Before you make any financial transaction, make sure you demand a site plan of the land you want to buy from the owner. The site plan gives you a detailed report of the land, showing the location and dimensions of the land. Ghana Lands Commission or Licensed surveyors usually prepare site plans in Ghana. Site plans help prevent ownership disputes with land guards as the Lands Commission keeps copies in their office
Hire Your Own Surveyor
It is also recommended to seek the services of a licensed surveyor or a registered member of the Ghana Institution of Surveyors. The surveyor will help you verify if the site plan you have correlates with the location, dimensions and boundaries on the ground.
The next step on your journey to acquiring land is to negotiate with the owner of the land. Discuss sale terms, depending on how much you are willing to spend at a time, some land owners may be open to the idea of paying in instalments while others may prefer that you pay outright. The benefit of paying in instalments is that, if there are any discrepancies with the terms or disputes with the acquired land you can rectify them within the flexible time frame.
Draft an Indenture
Upon reaching an agreement with the land owner, the plausible next step is to find a credible lawyer or legal professional to assist in drafting a contract also known as an Indenture. This includes the purchase and transfer agreement. An indenture should include details of the price paid, lease details highlighting the specific parties involved in the transaction, witnesses, ground rent etc.
Make Payment
Payment can be made after an indenture has been prepared and signed by both parties. Do ensure that you make multiple copies of the indenture. It should be endorsed by your lawyer or legal professional. Each copy should have a land surveyor certified site plan attached.
Register the land with Ghana Lands Commission
Now that you are a land owner, make sure you notify the Ghana Lands Commission about the transaction and apply for a transfer and registration of the land. The Lands Commission will provide you with a scheduled date where you can obtain a land title certificate and site plan.
Ensure that you obtain a tax clearance certificate at the Ghana Internal Revenue Service. You are less likely to have litigation issues when you register your land. In situations where a court case or dispute arises, you are more likely to have the upper hand, since it renders your documents admissible in court.
Are you a land owner? If yes, did you go through any stress in acquiring your land? Do share with us your experience in the comments section as well as other tips that can help others. Thank you
Can Foreigners Buy Land In Ghana? Here Is What You Have To Know
Real estate remains one of the top investment opportunities for investors looking to expand their portfolios in the African market. At the moment, real estate in Ghana is booming. But are there special restrictions on those that can get in? This article explains why this is so and why you should consider investing in it. We will also provide a step-by-step process on how to get started as well as the best places to buy land in Ghana.
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If you are curious about real estate opportunities in other African countries, then check out the articles about real estate in Rwanda and Ethiopia using the links provided in this article. Before we take you through the process of investing in real estate in Ghana, here is why we think it is worth your money.
Why You Should Consider Investing In Ghana’s Real Estate Market
Ghana’s real estate has seen considerable growth over the past few years as developers and foreign investment firms like GRIT and REIT continue to show interest in the sector. However, the government has not been resting on its horses but is taking steps to boost foreign interest in the country through events such as the 2019 “Year of Return” campaign.
The campaign attracted 237,000 more visitors to the country in 2019 alone compared to the previous year and injected about $1.9 billion into its economy. Although these figures are being criticized by analysts, the arrival of big companies like Twitter and Toyota sends a positive signal to any well-informed investor.
Putting these all together, the Ghanaian government’s move to build investment trust in the country creates resonating effects across all sectors of its economy. One sector that benefits from this is real estate which saw a rise in its growth rate by 9.1 percent in the first quarter of 2019. If you’re like most foreign investors and excited about this opportunity, it is important to, first of all, know if foreigners are allowed to own lands in Ghana.
Can A Foreigner Buy Land In Ghana?
Yes, as a foreigner you can buy land and other landed properties in Ghana. However, before you rush off to start making plans, there are a few things you should know. First, there are different types of land in Ghana and not all of these can be sold to a foreigner. Also, by law, land leased out to foreigners has a maximum duration of 50 years. After which, the lease has to be renewed. Here are the different types of land in Ghana that you should know about.
Types of Lands In Ghana
In Ghana, lands are classified into five broad categories based on the ownership of the land. They are Customary or stool land, Government land, Vested land, Family land, and Private land.
#1. Stool or Customary Land
These are lands owned by the different traditional rulers in the country. These Chiefs or Paramount rulers reserve the right to sell the land and also determine its price. Acquiring a customary or stool land requires direct interaction with the Chief(s) or Traditional ruler(s) in charge. However, The Office of the Administrator of Stool Lands, a government administration that oversees Stool land negotiations can be of assistance.
#2. Government/State and Vested Land
This type of land is acquired by the government from individuals and traditional leaders. They are most often set aside for government projects. In some cases, the land ownership is shared between the government and the traditional rulers. This type of land is referred to as Vested land.
#3. Family And Private Land
Family land belongs to a family while private land belongs to an individual or group. This type of land is scarce since a vast majority of lands in Ghana are owned by the traditional rulers. When buying this land, it is important to make sure you are dealing with the head of the family in the case of family land. The head of the family usually holds the administrative right over the land. For individuals, it is prudent to do a thorough investigation to find out if you are dealing with the rightful owner of the land.
Guidelines On How to Invest in Ghana’s Real Estate
In this section, we will outline the procedure to follow if you are interested in investing in Ghana’s real estate. Note, while these steps pertain to land, they can also be used if considering other landed properties.
Step 1: Carry out a Proper Investigation
Due to the complex nature of land ownership in Ghana. it is advisable you carry out a proper investigation before going further with a land deal. Some of the steps to be taken during the investigation are;
1. Check the identity card of the seller (it must be a verified ID card issued by the government).
2. Next, you must verify that the following documents are available; indenture or lease agreement; land title certificate; Building permit; and EPA permit. Make sure these documents bear the appropriate names of the seller be it a family, Customary, or even private ownership. If everything seems okay, then you can move to the next step.
