Sale of commercial property in a GmbH.
January 29, 2013 | 30,00 EUR | answered by Wirtschaftsprüfer André Hintz
Hello,
in our company, there is a commercial building from the 1950s with a book value of 1 euro. The main source of income for the company is renting out this commercial building. We are considering selling the property due to the fact that the value of the property is expected to decrease in the coming years. If the property is sold, hidden reserves (e.g. 100) would need to be uncovered and subsequently the company would need to be liquidated. Question 1) What are the tax consequences for the shareholders of the company in case of a sale and liquidation of the company? The shareholders hold the shares in their personal assets. Question 2) If the property is sold but the company is not liquidated and instead the proceeds from the sale are reinvested in another property within the framework of a 6b deferral, what are the tax consequences in this case? Question 3) Are there any alternative tax recommendations for this scenario?
Dear inquirer,
I would like to answer your question within the scope of an initial consultation and in accordance with the rules of the online portal, taking into account your fee commitment. My response is based on the situation you have presented.
Question 1)
If the property is sold, it constitutes ongoing profit for the GmbH. This profit is subject to corporate tax and trade tax. The remaining amount can be distributed as dividends (minus capital gains tax and solidarity surcharge).
The liquidation results in a taxable capital gain for shareholders with more than 1% (in the last 5 years) (liquidation is treated as a sale). The acquisition costs and possibly a tax deposit account must be taken into account. This also includes a tax-free allowance that is to be granted proportionally, but decreases once the capital gain exceeds 36,100 euros.
Whether it is more advantageous to pay out the money as dividends or subject it to capital gains tax depends on your personal tax rate.
Question 2)
Creating a reserve according to § 6b of the Income Tax Act leads to the fact that hidden reserves are not immediately taxed. These are transferred to the new asset. This may reduce future depreciation amounts on buildings and will be taxed over the term.
It should be noted that a new asset must be acquired within 4 years, otherwise 6% interest will be due per year.
Question 3)
An alternative always depends on your personal circumstances and goals. A general statement cannot be made.
For example, if you were to purchase the property from the GmbH, you could then sell the property tax-free after 10 years. During this time, you would generate taxable income from rental and leasing. However, the costs of the GmbH would be eliminated during this period.
For questions and further assistance, I am available via email.
I hope my explanations have been helpful to you and remain
Yours sincerely,
André Hintz
Tax advisor
Steuerberatung@andrehintz.de
