Do I also have to pay taxes on income from leasing land?
August 12, 2022 | 40,00 EUR | answered by Johann Lauer
Dear tax advisor,
My name is Alwin Otten and I operate the leasing of land. In this context, I generate regular income from renting out my land. Now I am wondering whether I also have to pay taxes on this income.
Currently, I am unsure whether the income from leasing out land is taxable or if there may be exceptions. I want to make sure that I fulfill my tax obligations correctly and do not violate any laws.
Therefore, it would be very helpful for me if you could provide me with more information on this topic. Are there specific regulations or exemptions that can be applied to income from leasing out land? What tax aspects do I, as a landlord of land, need to consider in order to avoid making mistakes and paying unnecessary taxes?
I thank you in advance for your support and look forward to hearing from you.
Sincerely,
Alwin Otten
Dear Mr. Otten,
Thank you for your inquiry regarding the tax situation when leasing land. As a tax advisor specializing in rental and leasing, I would be happy to assist you and explain the relevant tax aspects to you.
Income from the rental or leasing of land is generally taxable and must be reported in the income tax return. The income generated is treated as income from rental and leasing (§ 21 Income Tax Act) and is subject to income tax. It is therefore taxed at the personal tax rate.
However, there are certain regulations and allowances that can be applied to income from leasing land. For example, expenses related to the rental can be claimed as deductions to reduce the tax burden. These may include maintenance costs, management fees, insurance premiums, or depreciation on the rental property.
Furthermore, there is the option to tax the income from leasing land on a lump sum basis. In this case, you do not need to prepare an income-expenditure account or provide detailed receipts of your expenses. This can be a simplified and time-saving solution in some cases.
It is important, however, to carefully consider all tax aspects to avoid errors and unnecessary taxes. As a landlord of land, you should therefore keep all relevant receipts and documents carefully and consider seeking advice from a tax advisor to fulfill your tax obligations correctly.
I hope this information is helpful to you and I am available for any further questions. Thank you for your interest and attention.
Sincerely,
Johann Lauer, Tax Advisor
