Tax & Legal

In a most recent decision, the Supreme Tax Court commented on the tax situation of an indirect unification of shares through intermediary partnership in 2012 with respect to the relevant holding for establishing its interest in the related real-estate holding company. The court further held that there is no protection of legitimate expectations with respect to the tax effects of a subsequent judgment of the Supreme Tax Court in 2017.

Following the discussions of the Conference of Finance Ministers of the Federal States, the government has included in the Finance Bill 2019 amended regulations in respect of so-called “share deals” in real estate transactions. Aim of the proposed rules is a tightening of the financial framework around the indirect "transfers" of real estate held through companies and other associations of persons.

The Supreme Tax Court has decided that where an intermediary partnership holds direct or indirect interests in a real-estate-owning company, the relevant holding for establishing its interest in the related real-estate holding company, is its interest in the capital of the partnership and not the interest in the jointly owned property according to the law of property.