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Private real estate sales in the context of succession cases and own-use

Recently, a number of new court rulings with respect to private sales transactions involving real estate were disclosed. The courts ruled on whether […]

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Five-year period and three properties limit – Criteria for commercial trading in property

When a property is purchased and sold shortly afterwards this could give rise to a taxable capital gain. If there are several properties then the […]

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A tenant’s entitlement to reimbursement under the German Carbon Dioxide Cost Allocation Act

The Carbon Dioxide Cost Allocation Act (Kohlendioxidkostenaufteilungsgesetz, CO²KostAufG) has introduced an entitlement for tenants to reimbursements […]

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Is living space illegally repurposed when it is used by holidaymakers?

When rental apartments are rented out via online portals there is a risk that the actual use of the living space will be different to the one that was […]

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Shorter useful life – How faster tax depreciation of real estate can be achieved

Fixed tax depreciation rates based on standardised useful lives mean that real estate users have only limited scope to provide proof of an actual […]

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Sale of properties held as private assets – Recognise and avoid the tax pitfalls

Capital gains on personal property are not generally subject to income tax. Even the capital gain on a property that was used to generate income from […]

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Compensation payments made to tenants as immediately deductible expenses

According to a ruling recently issued by the Federal Fiscal Court (Bundesfinanzhof, BFH), payments made to tenants to compensate them for moving out […]

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Withholding tax for construction services and its tax risks for businesses, lessors & Co.

The German fiscal administration recently revised its approx. 20-year-old circular on the application of withholding tax for construction services in […]

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Refurbishment expenses that can be immediately deducted after withdrawal of a residential property

If extensive maintenance and modernisation measures are carried out at rental properties within three years of acquiring them then there would be a […]

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Tax-exempt sale of property – Self-use in the year in which the sale takes place is essential

If property that is held in private assets is sold before the end of the ten-year speculation period then the appreciation in value that is realised […]

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Tax-optimised transfer of own home to relatives

In the case of inheritance, while it is possible to transfer an owner-occupied home to the remaining spouse free of inheritance tax, nevertheless, […]

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Property valuation – Important changes to the German Valuation Act in the 2022 Annual Tax Act

The draft of the 2022 Annual Tax Act (Jahressteuergesetz, JStG) contains – besides many other changes (please see our previous report) – amendments to […]

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Property purchases – New guideline for the apportionment of the purchase price

Those who buy rental properties are generally interested in allocating as high a share of the purchase price as possible to the building because only […]

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Hidden defects – No warranty claims will arise after a house purchase in the event of insulation defects

Warranty rights are generally excluded in house purchase agreements. In the case of so-called hidden defects, which the vendor is aware of, other […]

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Terminating a tenancy for own use

In many cases where tenancies are terminated for own use, the courts rule in favour of the tenants. However, if the landlady provides alternative […]

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Cosmetic repairs – Obliging a tenant to renovate is only possible to a limited extent

Last year, the so-called renovation clause received a lot of media attention on account of a ruling by the Federal Court of Justice […]

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In the case of properties, do step up models constitute a form of abusive structuring?

Frequently, in the case of property that is rented out and held as taxable assets, the tax depreciation volume has been used up, or the amount of […]

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Trade tax exemption – A question of proportionality

Companies that exclusively manage their own real estate are able to file an application to make a reduction to their trading profits so that, […]

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Developed real estate – New guideline on the apportionment of the purchase price

When purchasing a rental property, it is generally advantageous for landlords if the local tax office allocates as high a share of the purchase price […]

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Renting to close relatives – The average market rent for the local area as an objective benchmark

Income from the letting and leasing of immovable assets and rights also includes, among other things, renting out residential property – frequently at […]

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