Intermediary – In many jurisdictions this legal term refers to the figure of a party which usually makes the contact between the parties of a contract, and when talking to real estate purchases, the figure of the intermediary is the real estate agent. Usually the intermediary is a trade figure, but following the current tax legislation in some countries trading as intermediary could enable hiding of taxes & Capital Gains. There are many examples of real estates agents who run their business as intermediaries, but receive their commission fees not in the name of their companies, but in cash, under the table; they do not issue proper VAT-receipts for their commission fees and respectively do not pay taxes, but only put more tax pressure on the client’s back. This is why you should get an independent legal advice before concluding an agency agreement.

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