Real estate transactions often involve thorough examinations of their tax history.
Our firm frequently provides tax and legal advisory services in real estate transactions. This applies to both land plots and buildings or premises. Clients' concerns range from sales transactions to contributions in kind, co-ownership dissolution, or donations.
By nature, real estate has significant value, which can lead to substantial tax liabilities arising from transactions. We strongly recommend conducting a tax analysis before completing a transaction, as the tax implications should be considered not only in terms of income taxes but also in terms of VAT (e.g., VAT exemption issues, first occupation, property or land classification for VAT purposes, and possible retroactive adjustments of input VAT).
Real estate transactions are also subject to civil law transaction tax (PCC), which is calculated based on the property's value, representing a significant burden for the buyer.
Another key issue in real estate is rental or lease agreements. This area raises many questions and can have various tax consequences depending on the agreement, the chosen taxation method, or the status of the lessor (individual or company).
Real estate also encompasses questions related to construction, developer agreements, trading in property expectations, or so-called "flipping."
Moreover, real estate is subject to property tax. Recent years have brought significant debate over the definition of buildings, ownership by entrepreneurs versus their use in business activities, with rulings from the Constitutional Tribunal shedding new light on these issues. Yet, new challenges and disputes regarding this taxation continue to emerge.
Regardless of your level of involvement in the real estate market, we invite you to contact our tax advisors.
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