The agony of choice

You better quickly forget the answer from "Musketier" in connection with tax savings/provided services/BT, because it is not correct. As the end customer, you always pay the full VAT included;

Mistake, real estate transfer tax liable transactions are exempt from VAT.

we are all obliged to state "gross" amounts to you as a private customer.

No one disputes that either. Gross just means final amount and that is given to you by the developer. For the developer, net = gross.

Since the developer cannot reclaim VAT on services received and materials purchased from the tax office, the developer must include the gross amount (incl. VAT) as costs in his calculation. Naturally, he passes this on to the end customer. However, no VAT has to be paid on the developer’s actual profit and labor services.
You can safely trust a tax expert here. :)


To calculate this with an example:

External services from subs 100,000€ + 19,000€ VAT
Material 50,000€ + 9,500€ VAT
Services provided by own staff 50,000€
Profit 20,000€
Land value 100,000€


Calculation by the developer
External services 119,000€
Material 59,500€
Own labor services 50,000€
Profit 20,000€
House price 248,500€
+ Land 100,000€
Total price 348,500€


+ real estate transfer tax (5%) 17,425 €
=Total costs 365,925€



Calculation for GÜ/GU
External services 100,000€
+Material 50,000€
+Own labor services 50,000€
+Profit 20,000€
=Net amount 220,000€
+VAT 41,800€
=Price for end customer 261,800€

+ Land 100,000€
+ real estate transfer tax 5,000€
= 366,800€


The higher the real estate transfer tax (3.5-5%) and the more services are provided by subs, the more the GU/GÜ/architect variant pays off.

Hello,

You can definitely trust a tax expert sometimes. :)

Oops, sorry! That happens when I answer "on the fly"... :-( It should of course have said "you’d better forget it quickly, because it doesn’t change much for you. And that coming from me, a trained accounts receivable/accounts payable clerk :o

Because the following:

The higher the real estate transfer tax (3.5-5%) and the more services are provided by subcontractors, the more worthwhile the general contractor/general contractor with subcontractors/architect variant becomes.

is the crux of the matter ;)

Best regards

Hello everyone,

first of all, I would like to sincerely thank everyone who is participating in this discussion. Our decision is becoming clearer little by little...

Below are the answers to the questions posed to me:

Where is this new development area located?

It is in NRW (Lower Rhine)

A frequently played game - often interested parties can also purchase the plots directly from the respective municipality because it was not actually purchased by the BT at this point but merely reserved!

Unfortunately, the said plot was not named to us by RAG. And at the time of allocation, we did not get it either, even though it was on our wish list. Well, and now RAG has offered us some other plots for which the reservation fee presumably was not paid. And what we consider the nicest is the one described in variant 2.

What concerns were there and how were they resolved?

For example, the description stated that the AG is responsible for erecting the construction fences. Supposedly we could remove this from our list because this would be covered by the shell construction company. Another example is the downpipes.

What is required by the municipality as new planting? And how much of the linear meters is actually used by pedestrians?

It is a play street that leads to the remaining 12 plots and ends there with a turning hammer. So it probably won’t be that much.

the due real estate transfer tax is 5% on land and house for the BT
and on the other hand

The plot is sold by RAG and the BT acts as a "broker" in this case. Does the real estate transfer tax still apply to the house then? So far, this is how it had not been calculated for us!

Best regards
Teufelchen

Hello,

It is located in NRW (Lower Rhine)

In my area :-)

in the description it was, for example, written that the client is responsible for setting up the construction fences. Allegedly, we could remove this from our list because it would be covered by the shell construction company. Another example is the downpipes

Ultimately, after signing the contract, only the construction description (BB) counts, and here the rule is always: what is not stated in the BB is considered not purchased! That means, if the provider promised it to you, he must also fix it in writing, otherwise you will be out of luck.

the property is being sold by RAG and the BT acts as a "mediator" here. Does the real estate transfer tax still apply to the house? He hasn’t calculated it for us that way so far!

Then it is not a BT, but a so-called construction supervisor, and you can – sorry Musketeer, although you are of course right in the matter :-) – really forget his statements.

If the construction supervisor only "mediates" the property to you provided you build with him, 5% real estate transfer tax applies! Always!

Kind regards

I think it depends somewhat on the contract design. Does the land purchase contract state anything that you may only build with the construction company, or does the RAG pay brokerage fees? In that case, real estate transfer tax is definitely due.

If there is no legal relationship between RAG and the construction company and nothing about the construction company is mentioned in the land purchase contract, and a few weeks pass between the land purchase contract and the contract for work and services, then the tax office must first prove a real estate transfer tax obligation.

If there is no legal relationship between RAG and the construction company and nothing is mentioned about the construction company in the land purchase contract, and then a few weeks pass between the land purchase contract and the work contract, the tax office must first prove a real estate transfer tax liability.

They can do that. At least they will try vehemently. You are an expert, and tax offices vary. I can only speak for our local one. There, half a department is solely occupied with studying newspaper advertisements nationwide, identifying and archiving those that figuratively advertise "land and house" from a single source. They then verify these with incoming land purchases, and anyone who thinks they can dodge real estate transfer tax on the entire amount through a shady contract arrangement is in for a rough ride or will have to resort to legal remedies, because they stick to their position. Fortunately, that hasn’t happened to me because I carefully ensured separation, but it has happened to some neighbors in our building area. ;)