1. What is a real estate donation?

In the case of a real estate donation the property owner transfers his property or land to third parties free of chargeThis is the case when an owner, for example, gives away his property to his children. In this context, a notary accompanies the process and the donee is registered in the land register. The donor receives a certain security by being informed by the Usufruct and also in the Land Register In addition, the Usufruct Save gift tax.

1.1. What is the right of usufruct?

The usufruct right in real estate includes the Lifelong right to live and use a propertyThis right is notarized and registered in the land register. In comparison to the right of residence, the usufructuary may also use economically and, for example, generate rental income.

The usufruct right can also be extended to several people, so that, for example, spouses or other house residents can benefit from the usufruct. As a rule the usufruct expires at the end of the life of the usufructuary. However, this right can also be used for a limited period of time or removed from the land register by mutual consent.

2. What must the usufructuary take into account when installing a photovoltaic system?

The construction of the PV system must always be agreed with the owner. Basically, you need the permission of the owners, as this is it is a structural change.

When it comes to funding measures for PV systems, the requirements of the funding providers must be observed. In addition to low-cost subsidized loans in the KfW program 270, which you can apply for through your bank, the federal states offer their own funding offers. There may be other points to consider here, which you can find in the respective funding requirements.

3. When can it make sense to give away a property?

A property donation is advisable if the so-called usufruct is used. Only then does the Inheritance tax savings.

In addition, a real estate donation is advantageous if major renovation work can no longer be realized with a small pension. After the gift, the usufructuary is only obliged to pay for small repairs and the usual operating costs. Costly renovation work or the modernization The property will then be the responsibility of the recipient.

4. What risks arise when donating a property?

First and foremost, the gift of a property during one’s lifetime results in a high asset changes handsAlthough the capital is not available in liquid form but is invested in the property, a house or a condominium as an investment forms a worthwhile basis for security in old age.

By making a gift, the donor waives this capital investment. In return, the usufruct right is entered in the land register.

5. How can you save taxes by donating real estate?

Anyone considering donating their property can benefit from a reduction in gift tax. This is the case if a Usufruct in the land register was registered.

The Federal Court of Justice recognizes that the usufructuary does not want to give up the use of the property despite the donation. At the same time, the new owners no rental income achieve because the Property is occupied by the usufructuary. Consequently, the Value of the usufruct is deducted from the market value of the property.

The value of the usufruct corresponds to the Usage value per year and the Life expectancy of the usufructuaryThe latter is determined using statistics. It is therefore an average value. The following applies: The value of the usufruct decreases proportionally to the increasing age of the donor. In some circumstances, it is even possible for the gift tax to be completely waived due to the tax exemption.

5.1. What allowances apply to gift tax?

According to the Inheritance and Gift Tax Act, the Property value in the case of a real estate donation, Basis for calculating gift taxThe market value is determined at the time when the donee is registered as the owner in the land register.

At the same time, it is important to consider in which family relationship the giver stands by the recipient. As a result, a specific tax rate and a specific tax allowance used. The spouse benefits from a higher tax allowance than nieces or nephews.

6. Conclusion

In a property donation, the property owner transfers his house or condominium to another person. Since he is passing on the capital investment, he can Benefit from usufruct rightswhich must be entered in the land register. Through the usufruct right, the donor receives a lifelong right to live and use the property and the recipient benefits from the tax exemption. However, any structural changes such as the installation of a solar thermal or photovoltaic system must be discussed with the new owner and require their approval.