Step 2: Check with the Lands Commission in Ghana
After verifying all the documents in step 1, the next step to take is to verify with the Lands Commission in Ghana . The Lands Commission is responsible for land property registrations in Ghana and they will provide relevant information regarding the land you’re about to buy. The information provided by the commission must align with those on the documents in step 1.
Before going to the Lands Commission, also hire a surveyor to give you a site plan of the land. Although this can be provided by the seller, many fraudsters do provide a site plan that isn’t that of the land you want to buy. When all the conditions in this step are satisfied then you can proceed to step 3.
Step 3: Collateral Registry
You won’t want to buy land that has been used as collateral. That is why you have to visit the Collateral Registry. The Collateral Registry records all collateral transactions. This will help you ascertain if the land you’re about to buy has been placed as collateral or not.
Step 4: The Court
Land litigation cases are very common in Ghana because of the complex nature of land ownership and the prevalence of land fraud. Therefore prospective land buyers are advised to check with the court and confirm that the land is not subject to litigation.
Step 5: Spousal Consent
This step is important if the land was acquired by the seller after marriage. In such a case, there is a possibility that the spouse was involved in procuring the land. The property is considered marital property and as such, the consent of the spouse must be sort if the land is to be sold.
Step 6: Contracts of Sale
This is a document that covers the agreement between both parties involved in the land transaction. This agreement should only be signed after the buyer has completed all steps above and is certain to a reasonable extent that the property is clean.
Step 7: Transfer of Assignment or Sublease
An assignment or sublease is a document that contains the site plan of the property being purchased and other relevant documents. Signing the assignment by the seller concludes the transfer of the land or property from the buyer to the seller. Prior to this, the buyer is expected to ensure all relevant documents are provided and handed over by the seller.
Step 8: Registration of Assignment or Sublease
Registration of the Assignment or Sublease is the final step in the process. The buyer is expected to register the assignment with the Lands Commission in Ghana. The steps provided above should serve as a guide to any investor who is interested in purchasing real estate property in Ghana. However, the exact process(es) may differ depending on the type of property being purchased.
Best Locations In Ghana For Real Estate Investment
If you have been following the article closely, then by now you know why Ghana is a choice location for real estate investment. We have also provided a step-by-step guide on how to approach real estate in Ghana. Now, here are some prime real estate locations in Ghana that are worth considering.
Of course, the capital of Ghana is the cream de la cream when it comes to real estate. It’s rightfully so since being the nation’s capital Accra will enjoy an unequaled amount of government developmental projects. Also, many companies will want their headquarters located in Accra and this means a huge demand for office spaces and residential apartments.
Next to Accra is Kumasi also known as the Garden City. Kumasi is the second biggest city in Ghana and also one of the most industrialized states in the country. Kumasi is also a known tourist location with the Kumasi zoo attracting about 51000 visitors in 2019. It’s definitely among the top real estate locations in Ghana.
Located in the Southeastern part of the Nation, Tema has a mix of industrial and residential properties. It is well known for the Tema motorway which is the only motorway in Ghana. And it also has one of the two major seaports in the country. This makes Tema an important industrial hub in Ghana.
Other great locations that are worth considering are Takorai which has the second major seaport in the country, the Port of Takoradi; Amasaman and Kasoa which are quickly becoming industrialized; and Dodowa which is cherished for its calm and serene atmosphere which makes it perfect for residential buildings.
Presently, Ghana is enjoying a lot of attention from foreign companies. The government has provided an atmosphere that encourages foreign businesses and investments. One of the ways it has achieved this is through robust policies and aggressive campaigns.
In this article, we have covered the why, how, and where of real estate in Ghana. Are you a foreign investor looking for how to break into real estate in Ghana, then this article is a great place to begin. If you have any questions, kindly drop them in the comment section below and we will do our best to assist.
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Things To Know When Buying Property In Ghana
Have you ever experienced the relief of waking up from a bad dream to the realization that it’s just a dream? It can be likened to the relief you feel from involving credible and result-oriented Real Estate Companies when looking to buy property in Ghana.
Situated along the coast of the Gulf of Guinea in West Africa, Ghana is a lovely place to be. It’s welcoming, safe, peaceful, hospitable, and colorful. It is an African country that displays the splendor of its beauty in its rich and unique culture, affable people, and mouth-watering cuisine, not to mention its lovely tropical weather. It is one of the best tourism destinations in Africa and an amazing place to live if you wish to re-locate to Africa or spend more time on the Continent.
However, buying property in Ghana is a sport due to the cumbersome nature of land ownership and complicated property registration processes. The processes are tiresome and time-consuming. This is why you need assistance from real estate companies.
TYPES OF LAND IN GHANA
Unlike other countries where land may be owned by the government, much of Ghanaian land is owned by clans, families, and individuals. Land owned by the government is usually for industrial and corporate purposes. The government barely owns and sells residential lands. Land in Ghana is classified into family land, private land, customary or stool–owned, and government land.
Private Land
As the name suggests, private land is owned by individuals and private entities. A vast portion of Ghanaian land is owned privately. Customary land which was bequeathed or sold to individuals and private entities before the 1992 Constitution of Ghana came into being, is now considered private land. These are often managed by the individual or entity without much regulation from the government, save land registration procedures. Hence, when purchasing private land, it is extremely important to investigate by requesting for a search with the Lands Commission of Ghana to ensure that the land actually belongs to the individual or entity you are transacting with.
Family Land
Considering its self-explanatory name, it is clear that family land refers to land owned by families. The administration of family land is overseen by a family head with assistance from leading members of the family. When acquiring family land, it advisable to ensure that you are dealing with a person recognized as the bonafide head of the family which owns the said land. If possible, get older members of the family to confirm the status of the family head and to endorse that they have the authority to administer the land on behalf of the family. Such due diligence could save you years of litigation and financial losses.
