DeutschTaxes: Inheriting or giving away will become more expensive in 2023
Published on: , by
No, inheritance taxes are not to be increased - contrary to some rumours. Nevertheless, the tax burden on the transfer of real estate could increase. As part of the Annual Tax Act 2022, the Valuation Act is to be amended. This could also increase the inheritance tax on real estate.
New legislative needs have arisen in some areas of tax law. For example, it is necessary to introduce adjustments to EU law and ECJ case law as well as reactions to the case law of the Federal Constitutional Court and the Federal Fiscal Court into the legislation. The Annual Tax Act 2022 serves this purpose.
The Inheritance Tax and Gift Tax Act (ErbStG) itself is not touched. However, due to a ruling of the Federal Constitutional Court, the legislator must ensure the taxation of real property at the actual market value. The Annual Tax Act 2022 therefore contains, among other things, planned amendments to the Valuation Act (BewG). This forms the basis for the valuation of real estate for inheritance and gift tax purposes. As a result of the planned amendments, the new valuation may lead to a higher tax burden on the gratuitous transfer of real estate from 2023 onwards.
According to the previous valuation procedures, lower market values for real estate were regularly determined. The draft law provides for an adjustment of the valuation procedure so that the actual market value can be determined more precisely. In this way, the further increasing property prices are to be better taken into account in the tax valuation.
Critics complain that the Ministry of Finance wants to implement a hidden tax increase in this way. Should the draft come into force as planned, the regulations for the new valuation procedure will apply from 01.01.2023. Land that is transferred free of charge could be subject to significantly higher values for tax purposes from then on. It is advisable to check in good time whether transfers already planned are affected by the change in the law.
(Photo: © Razor Max, Pixabay)