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BBG 2025 draft – impacts on real estate transfer tax

Authors: Elisabeth Bertl, Christoph Szep

The draft review version of the 2025 Budget Accompanying Act (BBG 2025) implements the closing of the loophole in real estate transfer tax for share deals, as announced in the government program, as of July 1st, 2025, as follows:

Change of shareholders within 7 years

Section 1 para. 2a of the Real Estate Transfer Tax Act (GrEStG), which previously only applied to partnerships, is being newly formulated in section 1 para. 3 (1) GrEStG and now includes changes in the shareholder structure of both partnerships and corporations, if at least 75% (previously 95%) of all shares in the company’s assets or in the company are directly transferred to new shareholders within seven years (previously five years). An exception applies to shares traded on the stock exchange.

Consolidation and transfer of shares

Section 1 para. 3 (2) GrEStG now regulates the real estate transfer tax liability for the direct or indirect consolidation or transfer of at least 75% (previously: 95%) of the shares in the company’s assets or in the company in the hands of a person or association of persons. Previously, it was stipulated that only a direct change in shareholding was relevant for real estate transfer tax purposes. This regulation is now also extended to indirect share transfers, whereby the percentage shareholdings at each level must be multiplied by one another. This means the definition of a consolidation can now also be met if it is not the shares in the property-owning company itself that are transferred, but the shares in a company higher up in the ownership chain.

Previously, the consolidation of shares in the hands of a group of companies also triggered real estate transfer tax. This no longer applies; instead of the group of companies, the association of persons is now redefined. An association of persons is deemed to exist if partnerships or corporations are combined for economic purposes under a single management or are under the controlling influence of one person, who may also be a natural person.

New regulation for real estate companies

The previously applicable preferential taxation for share deals (0.5% of the property value) no longer applies to companies whose primary activity is the sale, rental or management of real estate (“real estate companies”). Instead, the tax is to be set at 3.5% of the market value. This also applies to reorganizations. However, if all shareholders before and after the transaction belong to the family association within the meaning of section 26 para. 1 (1) GGG, the preferential taxation remains in place.

Conclusion

Transferring shares exempt from real estate transfer tax is becoming more difficult; the retention of a small share or an acquirer outside the group of companies or the insertion of an intermediate level no longer provide protection. In particular, share transfers in real estate companies will become more expensive. Potential real estate transfer tax consequences for minor changes in the shareholding must also be considered if a person holds 75% or more of the shares on June 30th, 2025, and share transfers are to take place in the future. Currently, only the draft law is available; its final enactment into law remains to be seen. Therefore, already planned share transfers should, if possible, be implemented by the end of June. We are happy to advise you!

Disclaimer

This article is for general information only and does not replace legal advice. Haslinger / Nagele Rechtsanwälte GmbH assumes no liability for the content and correctness of this article.