Customary Land
Customary Land is owned by the traditional leaders of an area. Its administration is usually overseen by the Chief of that area or community. They have the authority to decide who to sell land to, and at what cost. They also offer land at will for developmental projects which are beneficial to their communities. Securing a piece of customary or stool land involves direct interaction with the traditional leaders or the chief of the area where the land is situated.
Although not owned by the government, the regulatory body which ensures that the transactions regarding the administration and development of stool land the Office of the Administrator of Stool lands. One can obtain assistance from any of their regional, district, and National Offices spread across the country.
Government Land
Government land is land acquired by the government from traditional leaders or individuals more often than not, for developmental purposes. Sometimes, instead of completely acquiring land from its owners, the government partners in its ownership. Such land is referred to as a Vested or state land. It usually not for commercial sale. However, in rare cases, when vested land is up for sale, it can be purchased by filing an application with the lands officer at the land commission office in any of the country’s regions.
PROCESS OF BUYING A PROPERTY IN GHANA.
Despite the complex nature of buying property in Ghana, the advantage is that, landed property is undoubtedly a valuable asset to acquire in the country in this age because of its ever-increasing rate of appreciation with time.
Can a Foreigner Buy Property in Ghana?
Can a foreigner buy property In Ghana? The answer is “Yes”. There are no restrictions on foreigners buying property in Ghana. However, it is important to consider the aforementioned classification of land in the country, as certain land types cannot be owned privately. Land litigation cases are about 80% of all cases in the high court’s so it’s best to follow all the due processes and obtain professional and legal advice when buying land in Ghana.
Lease Periods in Ghana
In the past decade, land laws have been revised such that land can only be leased for up to 99 years and not outrightly sold. Land legislation however allows for land to be leased beyond 99 years in certain peculiar instances. It is important to note that land legislation in Ghana allows for non- Ghanaian to obtain not more than a 50-year lease. A lease is renewable when the time is up. To ensure that future generations do not lose the land when the lease expires, it is important to ensure that the owner of the land state in the transfer agreement that the lease is renewable when the expiry date is near.
BUYING PROPERTY IN GHANA AS A FOREIGNER
The most important action to take is to find out who the rightful owner of the land is, and whether the land is owned out rightly or mortgaged. This can be achieved by requesting for a land search to be carried out on the said land at the Lands Commission of Ghana. A search is a term used to describe a thorough investigation carried out at the overseeing government agency to find out information about a piece of land. An indenture or cadastral plan of the said land is useful in a search, as it provides relevant the technical parameters needed to facilitate a successful search. It is the duty of the seller to provide the buyer of the land with a certified copy of an indenture or a cadastral plan of the land.
How to Do Due Diligence
The information derived from a search includes the location of the land, size, topography, the type of the land, the rightful owner, whether the said land is being disputed upon or not, and whether it is suitable for residential purposes or not. It is important to note that, when buying property in Ghana, every dime spent carrying out a search is worth the expense. Also, exercising patience is key, as the search could take time, usually as much as one month. Although the process may seem slow, spending time to follow the appropriate procedure is rewarding when it comes to Real Estate in Ghana. It will save you years of litigating in court as well as losing your money to unscrupulous real estate agents.
After the search, be sure to do a private survey and draw a site plan of the land to confirm that the communicated size and boundaries are correct. To avoid doubt and falsification of the aforementioned parameters, employ the services of a surveyor yourself instead of leaving it in the care of the seller.
Purchase and Transfer Agreement.
Once every form of due diligence has been done and the buyer is sure that the said piece of land is risk-free and purchase-worthy, it is necessary to draft a transfer agreement to be signed by both parties and their witnesses prior to making payment. This should be done under the strict supervision of a lawyer who will ensure that all legalities are met and there are no loopholes that could lead to litigation in the future. It is advisable to seek legal assistance from a lawyer when buying property in Ghana.
After signing the transfer agreement, a deed of conveyance is prepared by a lawyer to be signed by both parties. This document attests to the fact that the title of the land has been passed on to the buyer.
Depending on the buyer’s financial strength and the agreement between both parties, payment can be made out rightly or by installments. Paying in installments gives the buyer an interesting kind of advantage. It allows for more time to pass such that, any irregularities surrounding the ownership of the land could eventually come up before full payment is made.
Registering Property in Ghana
The final step to take is to register the purchased land with the Lands Commission of Ghana and secure a land title certificate. This could take up to about a year, but it is an important step in a land acquisition that must not be overlooked. A land title certificate to your land is the ultimate land document in Ghana. It literally makes the owner immune to litigation.
Property Tax in Ghana
In Ghana, it is required of property owners to pay property tax. Property tax is an annual levy issued by local government authorities on the estimated value of an immovable property and depending on the location of the property. This usually falls a range of about 0.5% to 3% of the estimated value of the property.
Most real estate companies do not only sell the property but also offer assistance with documentation and payment of civic obligations such as payment of property tax. Hence, when buying property using the services of a real estate company or even an estate agent, ensure to enquire about property tax and other civic obligations owned by the state as a property owner.
Buying from Agents and Developers.
Due to the complexity of the real estate industry, employing the services of real estate companies is highly recommended for foreigners. These companies purchase large portions of land, complete the complex processes associated with land acquisition and resell those lands in simpler processes to individuals. They also build and sell luxury homes and affordable houses mostly within gated communities.
Their services may come off as expensive, but their ability to absolve the complexity, stress and litigation associated with buying property makes it worth every penny. Also, when dealing with real estate companies, one can be sure to buy land or landed property that is serviced and located in a safe and comfortable environment.
