House Buying Tax

10 posts in this topic

Hi all, I need some help.
Myself and my wife are trying to buy a house from my wife's grandfather. He is trying to do us a favour by selling us the house for a cheaper price than the original price while letting us do rent-to-buy meaning we pay him directly on a monthly basis helping us avoid taking mortgage.
As the house is rented out now right now by my wife's grandfather, we plan on leaving the people living there in for now till we are ready for having kids and we will need the place for ourselves.
From my understanding, we were told by a notar that this would be regarded as a gift so we have to pay gift tax on this.
Is there anyway to avoid paying a huge gift tax on this kind of house  as we are trying to buy which means it is not completely a gift? Any info would be appreciated.

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You should go to a Steuerberater and speak to them, tax avoidence is no small matter and if you are going to do it make sure you do it right and legally water tight. 

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On 1.8.2020, 12:33:40, DaringD said:

You should go to a Steuerberater and speak to them, tax avoidence is no small matter and if you are going to do it make sure you do it right and legally water tight. 

 

Tax avoidance is perfectly OK, tax evasion definitely not. Pay for advice from someone who can explain the difference. 

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1 hour ago, silty1 said:

 

Tax avoidance is perfectly OK, tax evasion definitely not. Pay for advice from someone who can explain the difference. 

 

Is that not what I just said? 

 

No one was talking about tax evasion, OP asked a clear question about how to avoid paying tax, I have given OP the best advice I can on the subject they asked about which was to seek out a tax advisor, a Steuerberater, to make sure avoiding paying tax is done correctly and legally water tight.

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Since the OP hasn't been back since posting the question in 2018, he's probably not interested in any answers.

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You're probably correct, but firstly I hadn't noticed the date when I saw the topic, secondly I felt Silty1's reply insinuated I had mixed up normal financial conduct with criminal activity. No one mentioned tax evasion and there was no real need to bring it up. OP asked specifically about avoiding tax. 

 

But hey, perhaps showboating your one-upmanship is what wins you reputation points around here. 

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Nevertheless, it is an interesting subject. It's hardly rent to buy though. It sounds like the wife's grandfather is getting the rent twice every month. Nice. Is he declaring both amounts as income?! :) 

And what about when it comes to finally transferring the property - can the monthly amounts already paid be deducted from the sale price without making it so low that it arouses suspicions? :unsure: The arrangement may ultimately complicate things or defeat the object. 

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18 hours ago, DaringD said:

You're probably correct, but firstly I hadn't noticed the date when I saw the topic, secondly I felt Silty1's reply insinuated I had mixed up normal financial conduct with criminal activity. No one mentioned tax evasion and there was no real need to bring it up. OP asked specifically about avoiding tax. 

 

But hey, perhaps showboating your one-upmanship is what wins you reputation points around here. 

 

DD, no one-upmanship was meant, actually, I didn't intend to put too fine a point on it.  You made it clear enough in your reply. 

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I'm sorry that is the impression I took at the time. I have no reason not to take you at your word and apologize for my reaction. 

 

D

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