Selling a property: speculation tax and the 10-year period

When selling a property, tax can arise on the gain, the so-called speculation tax. It only applies if fewer than ten years lie between purchase and sale and the property was not owner-occupied. Anyone who knows the deadlines and exceptions can often avoid the tax entirely.

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The gain from selling a private property is tax-free if more than ten years lie between acquisition and sale (§ 23 EStG). For owner-occupied residential property the tax even ceases much earlier.

An owner-occupied property can be sold tax-free if you used it for your own residential purposes in the year of sale and the two preceding years, regardless of the 10-year period.

What you should do now

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1. Check the deadlines
Clarify whether more than ten years have passed since the purchase, then the gain is tax-free anyway.
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2. Check own use
Did you live there yourself? With own use in the year of sale and the two previous years, the tax ceases.
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3. Determine the gain
If tax arises, determine the gain (sale price less acquisition/production and sale costs).
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4. Consider structuring
If the sale can be postponed until after the deadline expires or own use can be proven, you save the tax.

How to spot the scam

You sell just before the 10-year period expires and trigger tax unnecessarily.
A brief rental before the sale endangers the own-use exception.
The taxable gain is not declared in the return.

Frequently asked questions

When does tax arise on a property sale?

Only if fewer than ten years lie between purchase and sale and the property was not owner-occupied (§ 23 EStG). After the ten-year period expires, the sale gain on private properties is tax-free.

Does this also apply to my owner-occupied house?

Owner-occupied residential property you can also sell tax-free within the ten years if you used it for your own residential purposes in the year of the sale and the two preceding years. Then the 10-year period plays no role.

How do I avoid the speculation tax?

By waiting out the ten-year period or meeting the conditions of own use. Even a brief rental shortly before the sale can endanger the own-use exception. So plan the timing of the sale carefully.

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General information for self-help, not legal advice (RDG). In case of a high loss or uncertainty: contact a consumer advice center or a lawyer.