Top Real Estate Companies in Ghana include Imperial homes, Buena Vista Homes, Devtraco Plus, Regimanuel Grey Estate Limited, Mannet Court Estate, and Trasaaco Group Limited. The Latest guy on the block is Eden Heights Real Estate Limited.
Eden Heights has for sale, one to 4 bedroom apartments and penthouses located in a safe and serene gated community, West of Accra at unbelievable prices. The company offers a flexible payment plan and also partners which selected top banks across the country to offer mortgage plans to prospective buyers.
The apartments and penthouses at Eden Heights are a complete package. Talk of state-of-the-art ultra-modern finishing, security, prime location, serenity, moderate pricing, the best of amenities, and Eden Heights readily comes to mind. Notable among the luxury offered is an ultra-modern sports facility that comprises two world-class Olympic swimming pools, an evergreen football pitch, and a fully furnished gym. The proximity of this gated community to fancy beach resorts along the Atlantic Ocean makes it even more desirable!
Mortgage Options
A mortgage is a loan secured from a bank to fund property acquisition. It can be assessed whether an individual intends to build or buy a house. Payment of mortgage loans is spread across a number of years, with the average period of payment in Ghana being five years. Most banks which offer mortgages are able to help you chose a suitable mortgage option using a mortgage calculator.
A mortgage calculator is a software that determines the mortgage option suitable for an individual based on factors such as their income, the duration of payment they find comfortable, and the price of the property.
Mortgage options offered by banks in Ghana include Home Purchase Mortgage, Home completion mortgage, Home improvement Mortgage, and Equity Release, to mention but a few. In Ghana, different banks have different mortgage options. Assessing a suitable mortgage facility requires an in-depth understanding of the options available.
First National Bank in association with Ghana Home loans provides customers with different forms of mortgages in Ghana. First National Bank offers three types of home purchase mortgage products.
Home Purchase Mortgage
- First Time Buyer
This product serves the needs of applicants looking to buy their first home. The loan period is up to 10 years for cedi loans and 15 years for dollar loans. The first step is for the prospective homeowner to identify a house that they wish to acquire. Once a suitable house has been identified, the next step is to negotiate the terms of purchase with the vendor and obtain an offer letter for the property. The applicant can then access a Purchase Mortgage from us to buy the property.
This product is offered to applicants who already own a home but wish to buy another investment property for the purpose of renting it out to tenants.
- 100% Purchase
This product serves the needs of applicants looking to buy their first home. The loan period is up to 10 years for cedi loans and 15 years for dollar loans.
Land Purchase Mortgage
This product meets the needs of applicants seeking to purchase serviced parcels of land designated for residential use. Tenure of the loan is up to 3 years for cedi loans and 5 years for dollar loans. A prospective client is to identify the parcel of land, obtain an offer letter from the vendor after agreeing on the terms of sale. The applicant can then apply for a Land Purchase Mortgage from First National Bank.
In addition to the Land Purchase Mortgage, an applicant may also apply for a Home Construction Mortgage to build on their land. This facility allows the applicant, after purchasing the land and with the requisite land documentation, to obtain a short-term construction loan from us to build and complete their property within 12 months . Upon completion of the property, First National Bank will convert the Home Construction Mortgage into a long-term mortgage of up to 10 years for cedi loans and 15 years for dollar loans.
Home Owners Mortgage
First National Bank offers two different types of homeowners mortgages
Equity Release
Homeowners with a demonstrable source(s) of income who wish to borrow on a long-term basis using their home as collateral can access the Equity Release Mortgage. First National Bank offers existing homeowners the opportunity to release equity or other obligations or personal needs.
- Home Improvement
Homeowners with a demonstrable source(s) of income who wish to borrow on a long-term basis using their home as collateral can access the First National Bank Home Owners Mortgage. The bank offers existing homeowners the opportunity to release equity to renovate or extend their property
Save-To-Own Mortgage
The Save-to-Own product is designed for individual clients who have difficulty proving their income according to First National Bank’s regular mortgage standards. With Save-To-Own, you have a great opportunity to service a mortgage by making monthly payments into your account during the savings phase of the product. The product will have two phases :
Savings & Mortgages
Prospective borrowers will be required to make regular payments into a savings account , equivalent to the projected monthly repayment under a future loan amount. These payments will be made over tenors ranging between 12 months and 24 months.
Once a borrower satisfies the savings requirements over the agreed tenor, the mortgage will be disbursed.
12 to 24 months for the savings dependent on applicant profiling and type of mortgage product; based on the Bank’s underwriting criteria.
Up to 15 years for the mortgage after the savings phase.
The amount saved during the savings phase may be used for the payment of facility fees, loan installment payments, or any other purpose as the applicant may deem fit.
Balance of the account may be used as the required minimum deposit for the property to be purchased.
There will be no issuance of debit cards on the account until the second phase of the product.
There will be a dual-staged underwriting process as follows :
- A standard underwriting at the time of the application.
- A review of the first underwriting at the end of the savings phase, to ensure the applicant still meets all lending criteria.
CONCLUSION
Owning a home is a necessity of life. After a hard day’s work, not having a comfortable and relaxing home to go to can be a pity and a pretty bad experience. More especially, for a foreigner. It is essential to have your own home if you intend to permanently live in Ghana or spend long lots of time here doing business or even touring the country. However, outrightly paying for a home in Ghana doesn’t come easy. Here, real estate is quite expensive. Hence payment terms or a mortgage plan which best suits your status is advisable.
The time to own property in Ghana is now. Visit Eden Heights today, Take a tour and make a decision. Your dream home is just a phone call away.
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Foreigners buying apartments in ghana – top questions answered, costs you should factor when buying a property, leave a reply cancel reply.
