In 2023, there will be changes in the taxes for purchase a house, called transfer tax.
We have further highlighted these changes for you in this article.
1. Increase general transfer tax rate
In recent years, homes have been sold more often to investors instead of buyers who want to live in the property themselves. To better protect the last group, the general transfer tax rate will be increased from 8% to 10.4% as of 1 January 2023. The general rate applies to the purchase of non-residential properties and houses by legal entities and private individuals who will not live in the property themselves on a long-term basis.
These are mainly houses that are purchased to be rented out.
2. Transfer tax rate remains the same for purchase of a home to live in yourself
A buyer who is going to live in the house himself pays 2% transfer tax on the purchase price of the house.
This 2% may be dispensed with if you can use the starter exemptions.
3. Increase home value limit under starter’s exemption
First-time buyers can benefit from the exemption in transfer tax when purchasing a property under certain conditions.
The exemption applies if the following conditions are met:
– The purchaser is an adult natural person under 35 years of age
If you buy with your partner and only one of the two is younger than 35, you will pay 1% instead of 2% transfer tax.
– The purchaser has not previously applied the exemption
– The purchaser is going to use the property other than temporarily as their main residence.
– The value of the property does not exceed € 440,000. Here 2 things are important:
1) To determine the value of the home, the value of the home including the value of the leasehold is assumed. How much the value of the leasehold is worth should be calculated by a notary. This means that if you purchased a property for €440,000 and the property has leasehold then it is certain that you will not fall under the exemption!
2) The appraisal report will play an important role.If the market value is higher than your purchase price including any value of the leasehold then this valuation will be used to assess whether you qualify for the exemption.
If you are going to purchase a house it is wisely to first do a check on the amount of transfer tax.
This way you will not get surprised of the amount you must pay in 2023.