Giving away real estate - what taxes are incurred?
January 27, 2021 | 30,00 EUR | answered by Steuerberater Knut Christiansen
What tax costs are incurred in the case of a property gift?
My parents want to give me a property. The value of this property is approximately 260,000€ and it has been in their possession for 6 years. I currently use the property myself and this should remain the case after the gift. Since there is still a loan running on the property, we have asked the bank for approval, but they advised against making the gift, as otherwise speculation tax would apply. According to my research, this is not the case and there should also be no gift tax, as the value is below 400,000€. Therefore, the question above is what we should expect.
Good morning and thank you for using frag-einen.com!
I would be happy to answer your question as part of an initial consultation.
The bank is correct here: if you take over the loan when acquiring the property from your parents, there is a consideration involved. This would mean that your parents are making a partially remunerated disposal transaction (loan amount in relation to property value). Whether this results in a profit would need to be examined, especially in terms of clarifying the acquisition costs for your parents. The fact is that in principle a speculative transaction would take place, which is generally subject to income taxation (§ 23 EStG).
There would be no gift tax implications here, as the value of the gift is below 400,000 EUR (exemption amount).
I hope this answers your question, if not, please feel free to reach out again.
Best regards,
Knut Christiansen
Tax consultant
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