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- Tips and Advice
Land Ownership in Ghana (Part 1)
- 28 May, 2020
- Tips and Advice , Land
This blog has outlined the different types of land ownership in Ghana. Understanding these as well as our post on how to avoid land litigation will help to prevent any struggles when you decide to acquire land.
Types of Land Ownership in Ghana
Land in Ghana is held from various stool/skin lands , families or clans, which are the allodial owners. Here is a breakdown of the types of land ownership in Ghana
1. Customary Lands
According to Appiah(2011), these lands make up about 80 per cent of all lands in Ghana.
2. Public Lands
There are also public lands, forming the remaining 20 per cent, which is made up of state lands and vested lands.
State lands mean that the state holds this area by acquisition from traditional allodial owners.
Vested lands refer to those plots owned by the state and customary authorities in a form of partnership i.e. split ownership (Larbi, 2008).
Types of Interests on Land
Land can be distributed and leased with various titles:
The allodial title
The allodial title is the highest title in land recognized by law. Only traditional leaders, families or the Ghanaian government can hold such a title.
There are two forms of freehold title interest:
Customary freehold.
This is an interest that individuals or groups hold in a land, which is owned by a larger traditional community – the allodial owner – of which the interest holders are members or subjects. It is an interest that is transferrable to successors of the individual or subgroups until there are no successors.
Common law freehold
Common law freehold is similar to the customary freehold. The difference, however, is that this interest can be acquired by both strangers and members of the community that owns the land. A stranger in this regard refers to a Ghanaian who is not a member of the land-owning community. It is important to note that the 1992 Constitution by article 267 (5) forbids the creation of freehold interests in stool land in Ghana.
Leasehold – A leasehold/lease is an interest in land that has a specified start and end for a period, subject to payment of annual ground rents and covenants.
There are some lesser land interest types created under contractual, share-cropping or other customary tenancy arrangements. Two very common tenancies in the Akan areas are “ Abunu ” and “Abusa” or “ do ma yenkye.” Other areas have different names for these arrangements in the local dialects.
Michael Appiah- Land Disputes Resolution in Ghana- The Role of Customary Land Secretariats (CLS). Case of Gbawe Customary Land Secretariat, 2011
Wordsworth Odame Larbi- Compulsory Land Acquisition and Compensation in Ghana: Searching for Alternative Policies and Strategies (A presentation at FIG/FAO/CNG International Seminar on State and Public Sector Land Management, Verona, Italy, in September 2008)
BJ da Rocha and CHK Lodoh- Ghana Land Law and Conveyancing, 2nd Edition, 1999
Find lands for sale in Ghana on meQasa.
Guest blogger, Kwame Ankapong , a land and property investment consultant, shares his expertise on land ownership in Ghana.
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A Guide To Property Tax In Ghana
What is property tax.
Property tax or property rate is a real estate tax that is calculated on the assessed value of the property. It is known in Ghana as Property Rate. Property Rates are governed by the Local Governance Act, 2016 (Act 936).
What Will Be Taxed?
This tax applies to Immovable structures such as houses, apartments, estates, a mall, skyscraper shops and any other immovable property.
Who Collects Property Tax?
According to Article 245 of the 1992 Constitution, Parliament has to prescribe the functions of District Assemblies. These functions include the levying and collection of taxes, rates, duties and fees.
S.144 of Act 936 states that the District Assembly shall be the only authority to levy rates for a district despite any customary law to the contrary. The metropolitan and municipal assemblies can also administer property rates. Each of the assemblies has its mechanism for collecting the property rate. In Accra, the Accra Metropolitan Assembly is the institution tasked with the collection of property tax. The determination of the property tax depends on the property's estimated value. Thus, some rates may be higher than others, even within the same enclave.
How Is The Property Rate In Ghana Calculated?
The property will be assessed by a representative (valuer) from the Lands Commission to determine the rateable value. This rateable value is then given to the Municipal or District Assembly. The assembly determines a value from the rate impost (an amount per cedi, expressed in decimals and is multiplied by the rateable value to arrive at the property rate)
The district assembly can levy a general rate and a special rate that may be deemed suitable to raise enough funds to cater for the expenditure of the Assembly. According to ACT 936 - The Act guiding property rate in Ghana, A special rate is a basic amount payable by persons residing within the community and are between the ages of 18 and 69. A special rate may also be an amount imposed on an owner of movable or immovable property in the area. However, a District Assembly in fixing the basic rate shall consult with district-level stakeholders in the district.
A person registered as a voter in a district may be required to pay rates imposed by the District Assembly for that district even if the person does not live in the district. Subject to the exemptions from and remission of rates, rateable premises comprise buildings, structures, or similar developments.
The rateable value of premises shall be the replacement cost of the buildings, structures and other structural development that comprises the premises after the deduction of the amount it would cost at the time of valuation to restore the premises to a condition in which they would be as serviceable as they were when new.
The rateable value shall not be more than fifty per cent of the replacement cost for the owner-occupied premises; and not be less than seventy-five per cent of the replacement cost in any other case.
Date and place of payment of rate 148. When a rating authority has given notice of a rate, a person liable to pay the rate shall pay the amount to a rate collector or other person duly appointed or authorised by the District Assembly concerned to collect and receive the rate at the time and place specified by the rating authority.
Exemptions from and remission of rates
The following tenements are exempted from assessment and rating:
premises appropriated exclusively for public worship and registered with the District Assembly;
cemeteries and burial grounds registered by the District Assembly;
charitable or public educational institutions registered with the District Assembly;
premises used as public hospitals and clinics; and
premises owned by diplomatic missions approved by the Minister responsible for Foreign Affairs.
The following persons are exempted from the payment of basic rate:
persons who are in attendance at an educational institution who do not receive any remuneration or income during that period, other than an allowance, loan or other grant provided for purposes of education including any sum received by a person in respect of temporary employment undertaken by the person during vacation from an educational institution
persons who are more than seventy years old.
