Manipulation of the purchase price renders the purchase contract invalid

Purchase price manipulation – The higher the agreed purchase price of a property, the higher the real estate transfer tax. For this reason, it happens from time to time that contracting parties agree to state a lower purchase price in the purchase contract in order to keep the land transfer tax lower. The part of the purchase price not stated is then paid by the purchaser under the table. Since only the purchase price stated in the sale was notarised, but the total purchase price was higher, the purchase contract is invalid.

Purchase price manipulation at a glance: The increase in land transfer tax

• The higher the purchase price of a property, the higher the real estate transfer tax
• Some contracting parties decide to state a lower purchase price in the purchase contract in order to save real estate transfer tax.
• Purchaser pays the rest of the purchase price under the table
• Contract is invalid because the full purchase price was not notarised

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