Tax on the Sale of Real Property

Many questions of a legal nature may arise in connection with the sale of real property, among other things because the profit from the sale of real property is exempt from taxation in certain cases.

According to the so-called detached-house rule (parcelhusreglen), you can sell your house or apartment tax-free if the property was your home as the owner. In addition, it is a condition that the plot is smaller than 1,400 m2 or that the plot cannot be parcelled out.

Holiday homes may also be sold tax-free provided that the owner has used the home for private purposes for part or all of the period they have owned it.

If you have a farm, a special farmhouse rule (stuehusregel) applies, under which the part of the capital gain attributable to the farmhouse is tax-exempt.

For most home owners, the tax implications of selling a house or holiday home are mere formalities which do not give rise to special questions. But what about a situation in which you own two permanent residences and perhaps several holiday homes? Can you sell all the properties tax-free? And what about the apartment you bought for your daughter when she went to university? How should it be treated for tax purposes? And what is the situation if the plot is larger than the permitted 1,400 m2. No tax exemption then?

You may find yourself looking for answers to a lot of questions pertaining to the sale of real property. TVC Law Firm can help you prior to a sale by requesting a binding assessment notice from SKAT, and we can also handle your tax case for you, if necessary.