Calculation of inheritance tax for a partially self-occupied rental property
November 23, 2020 | 50,00 EUR | answered by Steuerberater Knut Christiansen
We have inherited two rental houses from our parents among the three of us. The settlement is excluded in the will for 30 years. There are a total of 10 apartments. Of these, 4 are occupied by the heirs, for over 30 years, one heir occupies 2 smaller apartments in one house. How is the inheritance tax calculated now? Market value, income value, comparative value (the actual rents received?) The heirs do not pay and have not paid rent for their apartments. Is this somehow recorded? What else can be deducted?
Good day and thank you for using ask-a-pro.com!
I would like to answer your question as part of an initial consultation.
If it concerns rental properties, the properties would be valued using the income approach. In this case, if no rent is being paid, the usual rent (comparable rent on the market, possibly according to the rent index) would be used as the basis. This way, the property is valued from the perspective of the tax authorities as realistically as possible, because a usual rent is used for the valuation.
Deductible here would be the assumed loan obligations, if any. Rental properties are generally valued at only 90% of the inheritance tax value. However, assumed debts can also only be deducted at 90%.
As children, each of you is entitled to a tax-free allowance of 400,000 EUR per parent. If the value of the properties is significantly higher, I would recommend that you hire a tax adviser for the inheritance tax declaration.
I hope this answers your question, otherwise feel free to contact me again.
Please note that only a preliminary tax assessment can be made here. Missing or incomplete information can change the legal outcome.
Best regards,
Knut Christiansen
Tax Advisor
