Sale of building plots
August 6, 2010 | 20,00 EUR | answered by Matthias Wander
An elderly couple wants to sell a building plot worth 360,000, which has always been in the family's possession. Will they have to pay taxes on the proceeds, if so how much?
Dear inquirer,
Thank you for your inquiry, which I would like to answer based on the information provided and in the context of your circumstances as part of an initial consultation.
If the property is classified as business assets, any capital gains will be subject to taxation.
On the other hand, if the property is considered private assets, the capital gains will only be taxed if the period between acquisition and sale of the property is less than 10 years.
Furthermore, it is important to consider whether the property in question is classified as a commercial property trade. This depends on whether the property is developed for sale before the transaction. If the property is developed for sale (e.g. infrastructure, subdivision) before the transaction, it is advisable to consult a tax advisor. In commercial property trading, profits are always subject to taxation.
I hope this gives you a brief overview.
Kind regards,
Wander
Tax Advisor
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