The rating authority may reduce or remit payment of any rate on account of the poverty of a person liable to pay the rate.
A person who has paid the amount of the rate payable in respect of premises that have been demolished or removed during any financial year may apply to a rating authority to be refunded a proportion of the amount paid that the rating authority considers reasonable having regard to the circumstance except that where the demolition or removal is by order of the District Assembly or a court, a refund shall not be made unless the owner of the premises has given notice in writing to the District Chief Executive within fourteen days after the demolition or removal.
Other Forms Of Property-related Taxes/Payments
Ground rent.
This is a fee paid to the Lands Commission for disbursement to the rightful owners of the land. In the case of Stool/Skin Lands, the disbursement is made to the legitimate traditional owners. This fee is paid annually on all residential and commercial real estate.
Real Estate VAT
In 2015, the government introduced a new tax within the real estate industry. This tax is meant to be an indirect form of Valued Added Tax (VAT). Real estate developers were to pay a 17.5% VAT but upon deliberation with the various stakeholders in the industry, this was pegged at 5%. Even though this new tax has divided opinions, it is expected that the low rate charge will help stakeholders and the general public come to appreciate the long-term benefits of the new tax. The real estate VAT is levied on commercial properties such as hostels, motels and hotels. The real estate VAT does not apply to residential properties.
Paying your taxes does not have to be a dreaded task. Being aware of the purpose of these taxes helps potential buyers and homeowners be mindful of what their tax revenue is being used for. Examples of the uses of property tax include the construction of hospitals, roads, schools, etc. The breakdown of these taxes also makes it clear to the taxpayer, who exactly is collecting these taxes.
At Devtraco Plus, the company services do not end after the purchase. Our offices are available at your beck and call to assist with making payment for the various rates the building owner is obliged to pay.
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Ghana: Useful Guide In Purchasing Land/Property In Ghana
Investing in lands and properties are one of the lucrative ventures in Ghana. Notwithstanding the benefits of acquiring lands and properties in Ghana, it has its own challenges. Due to uncertainty in land ownership system in Ghana acquiring a land which is clean, free from litigation and other encumbrances, can be very daunting.
It is therefore imperative that the prospective buyer or investor undertake proper due diligent to minimize the risk of entering into fraudulent transaction.
CHECK IDENTITY AND THE CREDIBILITY OF THE SELLER
The first crucial point in land purchase is to check the identity and the credibility of the seller. Ascertaining the identity of the seller will ensure that you are dealing with the right person. You can do so by inspecting and making copies of the person Identity card (ID). The ID card presented must be one of the recognized national ID cards. If the seller is a corporate body ensure that the business is duly registered under relevant laws of Ghana. Further investigate their previous property or land transactions. If you are not satisfied with the above, you have to be very cautious in progressing with the transaction.
CHECK THE LEGAL DOCUMENTS COVERING THE LAND
Ensure that the property or land has all the relevant legal documents covering the property. Depending on the nature of land or property, the property or land must have the following documents: Indenture or lease agreement; land title certificate; Building permit; EPA permit etc.
Further it is important that you check the remaining lease of the land or property on the land title document or the assignment. The size of the land should be discussed and it should also correspond with the actual size on the ground.
SEARCHES AT THE LANDS COMMISSION
After examining the documents covering the land or property, the next step is to conduct searches of the land or property at the Lands Commission in Ghana. Lands commission is relevant department in Ghana that undertakes registration of land transactions in Ghana. A search at the Lands Commission will provide details of the land or property you intend to acquire. The information provided should correspond with the documents or details provided to you by the seller.
Searches at the Lands commission are done with the site plan of the property or land. It is always prudent that you instruct your own surveyor to prepare your own the site plan for the search. Fraudsters can easily provide you with a site plan or documents that does not relate to the property or land you intend to buy.
SEARCHES AT COLLATERAL REGISTRY
Another important institution to conduct search is the Collateral Registry. The department registers all collateral transactions in respect of any land or property. Searches at this registry will inform the prospective buyer whether the property has been used for collateral for a loan transaction.
SEARCHES AT THE COURT TO ASCERTAIN PENDING LITIGATION
You have to satisfy yourself that the land is not subject to any form of litigation. Therefore it is important that searches are conducted at the law court to ascertain whether or not the property is subject to any litigation.
SEARCHES AT THE NEIGHBOURHOOD
Transactions on the grounds always moves faster than the transactions at the lands commission, the collateral registering and other relevant authorities. In that regards, it is always important that searches are conducted on the grounds, that's the Neighbourhood.
It can be done by assessing the property, interviewing some of the neighbours and observing the neighbourhood and its environs.
CONTRACT OF SALE
Once you are satisfied that the property is clean and free from any encumbrances; you are dealing with the right person and the property has all the relevant document covering it, the next step is to prepare an agreement covering the transaction. The agreement should capture all the terms agreed by the parties.
CONSENT FROM SPOUSE
It is required by law that spousal consent is required in respect of the transactions covering the disposal of marital property. Therefore you have to investigate and ensure that the required consent has been sought before entering into any transaction in respect of a marital property. Failure to seek the necessary consent may make the transaction null and void.
PREPARATION OF TRANSFER DOCUMENT OR ASSIGNMENT
Properties in Ghana are transferred from one party to the other through a document called an assignment or a sublease. This document contains the site plan of the property, the lease duration, covenants and other terms. Upon preparation of the document and the subsequent signing of it, the property is deemed to have been legally transferred from the seller to the buyer.
It is important that the buyer collects all the previous documents covering the land from the seller. Those documents will be required to assist you with the registration of the property or land.
