Austria: Company growth triggers Real Estate Transfer Tax
Yvonne Schuchter-Mang 12 Mar 2020
With its judgement of 9 January 2020, the Federal Finance Court ruled that if an increase in accordance with Section 142 of the Austrian Commercial Code resulted in the penultimate shareholder of a property-owned open company, 3.5% real estate transfer tax would be triggered on the market value of the property.
With its judgement of 9 January 2020, the Federal Finance Court (BFG) ruled that if an increase in accordance with Section 142 of the Austrian Commercial Code resulted in the penultimate shareholder of a property-owned open company, 3.5% real estate transfer tax would be triggered on the market value of the property.
In the case in question, the 5% stake in an open company held by the penultimate shareholder was transferred to the last shareholder, who already held 95% of the company shares, by way of a gift. This donation was reported to the tax office, whereupon this real estate transfer tax was set at 3.5% based on the common value of the property. The complainant contested the decision on the grounds that (i) there was a direct acquisition of the property from the penultimate to the last shareholder and (ii) based on the present gift, the tax would have to be measured at 2% based on the triple unit value.
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