A practical guide to real estate taxes

Practical guide to real estate taxes - purchase, sale, inheritance, donation, divorce and settlement of assets, transfer of co-operative interest​

 

PURCHASE


1 / real estate tax - when buying a real estate during the year, it is necessary to file a real estate tax return before the end of January of the following year and pay tax by the end of May. This tax return is submitted only once, in the following years the tax will be sent to you directly by the tax office in the form of a voucher.

2 / tax on the acquisition of immovable property - this tax must be filed within 3 months after the deposit in the cadastre. The maturity of tax is the same. The tax on the acquisition of the property is 4% of the purchase price.

 

SALE


1 / real estate tax - this tax is payable by the person owning the property on 1 January of that year. The seller then pays it for the year the property was sold, then the buyer will pay it from the following year.

2 / tax on the acquisition of immovable property - until April 2016 this tax has always been paid by the seller. From April 2016 this tax is paid by the buyer. You can be exempt from this tax if you are buying a property within 5 years of the endorsement.

3 / personal income tax - You pay this tax when you own the property for less than 5 years. The deadline for submitting the tax return is before April 1 and the same is the date for payment of the tax. If you leave this tax return to your tax adviser, you can extend the deadline by up to 3 months. The tax is 15%.

 

DONATION


1 / real estate tax - payable annually until the end of May. The tax return is issued by the end of January in the first year after the acquisition of the property. This tax return is submitted only once, in the following years the tax will be sent to you directly by the tax office in the form of a voucher.

2 / tax on the acquisition of immovable property - you do not pay the acquisition tax when donating the property. This tax will apply to you only in case of a real estate acquisition.

3 / personal income tax - if the donation is between the persons in a direct family line (father, mother, sister, brother) or in the secondary line (aunt, uncle, husband, niece, nephew, grandson) the tax does not apply. However, if you get a house or flat from "unrelated", you will unfortunately avoid this tax. A tax exemption applies to an unrelated person only if it is proven that the taxpayer has been living with the person in the household for a minimum of one year.

4 / donation tax - not valid from 2014

 

DIVORCE AND SETTLEMENT OF PROPERTY


1 / real estate tax - will be paid by the new owner of the property, it is necessary to report it to the tax office and change the data at the cadastral office

2 / tax on the acquisition of immovable property - not applicable

3 / personal income tax - not applicable

 

HERITAGE


1 / real estate tax - payable annually until the end of May. The tax return is issued by the end of January in the first year after the acquisition of the property. This tax return is submitted only once, in the following years the tax will be sent to you directly by the tax office in the form of a voucher.

2 / tax on the acquisition of immovable property - inheritance tax does not pay the acquisition tax. This tax will apply to you only in case of a real estate acquisition.

3 / personal income tax - Inheritance between relatives is exempt from income tax. Income tax does not apply to inheritance from unrelated by reference in the will.

4 / inheritance tax - not valid from 2014. However, inheritance management requires higher costs than donations. The reward of the notary who deals with the estate is based on the real estate price.

 

WE SUCCESSFULLY HAVE A SHARED PART


For cooperative dwellings, the situation is different because it is not a property in personal ownership, but only membership rights and obligations are transferred.

1 / real estate tax - in this case the co-residents pay a real estate tax under rent and filing a tax return is handled by the cooperative including payment of the tax.

2 / tax on the acquisition of immovable property - not applicable

3 / personal income tax - the tax does not apply when it exceeds the period between the acquisition of member rights and the transfer of 5 years.

 

Vytvořilo FEO