REGISTRATION OF THE ASSIGNMENT OR SUBLEASE
That final stage is register the Assignment or Sublease at the lands Commission. If the registration is done in the Greater Accra of Ghana, the purchaser will be issued with a land title certificate.
Note that the above are useful guide in purchasing land/property in Ghana. However, some of the transactions may differ depending on the nature of the property or the transaction. It is therefore advisable that you consult an expert in land transactions or a qualified lawyer to assist you with the land transaction.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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Ghana publishes Transfer Pricing Regulations 2020
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Executive summary
Ghana’s Minister of Finance 1 submitted new Transfer Pricing Regulations (new Regulations) before Parliament on 10 August 2020. In accordance with Article 11(7) of the Constitution of the Republic of Ghana, 1992, the new Regulations 2 matured after 21 sitting days for Parliament. Thus, the new Regulations – which also repealed the Transfer Pricing Regulations, 2012 (L.I. 2188) (old Regulations) – entered into force on 2 November 2020.
The new Regulations incorporate many of the revisions introduced by the July 2017 edition of the Organisation for Economic Co-operation and Development (OECD)’s Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations (OECD Guidelines), but with significant variations in certain cases.
The 19 paragraphs and two schedules of the new Regulations introduce significant changes in the compliance obligations for affected taxpayers as compared to the 10 paragraphs of the old Regulations.
This Alert summarizes the key provisions of the new Regulations.
Detailed discussion
Application.
The new Regulations apply to ”arrangements” between “persons who are {regarded as being} in a controlled relationship under...the Act 3 and any other tax law.”
Demonstrating arm’s-length considerations
Allocation of risk.
The definition of what constitutes an arm’s-length transaction has not changed in accordance with the long-established global practice. In line with the new guidance in the OECD Guidelines, however, the new Regulations now specifically require the consideration of the allocation of the economically significant risks in determining the comparability of transactions. Assumption of risk, performance of mitigation functions and financial capacity to bear risk are explicitly required to be considered in determining transfer prices.
Aggregation of transactions
Recognizing the ways of modern business, the new Regulations explicitly permit the aggregation of ”two or more controlled arrangements that are economically closely linked with one another or that form a continuum such that they cannot reliably be analysed separately.”
This is a positive development that should both make compliance more certain for impacted businesses and also make compliance more cost effective.
Intangible property
While the old Regulations provided for transactions involving intangible property, the new Regulations enhance the factors that should be taken into account in determining whether the transactions comply with the arm’s-length standard, including the so-called DEMPE factors – the arrangements regarding the Development, Enhancement, Maintenance, Protection and Exploitation of the intangible asset.
Financing transactions
One new Regulation is dedicated to financing transactions. It contains specific provisions guiding what factors need to be considered in determining an arm’s-length price for a financing transaction.
Among these, it is interesting to highlight that the new Regulation requires interest to be charged on related party trade payables which remain unpaid for 12 months.
Business restructuring
The new Regulations cover business restructurings. The objective is to ensure that, in any transfer of functions, rights, interests, assets and risks between persons in a controlled relationship, the amount received for the transfer reflected the amount an independent person in comparable circumstances would pay.
Documentation
Ghana’s new Regulations, a sequel of the OECD Guidelines, now define the ”Documentation” to be maintained as (a) Master File and (b) Local File, and they are required to be maintained contemporaneously. This is a change from the requirement under the old Regulations to maintain only the ”Local File” as documentation.
“Contemporaneous documentation” is defined as documentation which “…exists or is brought into existence at the time the person is developing or implementing any arrangement that might raise transfer pricing issues.”
Safe Harbors
Taxpayers who are parties to a controlled arrangement with a value of up to US$200,000 are automatically exempted from the requirement to maintain contemporaneous documentation.
Additionally, taxpayers involved in low value-adding intra-group services which satisfy the Commissioner General’s (CG) set criteria may, by written notice to the CG, elect to be exempted from the requirement to maintain contemporaneous transfer pricing documentation.
The third safe harbor for documentation purposes is available by election to persons involved in controlled arrangements pursuant to a technology transfer agreement (TTA) which:
- Is registered with the Ghana Investment Promotion Centre (GIPC); and
- For which the applicable charges are less than or equal to 2% of net profit.
Mandatory disclosure filings
Similar to the old Regulations, the new Regulations require affected taxpayers to submit an annual transfer pricing return no later than four months after the end of each basis period.
The filing of a Country-by-Country (CbC) report is a new compliance requirement introduced by the new Regulations. This requirement will, however, only apply to multinational enterprise groups with annual consolidated group revenues of 2.9b Ghana cedis or above in the fiscal year immediately preceding the Reporting Fiscal Year. On 3 November 2020, when the new Regulations entered into force, the threshold amount was approximately equivalent to €420 million, significantly below the €750 million that is recommended by the OECD Guidelines.
Recharacterization of debt financing as equity financing
The Minister has provided guidance on the factors that the CG should consider in recharacterizing a debt financing as equity financing as he is authorized to do under section 31(5)(a) of the ITA 2015. This will, generally, be triggered during an audit.
No Advance Pricing Agreements (APAs)
The new Regulations, like the old Regulations, do not contain provisions on APAs. Private rulings, therefore, remain the only available route for entities requiring certainty for particularly sensitive or high value related party transactions.
Drafting error
It is important to note a drafting error in the new Regulations. Regulation 13(1) inadvertently refers to the ”requirements of sub-regulation (6)” instead of sub-regulation (7) which contains the requirements for a CbC report. It is anticipated that the Treasury will address this soon.
Implications
The new Regulations introduce significant changes in the compliance obligations for taxpayers. Affected taxpayers should review their transfer pricing compliance procedures to ensure that they can demonstrate the requisite arm-length considerations and meet their documentation obligations.
