Division of rental income after donation
February 10, 2012 | 30,00 EUR | answered by Michael Herrmann
On the advice of the notary and the tax office in Hildesheim, we should seek tax advice for the following questions.
My wife will be gifting me half of her MFH in the next few days. We will be jointly assessed. The annual rental income (approximately 40,000 EUR) will be attributed solely to my wife - she also receives the age relief amount. I only receive a retirement pension. I have been managing the accounting and annual tax return with TAXMAN from Haufe for years - so far without objection from the tax office. Taxation is based on splitting. The MFH is not self-occupied.
By the way, I was a master craftsman as a sole proprietor for over 40 years, and therefore, for security reasons, I agreed to separate property with my wife in 1967. However, for estate law reasons (we have two adult children), some things should now change since I am retired.
My question: Can I split the rental income and expenses in the tax return after the gift? Will I also receive the age relief amount due to the half rental income?
Dear inquirer,
First of all, thank you very much for your inquiry, which I would be happy to answer based on the information 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 donation of half of the property creates a joint property community for tax purposes. The income is to be attributed proportionately to the participants in the community. In the case of joint assessment, there is nothing further to do other than to indicate in Annex V that the property belongs to both spouses. In the tax assessment, the income will then be allocated equally.
If you have reached the age of 64 and have additional positive income, such as from renting or leasing, in addition to your pension, you are entitled to the age relief amount. This amounts to a maximum of 40% (depending on age) of the rental income and a maximum of 1,900 euros.
I hope that these details have provided you with a sufficient overview of the situation in the context of your consultation and this initial advice, and remain
Yours sincerely
Michael Herrmann
Tax consultant
Diploma in Financial Management (FH)
