Real estate asset deal: What is it? + tax example

There are 2 types of sales when we are in the professional real estate business – i.e. not the condominium or the dream house. Typically, it is about apartment buildings or apartment buildings (rented apartment buildings). Asset deal means that a property is sold directly and share deal means that a real estate GmbH is sold (with its property/properties) – simply put. Here is a look at the typical asset deal and the taxes on the sale. Here you can find out more about the share and asset deal in comparison.

The typical sale: “asset deal”

The difference: In an asset deal in the real estate context, specific assets such as land and buildings are sold individually, whereas in a share deal the shares in the company that owns the real estate are transferred.

Simply put:

• Asset deal = property is sold
• Share deal = Immobilien GmbH is sold

A share deal means that the buyer does not acquire the property itself, but the – in this case – Immobilien GmbH. Here is a short infographic. Then back to the direct sale of the apartment building, after which I will explain more about the holding company and taxes on the sale.

Here is a small infographic:

Tax calculation: Example

If you sell within the speculation period, you must – simply put – pay tax on the profits as normal, just like income from work, regardless of whether you are employed or self-employed. As a single person, this would typically mean a top tax rate of 42%.

Asset deal as a private individual

In this example, we are selling an apartment building in Berlin, as a private individual, single person with full tax rate.

• Purchase 2024 = 2,100,000 euros
• Sale in 2033 = 4,100,000 euros
• Taxable profit = 2,000,000 euros
• At 42 % (single person) = 840,000 euros

Asset Deal as a company

In this example, we are selling an apartment building in Berlin, as a company, already with significant tax savings.

• Purchase 2024 = 2,100,000 euros
• Sale in 2033 = 4,100,000 euros
• Taxable profit Berlin approx. 19.1 % (trade tax 4.1 %, corporation tax 15 %) = EUR 2,000,000
• At 19.1 % = 382,000 euros

Share deal property: tax advantages

Saving taxes, but the right way? In my guide to selling a multi-family home for tax purposes, I have just given a short, simple explanation of the share deal, with an example calculation. Instead of 382,000 euros in taxes, only 1,540 euros! How does that work? Here is an insight into asset deals and share deals. You will quickly recognize the advantage and why professional investors work with holding structures.

• Share Deal Real Estate
• Asset / share deal difference