Investors who bought hotel units from a real estate developer criticized the latter's sending an attachment to the sale contract, in which he called for transferring the status of the project from hotel apartments to residential units, to avoid paying value-added tax. They indicated to Emirates Today that the real estate developer is chasing them to sign the contract attachment, without providing them with any compensation after changing the status of the project, pointing out that there is a difference in price between the residential unit and the hotel apartment. In turn, the Dubai Land Department said that it is issuing title deeds for real estate based on the completed building, and the building in this case is "hotel apartments", and at the same time it gives every investor complete freedom to benefit from his property, according to the agreements and contracts that have been signed and ratified. Upon them upon purchase or by mutual consent. Emirates Today contacted the real estate developer several times, but he refused to respond to the newspaper's inquiries.
Real estate developer
In detail, the investor, Munira Al Hammadi, said that she was surprised by a letter from a real estate developer from whom she bought a hotel unit in a hotel apartment project, informing her that he would send her an attachment to the sale contract, including a clause to convert the description of the unit that she purchased from "hotel" to "residential", and justified The real estate developer did that by withholding the value-added tax, which was rejected by the tenant, because selling a hotel unit as residential reduces its value when selling. The investor, Majid Al-Zahrani, added that he bought from the real estate developer a hotel unit with specific features, and he did not mention in the basic contract any tax or the possibility of imposing it, despite the fact that the process of applying the tax is clear, which prompted the developer to try to charge it to the investor, by asking him for an annex to the contract to transfer His property from a hotel to a residential one, which harms the investor, because the value of the property will decrease due to the change in the unit classification.
Pay the tax
He pointed out that the problem does not lie in paying the 5% tax rate, but the damage lies in the appendix of the contract that provides for the transfer of the unit from "hotel" to "residential", pointing out that there is insistence on the part of the developer to sign the annex of the contract, noting that he refused Sign the attachment.
The investor (Khamis J), who refused to give his full name, said that the real estate developer sent him several letters, requesting to quickly sign the contract attachment, to convert a hotel unit into a residential unit to avoid paying the tax, adding that he told the company management that he wanted compensation for the price difference Which results from the reclassification of the real estate unit. He pointed out that he demanded that the developer bear the tax, because it was not previously mentioned in the contract.
Transparency of dealing
For its part, the Dubai Land Department said that it “expects all parties to deal with absolute transparency, and to fully adhere to all the terms and conditions that have been agreed upon between the seller and the buyer, and it is known that contracts are a binding document and a reference for litigation, and when any party breaches it, reliance is given. To the laws and legislations that regulate the real estate sector in Dubai, with the aim of preserving the rights guaranteed by the judicial authorities that are keen to apply the highest levels of justice and equality.
The department indicated that it issues title deeds for real estate based on the completed building, and in this case the building in question is "hotel apartments", and at the same time it gives every investor complete freedom to benefit from his property, according to the agreements and contracts that were signed and ratified by Purchase or by mutual agreement.
Rights and Duties
The Dubai Land Department said: “The investor must be fully aware of his rights and duties in accordance with the provisions of the purchase contract, and no party can derogate from these rights, and the competent legal departments in Dubai courts can evaluate these contracts, and make sure that there is any defect in them. And if it becomes apparent to it, provisions will be issued that guarantee the right of the injured party. She explained that she stands at the same distance from everyone to ensure their rights and deal with complete transparency, stressing the need for duly documented contracts.