Tax treatment of vacation homes and apartments
August 26, 2012 | 30,00 EUR | answered by Dr. Yanqiong Bolik
I intend to establish a sole proprietorship.
Activity:
- Rental of own holiday apartments to holiday guests
Expected turnover:
- more than 20,000 euros / year
- therefore I am subject to VAT
Questions:
- How is it in case of a possible sale of the apartments?
Is the profit (selling price - purchase price) still taxable after 10 years?
- Do own apartments, which are also in my possession and rented out to long-term tenants, remain exempt from VAT or are they also subject to VAT (annual rent more than 17,500 euros)?
- Are the rents from the rental of holiday apartments and the rents from the rental to long-term tenants considered together or separately for tax purposes?
- Company car for the above-mentioned sole proprietorship
- Does a certain percentage of business use need to be proven in general?
- or is this waived if 1% taxation is carried out?
- Can assets up to 410 euros net be immediately written off again in 2012/2013?
Dear inquirer,
Thank you for your inquiry, which I will gladly answer taking into account your input and the rules of this platform.
Please note that my explanation is based on the facts presented, and that adding, omitting, changing information, or the ambiguity of the information can change the tax result.
- I intend to establish a sole proprietorship. Activity: • Renting out own holiday apartments to holiday guests
Based on the facts presented, I assume that you intend to generate income from a commercial accommodation business. Please inform me if this assumption is not correct, as the tax consequences could potentially be altered.
- What happens when selling the apartments? Is the profit (selling price - purchase price) still taxable after 10 years?
The holiday apartment is considered necessary business assets. Capital gains (sales proceeds - remaining book value - selling costs) are generally taxable income, even if the sale occurs after 10 years.
- Do own apartments, which are also owned by me and rented out to long-term tenants, remain VAT-exempt or are they also subject to VAT (annual rent more than 17,500 €)?
Renting out apartments that are not used for short-term accommodation of strangers is VAT-exempt, even if the annual turnover exceeds 17,500 EUR.
- Are the rents from renting out holiday apartments and rents from renting to long-term tenants considered together or separately for tax purposes?
It depends on whether the rental to long-term tenants is managed through private asset management or as part of the sole proprietorship. If the apartments are rented out to long-term tenants as part of the sole proprietorship, the profits are considered together for income tax purposes. For VAT purposes, the revenues are considered separately.
If the rental to long-term tenants is managed through private asset management, the surpluses from this rental are considered rental income. The surpluses are considered separately for income tax purposes from the profits of the accommodation business.
- Company car for the above-mentioned sole proprietorship -Is a certain percentage of business use generally required to be proven? - or is this waived if the 1% taxation is applied?
The car must be used for business purposes at least 10%. With the 1% rule, proof of use with a logbook is not required.
- Can assets up to 410 euros net be immediately written off in 2012/2013?
Yes, if the assets are depreciable movable fixed assets of the fixed assets that are capable of independent use.
I hope that I was able to assist you.
If there are still uncertainties, please feel free to use the follow-up function.
Sincerely,
Dr. Yanqiong Bolik
Tax consultant
Bildstöckle 6, 70567 Stuttgart
Tel: +49 (0) 711 / 2132 1815
Email: info@zdbz.de
www.steuerberatung.zdbz.de
