In a most recently published decision, the Supreme Tax Court held that real estate transfer tax falls due on the acquisition by a company of its own shares if this led to a holding of a little over 95% (90%) of the issued share capital in the hands of one of the shareholders.
In two parallel decisions the Supreme Tax Court held that a group of natural persons who are not organized in the legal form of a partnership or another corporation is not considered as a legal entity under civil law and real estate transfer tax law and cannot therefore be a controlling company within the meaning of Section 6a Real Estate Transfer Tax Act which provides tax exemption for transfer or concentration in the hands of a single shareholder of at least 95% of the equity capital of a property-owning company.
In a recently published decision, the Supreme Tax Court commented on the repurchase of shares in a property-owning company where the previous acquisition was not subject to real estate transfer tax. Another case decided on the same date concerned the annulment of a chargeable transfer (concentration of 100% of the shares in the property-owning company) which later was reversed a second time restoring the initial level of shareholding.
In an interim decision, dated 9 July 2025 (II B 13/25 (AdV) and published on 31 July 2025, the Supreme Tax Court considered it doubtful, following a summary examination, that in cases where the contractual acquisition transaction (signing) and the transfer of the shares (closing) take place at different times, real estate transfer tax can be assessed twice – namely once upon signing under Section 1(3) No. 1 of the German Real Estate Transfer Tax Act (“RETTA)” (signing) and once upon closing under Section 1(2b) RETTA – if the tax office is aware at the time of assessment for the signing that the closing has already occurred.
The Supreme Tax Court decided that the contribution of all shares in an indirectly property-owning company by a corporation under Irish law to the plaintiff against consideration is subject to real estate transfer tax pursuant to Section 1 (3) Real Estate Transfer Tax Act. The exemption on intra-group restructures (conversions) under Section 6a Real Estate Transfer Tax Act was not available.
In a most recent decision, the Supreme Tax Court held that the unification of shares resulting from the transfer of shares in a property-owning corporation to a Dutch foundation is not exempt from real estate transfer tax pursuant to Section 5 (1) RETT Act if the comparison of legal types reveals that the legal structure of the foundation is not comparable to a joint ownership under German law.
The Federal Ministry of Finance is planning to introduce a bill based on the proposals made by the Finance Ministers' Conference in November 2018 in relation to the Real Estate Transfer Act (RETT Act). It is currently envisaged that the changes, which are likely to be discussed in the Cabinet at the end of April 2019, should be included in the Finance Act 2019.
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.
