Three-Object Boundary
December 21, 2020 | 25,00 EUR | answered by Steuerberater Knut Christiansen
I own 6 apartments in a house.
I acquired these apartments in a package deal.
There is another apartment in the house that does not belong to me.
Now, I want to sell all 6 apartments to one buyer at the same time.
I am concerned about the "three-object limit".
I am acting as a private individual and have not sold any properties in the last 5 years.
Will this sale of 6 apartments be counted as one property or as 6 separate properties?
Good day and thank you for using frag-einen.com!
I would like to answer your question as part of an initial consultation and taking into account the fee you have provided.
In general, a letter from the Federal Ministry of Finance regulates to what extent a commercial real estate trade is present. Among other things, it says:
Every civil-law condominium that is independently usable and marketable constitutes an object within the meaning of the "three-object limit", even if several objects are structurally combined into one object after the conclusion of the contract (see Federal Fiscal Court judgment of May 16, 2002, BStBl II p. 571). The same applies to properties where the sale failed at the time of contract execution (see Federal Fiscal Court judgment of December 5, 2002, BStBl 2003 II p. 291).
So if your apartments are individual apartments (partial ownership/residential property with their own land registers), each apartment would be a countable object. The sale of these apartments would then lead to a commercial real estate trade (exceeding the 3-object limit) if you have not already rented them out for more than 10 years. Because it also says in the letter from the Federal Ministry of Finance:
If developed properties have been rented out for a long period of time (at least ten years) until the sale, the sale of the developed properties generally still belongs to private asset management (see Federal Fiscal Court judgment of April 6, 1990, BStBl II p. 1057). This is independent of the extent of the real estate sold.
So it is also crucial when you acquired these 6 apartments.
I hope this answers your question, if not, feel free to ask more questions at no extra cost.
I would like to point out that this forum cannot replace a detailed and personal tax consultation, but is mainly intended to provide an initial tax assessment. By adding or omitting relevant information, the legal assessment of your issue could differ.
Best regards,
Knut Christiansen
Tax consultant
