Sale after rental and subsequent self-use
March 14, 2012 | 30,00 EUR | answered by Michael Herrmann
Dear Sir or Madam,
we intend to sell our condominium this year. The apartment was purchased in 2004, so it is less than 10 years old.
Until 31.03.2010, the apartment was rented out. After that, we used it as our primary residence. The registration certificate shows the registration date as 02.06.2010.
1. From which date are we allowed to sell the apartment without having to pay taxes on the possible profit?
2. Does the condo have to remain the registered primary residence until that date, or can we already be officially registered in a new apartment before then?
Thank you for your response.
Best regards,
Sascha Menzel
Dear inquirer,
First of all, thank you very much for your inquiry, which I would be happy to answer based on the information you provided and in the context of your initial consultation. The response is based on the description of the situation. Missing or incorrect information about the actual circumstances can affect the legal outcome.
The question of personal use in connection with § 23 of the Income Tax Act is regulated in the Federal Ministry of Finance letter of 05.10.2000, paragraph 25. According to this, assets are exempt from taxation on the capital gain if they have been used exclusively, i.e. continuously in the year of sale and in the two previous years, i.e. in a continuous period within the last three calendar years, which does not have to cover the full three calendar years, for personal residential purposes. A vacancy between the end of self-use and sale is not harmful if the asset was used for personal residential purposes in the year of the end of use and in the two previous years.
This means that the conditions are met for a sale in 2012, as the apartment was used for personal residential purposes in the year of sale 2012, in 2011, and also in 2010 (although not for the entire year, but continuously). A vacancy in connection with the sale is not harmful if there is no intention to rent out at any time and the apartment is available for personal use.
I hope that this information has given you a sufficient overview of the situation within the scope of your inquiry and this initial consultation, and remain
Yours sincerely,
Michael Herrmann
Tax advisor
Diploma in Financial Management (FH)
