A rented house is to be transferred within the family. Instead of a cash payment, the next generation takes over an existing bank loan. In conversation the undertaking is nevertheless called a “gift”. For financing and tax planning this label must not obscure the actual consideration.
Describe the transaction completely before signing
Note the acquisition date, costs at that time, previous use, current valuation and the exact obligations envisaged. It must be clarified separately whether and how the assumption of the bank liability is actually effected. A mere private wish is not a confirmed change of debtor.
In its judgment of 11.03.2025, IX R 17/24, the BFH dealt with the partly remunerated transfer of a privately held plot of land. For the profit determination there the allocation is made according to the ratio of the consideration to the market value. This also applies where the consideration is below the historical total acquisition costs. [UEBERTRAGUNG] Therefore “Less was paid than back then” is not sufficient for a tax audit.
The proportional calculation in the example
We invent a market value of 360.000 euros, a debt assumption classified as consideration of 120.000 euros and prior acquisition costs of 270.000 euros. The remunerated portion is one third. Numerically, 90.000 euros of the prior acquisition costs are attributable to this portion. Compared with 120.000 euros consideration, a difference of 30.000 euros arises before further necessary adjustments.
The calculation exclusively shows the allocation principle. It does not determine any personal tax. Depreciation, further costs, all prerequisites and possible exemptions are not calculated here. Nor is it claimed that every intra-family transfer is taxable.
The transferor may need their own funds
With an assumption of debt no freely disposable money flows to the former owner in the model assumed. A possible income tax charge could nevertheless trigger a separate liquidity issue. Please therefore explicitly ask the tax adviser for classification of the actual transaction before committing, including its temporal and usage-related prerequisites.
In addition, gift tax, the administration and financing of the assuming person are dealt with as separate questions. None of these is resolved by this simple proportional calculation.
Replace the old comparison with a complete one
For a sound decision the correct consideration, pro rata cost basis and professionally checked tax consequences belong together. The starting point is the concrete draft contract with all assumed obligations. The case is not intended to favour any transfer variant. It merely prevents a consideration in the form of debt from remaining invisible in the monetary and tax plan.