The purchase and sale of real estate in the country lead to tax obligations related to declaration, payment of taxes, deregistration from the tax service after sale, etc. Questions arise not only for domestic individuals, but also for foreign ones.
When buying real estate, a tax is also payable for its acquisition, in an amount determined by the local administration, according to the location of the property. Here they respect the rules for local taxes and fees.
Questions often arises are what the tax consequences are, whether tax is due on the income from the sale of real estate, regardless of whether the person is local or foreign.
The answers for individuals are at the Law for taxes of incomes of physical persons.
If it is an amount for 1 real estate that is residential and 3 years have passed since its acquisition, then the income from its sale is tax-free. For up to two immovable properties, the law requires a 5-year period, so that the income from their sale shall be not taxed. For agricultural and forest properties, regardless of their number, 5 years should also have passed.
However, it should be taken into account the special hypothesis of real estate acquired by inheritance and will, the income from the sale of which is also tax-free. And in this line of thought, it should be mentioned that donated immovable properties are excluded from this rule and their realized sale will be subject to taxation.
Apart from the exceptions, in other cases, income from the sale of real estate is subject to declaration and taxation. This happens with the submission of the Annual tax declaration and payment of the amount for the calculated tax due by April 30 of the year following the year of sale. There is a special calculation mechanism that should be followed.
In cases of Spousal Property Community, each of the spouses should file an Annual tax declaration for their taxable income.
This article is informative and does not constitute legal advice on a specific case. The information is valid to 31-03-2023.
