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Value added tax on the sale of a house?

June 8, 2015 | 30,00 EUR | answered by Anton Pernitschka

Does value added tax apply when a GmbH sells its previously self-used house (single-family house on foreign land) to its two shareholders (current and future property owners)?

Anton Pernitschka

Dear inquirer,

In the context of an initial consultation and your fee contribution, in accordance with the regulations of this forum, I would like to answer your question.

According to § 4 No. 9 a UStG, turnover that falls under the Real Estate Transfer Tax Act (GrEStG) is exempt from value added tax.

According to § 1 GrEStG, real estate transactions relating to domestic properties are subject to real estate transfer tax. If a domestic property is part of a company's assets, a transaction that grants the right to transfer at least 95% of the company's shares directly or indirectly is subject to tax.

If these conditions are met based on the facts presented, the sale of the property is subject to real estate transfer tax and no value added tax is applicable.

The answer is based on the information provided. Missing or incorrect information about the actual circumstances may affect the legal outcome.

Best regards,

Anton Pernitschka
Tax consultant