When reselling your home, you can use the transfer tax ‘get back’. The rule is that only transfer tax must be paid on the capital gain of the property if the property gets a new owner within 6 months.
Please note that who is entitled to this ‘benefit’ must you agree in the purchase contract. In most cases, it is agreed that the benefit accrues to the seller.
What this looks like in practice is explained with the help of an example:
Jan will get his new home delivered at the notary on January 1. The purchase price was €250,000. So the transfer tax he pays is 2% of €250,000 = €5,000.
On May 31, Jan sold the house to Mr. and Ms. de Jong for €300,000. The key transfer is on June 29, so neat within 6 months. There is now only a need for the buyers to pay 2% to the tax authorities. transfer tax is to be paid on the capital gain of the property to know: €300,000 minus €250,000 = €50,000. However, this does mean that the buyers have a big advantage. They do not have to pay over €250,000. transfer tax to be paid.
But this benefit actually belongs to the seller. Therefore, it is usually agreed in a purchase contract that the buyers must repay this benefit to the seller. So the buyers pay the seller €5,000 and with this the seller has recovered his transfer tax paid in January of that year. Suppose Mr. and Mrs. de Jong separate and they resell the home at a loss for the purchase price of €275,000. The property will again be delivered to the notary within 6 months of them taking possession of it themselves. Then it applies that the buyer does not have to pay transfer tax to the tax authorities on the capital gain. Because there isn’t one. In fact, the property was sold at a loss. The buyer does have to pay the seller the benefit of the not-to-be-paid transfer tax on €275,000. That means he has to pay 2% on € 275,000 = € 5,500 to the seller.
If you paid 8% transfer tax because you are an investor/real estate investor, do you get the transfer tax back?
That depends on who you are selling it to. If you sell the property to another real estate investor, they must also pay 8% transfer tax and then you get your 8% transfer tax back in full.
But if you sell your property to a buyer who pays 2% transfer tax, you will only get back 2% of the 8% paid. So that means you will NOT get back 6% of the transfer tax you paid.
If the buyer pays no transfer tax at all (starter exemption), then you get ZERO transfer tax back.
Note: here too the rule applies that the property has changed hands within 6 months. So if you buy a property to renovate and sell it and the renovation takes longer than 6 months, you can completely blow the whistle on the transfer tax refund.