For additional information with respect to this Alert, please contact the following:
Ernst & Young Advisory Services Limited
- Robin McCone
- Isaac Sarpong
- Kofi Akuoko
Ernst & Young Société d’Avocats, Pan African Tax – Transfer Pricing Desk, Paris
- Bruno Messerschmitt
- Alexis Popov
Ernst & Young LLP (United Kingdom), Pan African Tax Desk, London
- Byron Thomas
Ernst & Young LLP (United States), Pan African Tax Desk, New York
- Brigitte Keirby-Smith
- Dele Olagun-Samuel
Show article references#Hide article references
- The Minister exercised the power conferred on him by subsection (3) of Section 31 and paragraph (a) of subsection (1) of section 127 of the Income Tax Act, 2015 (Act 896) (as amended).
- Numbered as L.I. 2412.
- Income Tax Act, 2015 (Act 896) (as amended) (ITA).
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IMAGES
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COMMENTS
A title or interest in real estate can be transferred from one person to another through the process of alienation. This can be done either voluntarily (that is, with the owner's consent) or involuntarily. A voluntary transfer includes an indenture or deed by testament or will.
To set up an online repository of legal information from Ghana, towards the promotion of Rule of Law, judicial accountability and good governance in Ghana and Africa. To make accessible parliamentary, legislative and judicial information in digital form to the general public.
After paying the stamp duty the documents are stamped and re-submitted to the land registrar to finally effect the transfer into the name of the lessee. Ordinarily, the process of transfer should not last more than three months. Joseph Koba Real Estate consultant and Managing Director of Alisa Properties Email: [email protected]
Registration establishes proof of ownership in such a convenient, simple and easy to read document. Registration makes future transfer of property easier, quicker and less costly. From experience, it is smoother to sell or trade a registered property than an unregistered one.
a. Registration of documents relating to landed property is compulsory in Ghana. b. Registration confers priority on the registrant. It confers priority over all other registrations affecting the same land. c. Registration serves as notice to the whole world that you own the property. d.
The rate of tax for resident individuals who make gains from the sale of property is at a graduated rate from nil to 25% depending on the chargeable income of the resident individual and 20% for a non-resident individual. The individual who falls under a higher tax rate could choose to lower his tax liability by electing to pay a flat rate of ...
200.00. Processing fees for consent to Assign or sublet the whole of residential, civic/cultural, industrial or commercial leasehold. 2.00% of land value. Preparation of a lease for a Petrol filling station (state, stool/skin, vested land) 900.00. Preparation of any License for any temporal use of public land.
The transfer should be a fraudulent transfer of property; The transfer should be made with the purpose or intention of defeating or delaying the creditors; The motive to defeat or delay the creditors must exist at the time of transfer made by the transferor. The suit under section 53 must be bought by the creditor in a representative capacity.
Acquiring land in Ghana may be an easy or difficult process depending on the type of land you want to buy and where the land is located. As simple or complex as it may be, acquiring land is still one of the best investment anyone can do in Ghana as there is a continuous increase in the demand for private and commercial space leading to the constant increase in the value of land and property.
In Ghana, any properties acquired by spouses in their own right remain separate throughout their marriage and do not become jointly owned. If a husband buys property in the name of his wife, the husband is presumed to have intended the property as a gift for his wife.
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Rents can be freely negotiated in Ghana. Rent increases are unrestricted. Deposits According to the Rent Act, landlords can only charge 6 months rent in advance, and succeeding rents are due every six months; however, in practice, landlords charge one to three years rent in advance.
In Ghana, it is required of property owners to pay property tax. Property tax is an annual levy issued by local government authorities on the estimated value of an immovable property and depending on the location of the property. This usually falls a range of about 0.5% to 3% of the estimated value of the property.
In Ghana, acquiring landed property is prestigious, and for many, acquiring a land or building is the fulfilment of a life time's dream. People clamour for property due to their unique advantages. Land and buildings appreciate in value over time, build equity and provide a nest egg for the future. ... Registration makes the transfer of ...
Here is a breakdown of the types of land ownership in Ghana 1. Customary Lands According to Appiah (2011), these lands make up about 80 per cent of all lands in Ghana. 2. Public Lands There are also public lands, forming the remaining 20 per cent, which is made up of state lands and vested lands.
The first implication is that landed property acquired by a person before marriage shall remain independent property of that person after the marriage. This property shall not form part of the joint property of the spouses in the marriage.
Property registration takes around 48 days to accomplish, with around five procedures. Legal fees are regulated by the Ghana Bar Association. The following amounts are prescribed legal fees for conveyance: Stamp Duty Stamp duty is levied on the value of the property at progressive rates, from 0.25% to 1%. Footnotes to Transaction Costs Table
According to ACT 936 - The Act guiding property rate in Ghana, A special rate is a basic amount payable by persons residing within the community and are between the ages of 18 and 69. A special rate may also be an amount imposed on an owner of movable or immovable property in the area. However, a District Assembly in fixing the basic rate shall ...
PREPARATION OF TRANSFER DOCUMENT OR ASSIGNMENT Properties in Ghana are transferred from one party to the other through a document called an assignment or a sublease. This document contains the site plan of the property, the lease duration, covenants and other terms.
Executive summary. Ghana's Minister of Finance 1 submitted new Transfer Pricing Regulations (new Regulations) before Parliament on 10 August 2020. In accordance with Article 11 (7) of the Constitution of the Republic of Ghana, 1992, the new Regulations 2 matured after 21 sitting days for Parliament. Thus, the new Regulations - which also ...
PART III. TRANSFER PRICING METHODS The Transfer Pricing Regulations L. I. 2188 sets out five methods (listed below) for calculating an arm's length consideration for setting transfer prices. Please place against each of the methods the value of transactions where prices have been confirmed by that method (i.e. "tested transactions").