HOW HIGH IS THE REAL ESTATE TRANSFER TAX WHEN BUYING PROPERTY?

Real estate transfer tax is due when a plot or property is purchased. It currently ranges from 3.5% to 6.5%, depending on the federal state. In Hesse it is currently 6.0%.

FOR WHICH PROPERTY CONTRACTS IS REAL ESTATE TRANSFER TAX DUE?

Here are some examples of acquisitions for which real estate transfer tax is due:

• Purchase contract for a plot
• Exchange contract for plots
• Highest bid at a foreclosure auction

There are also exceptions. Some examples of acquisitions for which no real estate transfer tax is due:

• The value of the acquisition is below EUR 2,500.
• Purchase by the seller's spouse
• Purchase of a property by the former spouse in the division of assets after a divorce.

USEFUL KNOWLEDGE ABOUT REAL ESTATE TRANSFER TAX

The basis of assessment for the tax is the purchase price. However, the value of accessories or movable items sold with the property can be deducted, as these are not subject to real estate transfer tax. The items and accessories must be listed precisely in the purchase contract and their value stated.

When acquiring a condominium, you should also record the proportionate maintenance reserve in the purchase contract, as it is also exempt from real estate transfer tax. You can find out the current amount of the reserve from the property manager.

The buyer has one month after notification of the tax assessment to pay the real estate transfer tax. Only once the tax has been paid will he be entered in the land register. To allow the entry to be made, the competent tax office issues a so-called clearance certificate (Unbedenklichkeitsbescheinigung).

Both the buyer and the seller are liable to the tax office for the real estate transfer tax, even if the purchase contract states that the buyer bears it.

If the buyer withdraws from the purchase contract for any reason, the tax office will refund the real estate transfer tax already paid.

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