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Real estate sales: when you have to pay taxes

2020-03-09T03:25:17.690Z


If you want to sell your property, you usually expect certain additional costs. But what about taxes? When does the tax office hold your hand when selling a house?


If you want to sell your property, you usually expect certain additional costs. But what about taxes? When does the tax office hold your hand when selling a house?

Berlin (dpa / tmn) - Anyone who currently wants to sell a property should have little difficulty in finding a buyer. The demand for houses or apartments is often high, so that objects can even be sold at a profit. However, the joy of money blessing can be tarnished if the tax authorities participate.

"In principle, tax exemption applies to transactions within the private financial sphere," explains Isabel Klocke from the Federation of Taxpayers in Germany. But there are exceptions: If the property is sold within ten years of purchase, the profit may be subject to income tax.

Speculation period usually begins with the conclusion of the contract

The so-called speculation period begins on the day the property is purchased. "This is usually identical to the day on which the purchase contract was concluded," said Klocke. "A house that was purchased on March 31, 2010, for example, can be sold from April 1, 2020 without the income tax being charged."

How high the tax is depends on the individual. "Unlike shares or funds, where the flat-rate withholding tax of 25 percent is due, the personal tax rate comes into play when selling a house or apartment," emphasizes Christina Georgiadis of the United Wage Tax Assistance (VLH). "As a result, more than 25 percent of taxes can be due."

exceptions prove the rule

However, taxes are not always due. For example, owner-occupied properties are generally of no interest to the tax office. "The sale is tax-free if the owner has lived in his house or apartment himself in the year of sale and in the two previous years," says Wolfgang Wawro from the German Association of Tax Advisors. The situation is different for rented properties: If they were sold within the ten-year speculation period, taxes are incurred on the profit.

In the case of inheritance, the following applies: "Selling the house in which the parents lived can be tax-free for their children," explains Klocke. If the children move in themselves, there is a special tax exemption in inheritance tax law. If the property is sold, it is usually tax-free because the ten-year speculation period has expired.

Costs can be offset

The calculation of the capital gain is very simple: it is the difference between the sales price and the costs that were incurred in the sale. The costs that can be claimed include, for example, brokerage fees, notary fees, costs for land registry entry, real estate transfer tax and advertisement costs.

It is possible to offset profits against losses. "However, profits from property sales cannot be offset against income from other types of income, such as wages or income from self-employment," said tax adviser Wolfgang Wawro. "But if you buy a new one after selling a property, for example, you can reduce your taxes by depreciation."

Note the limit to commercial real estate trading

Anyone doing several real estate transactions within a short period of time can quickly be suspected of trading commercial real estate. "In the case law, the sale of up to three properties is still considered a private sale," said Klocke.

However, a commercial property trade can already exist if there was an intention to sell from the beginning. "If a commercial property trade is accepted, the ten-year period does not apply. Then the sale of the property is an operational process that is subject to income and trade tax."

Source: merkur

All life articles on 2020-03-09

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