Rental Income
Rental income is subject to income tax, with a 20% deduction from the gross rental amount allowed for income-generating expenses. Taxable rental income is calculated as the gross rental amount minus 20% of the total rental income.
Individual Capital Gains Tax
Capital gains from the disposal of immovable property acquired after January 1, 1980, are subject to a 20% tax. Taxable capital gains are calculated as the total selling price minus the acquisition cost and improvement costs.
However, individuals may deduct a lifetime exemption from capital gains, which is a one-time exemption opportunity granted to taxpayers. The deductible amount varies depending on the seller and the property.
1. An individual selling their private residence may deduct a lifetime exemption of €85,430, provided the owner has resided there for at least 5 years.
2. Farmers disposing of or selling agricultural land may deduct a lifetime exemption of €25,629.
3. Any other property disposal may deduct a lifetime exemption of €17,086.
The following disposals of immovable property are exempt from capital gains tax:
1. Property transferred due to death.
2. Gifts made between parents and children, between spouses, or between relatives up to the third degree of kinship.
Note: This information is sourced from the internet. For specific details regarding actual tax rates, please consult Worldway Immigration customer service.