Austria: Amendment to the real property transfer tax law

In November 2012 the Constitutional Court had stated in a finding that the determination of the real property transfer tax law based on the unitary value is not compatible with the Austrian constitution and declared this method as obsolete. At the same time the Court invited the Government to amend the law by 31 May 2014.

Following up on the Court’s decision the Government has recently published a draft expert opinion pertaining to the Act amending the law on the real property transfer tax. Previously the base for calculating this tax was the consideration (i.e. the sales price). In the event where no consideration was paid, such as in the case of donations, inheritance or contribution of assets to a company, the triple amount of the appraised value of the property was applied.

The new rules envisaged in the Government draft make a distinction between purchase within and outside of families. In the new draft the term “family” has been extended. In the event of purchases without consideration within a family, the tax will be calculated based on the triple appraised value of the property which anyhow can amount only to 30% of its current market value. In the event of a transfer of property without consideration outside a family, from 1 June 2014 the tax will be calculated based on the current market value.

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