ᐅ Is it common to buy land and pay part of the price in cash?
Created on: 14 Feb 2018 12:53
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Vanyleon87
Hello,
I’m not sure if this is the right place, but we need some help. Here’s the situation: we found a piece of land privately where we want to build. However, the owner wants to do it so that only part of the amount is stated in the official purchase contract, and we would pay the rest in cash. (She mentioned maybe in an envelope in the notary’s waiting room, so she doesn’t have to pay tax on the full amount.)
We are very uncertain and find it strange that she wants to handle it this way. What do you think about that? We’re not sure if this could be considered tax evasion, which of course is completely unacceptable!
Thank you very much for your help.
I’m not sure if this is the right place, but we need some help. Here’s the situation: we found a piece of land privately where we want to build. However, the owner wants to do it so that only part of the amount is stated in the official purchase contract, and we would pay the rest in cash. (She mentioned maybe in an envelope in the notary’s waiting room, so she doesn’t have to pay tax on the full amount.)
We are very uncertain and find it strange that she wants to handle it this way. What do you think about that? We’re not sure if this could be considered tax evasion, which of course is completely unacceptable!
Thank you very much for your help.
B
Bieber081515 Feb 2018 12:59Nordlys schrieb:
Despite that, it is simply done hundreds of times that way. How do you know that for certain? And doesn’t an official have a special obligation not to just look the other way?
There is, to put it mildly, a noticeable discrepancy between the prices that notaries report to the appraisal committees of the districts—which then feed into the geodata values—and the usual market prices. Okay?
It feels like this discrepancy grew when the government raised the real estate transfer tax to 6.5%.
It could also be a coincidence. Or deception. Who knows.
Karsten
It feels like this discrepancy grew when the government raised the real estate transfer tax to 6.5%.
It could also be a coincidence. Or deception. Who knows.
Karsten
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chand198615 Feb 2018 15:2177.willo schrieb:
Honestly, I find it disgusting how a high-ranking official paid with tax money justifies tax evasion here [...]Well. According to their own statement, they describe rather than justify it. However, I had read it differently, see above. It is unfortunate to present such topics "just like that" without any context. Especially after the previous discussion.
My surprise actually began much earlier, when some openly considered the idea of taking the crook down (with identical collateral damage for the general public, but hey, who cares?) as if it might be an enjoyable experience – to show the fraudster by using an even smarter fraud.
That is why I found a subsequent description of an alleged practice of organized fraud very ambiguous, precisely because of the purely descriptive tone. Between the lines, a justification comes through, namely that of customary law.
One question remains unanswered: If "people" supposedly know about this, why is nothing done about it?
Nordlys schrieb:
There is, to put it mildly, a certain discrepancy between the prices notaries report to the appraisal committees of the districts—which then flow into the geodata values—and the usual market prices, ok?What does that imply?
Nordlys schrieb:
It seems this discrepancy grew especially where the state set the real estate transfer tax to 6.5%.And so what? Mentioning something like that almost in passing opens the door to speculation. Do you accept it? Do you think it’s good? Do you think it’s bad but inevitable? Bad and changeable? Is the government to blame when it passes a law that people don’t want to comply with?
P.S.: Your statement that only by excessively restricting freedoms can organized fraud be countered certainly sounds like a justification, even if that was not your intention.
The question is what the government can realistically do about it. Personally, I also find the real estate transfer tax quite unreasonable and difficult to justify with common sense. However, it is the law, and of course, I have paid it in full.
From my own experience and that of friends, I have heard that many try to reduce it somewhat (for example, deducting kitchens and furnishings at 20 years old with their original price, etc.). In my experience, notaries are quite relaxed about this, as long as the buyers and sellers agree. How is the government supposed to track and prove manipulation of around €15,000 to €20,000 (€17,000 to €22,000) just to later claim an additional €800 (€880) in real estate transfer tax? The cost of pursuing such a case would be higher, even though it is obviously not legal.
From my own experience and that of friends, I have heard that many try to reduce it somewhat (for example, deducting kitchens and furnishings at 20 years old with their original price, etc.). In my experience, notaries are quite relaxed about this, as long as the buyers and sellers agree. How is the government supposed to track and prove manipulation of around €15,000 to €20,000 (€17,000 to €22,000) just to later claim an additional €800 (€880) in real estate transfer tax? The cost of pursuing such a case would be higher, even though it is obviously not legal.