Tax situation when selling land with reallocation
Tax situation in the sale of property with reallocation
A. Facts
1. An agricultural property in an inheritance community is to be sold to the municipality. The sale of two thirds of the area is planned, with the remaining third being able to be sold to third parties by the owners after reallocation (at significantly higher prices) following development. The municipality has stipulated in the contract that a voluntary reallocation involving other affected property owners will take place, and corresponding areas for development measures are to be given free of charge. The municipality will carry out the development, and the seller agrees in the purchase contract to bear the development costs for the remaining area. An official reallocation procedure remains reserved if no agreement is reached.
2. The inherited property was purchased by the deceased decades ago and has been leased for agricultural use until now.
B. Questions
1. Is it correct to strictly avoid voluntary reallocation, as only official reallocation allows for exemption from real estate transfer tax and avoidance of taxation on the increase in value?
2. Would it then be sufficient to let the planned voluntary reallocation fail by not accepting it, or would it be better to already specify official reallocation in the purchase contract?
3. Is the current lease of the property in any way detrimental for tax purposes when selling the main area to the municipality or later the remaining areas to third parties?
4. Is it common and acceptable for the transfer of ownership to take place unsecured 14 days before payment of the purchase price, "because it is a political municipality" (notary text)?
