I just wanted to say to everyone who knew that we were in the process of selling our property (the ex-Hotel Ali Shungu in Otavalo), that it has now been sold and we have now been paid! The tramites were excruciating! One odd thing was that we had to get voting cards to sell the property! But we are not obligated to vote. Inspection, you may say---that sounds easy (I thought at first). But---you just don't get an inspection.....you first go to a notary to have a petition drawn up to present to the municipio to ASK for the inspection, then that sits on someone's desk until an underling 'architect' is sent out to inspect the property, to see if they want to screw you and 'raise' the value.....so then his 'report' goes back and sits on someone's desk until it gets to the Main Architect (in this case, a Frog Woman), very behind, and she said something was missing....I fell to my knees and begged. SO then she signed it after we waited in the office, with 50 other people waiting also for a signature. That is the way it is here---everyone getting pushy. Interesting to note, that when we all started the process, the lady who purchased wanted to hire a lawyer to "walk us all through this" but the lawyer wanted another 1% too! (over 4 grand). I thought that was absurd since lawyers here do not get percentages of land deal values, so I said that we should be able to do it ourselves. (That was before I really knew, as it was, I paid some people to 'help' me along.) Be careful of lawyers who want to charge you a high fee to do a sale or a purchase. Then the buyer always pays the notary--in her case, it was about $500 which was not that bad.
The new owner paid about $4600 in a tax called an "alcabala" (1% of value) and we must pay that amount as well and also we pay 'utilities', a tax depending on how long you have the property.
For example, you buy land and in 2 years you sell, you pay high taxes. Every year the percentage of tax goes down when you sell. It stops after 20 years. So on our main property, we have had for over 20 years, no utility tax, on the adjacent lot we have had for 16 years, taxes to pay, but low. So when doing all this stuff you have to keep a good eye, as the Municipio tried to overcharge us on a $45 fee, and asked for $630. My husband examined it well and found the "mistake." One wonders if they did this on purpose! That very well could be true---someone just hoping that the gringos would not check.
Buyer and Seller each basically pay 1% of the selling price, and the utility tax is interesting to note that it is in effect, I think, to prevent too much flipping going on, so if you are looking to purchase property and flip it within the first year, you will pay a high tax as well as your 1% of property value. Sinice all the properties in Ecuador have been "re-avalued" in the last 10 years, there is little that one can get away with nowadays.
It has been a tedious process to say the least and we are not done yet. We must now liquidate our employees who have been with us for about 20 years, that will come to about $50 grand total, as the longer the employee works for you, the more "severence" they get. If you fire them, you will pay the larger amount and if they choose to leave, you will STILL have to pay them something! Usually lawyers negotiate this if an agreement can't be made. And now we will start to get more documents to get MORE petitions to close our business, change our tax number status, get the employees off of Social Security, cancel and turn over the utilities, phones and THAT one requires a lawyer!..... and about a dozen other things!
Some of this stuff can give you an idea of all the hoops that one must jump through to do anything here now in Ecuador!
One big thing we must do also is have our whole visa changed to reflect another property, another business.....I'll need a rest before starting that one!
So I want everyone to have a toast and think of us as you raise your glass! We are both very happy to be away from this business that required 25 hours a day (for 20 years!). Now I will have some time to travel around Ecuador a bit, as I haven't done that in years!
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