Optimal tax planning when selling your company respectively terminating your business activity – especially in the case of existing business premises and land

LBG Austria - Summary: In the context of the taxation of the sale of a business respectively the termination of a business the property gains tax of 30% on buildings and/or land and ground that are sold respectively transferred to private assets may be reduced to half of the average income tax rate (up to 27,5% when in the highest income tax rate of 55%) – however, certain requirements need to be met.

Requirements:

• the business for sale has existed for at least seven years
• the selling entrepreneur has completed its 60th year
• the selling entrepreneur quits its business activity or became incapacitated for work 

The use of the tax advantage in connection with the use of half the average income tax rate (also for land) is usually the cheapest tax variant when selling or abandonment of a business. Therefore, in the run-up to a company sale or business termination, a restructuring of a limited liability company into a sole proprietorship or partnership should be considered in order to ensure optimal taxation. In any case, we recommend a timely and forward-looking planning when thinking about selling your company respectively quitting your business activity.

Contact & Advice: This information naturally shows basic aspects of the topic - for completeness and correctness no guarantee can be given despite careful preparation. LBG will gladly advise you in your individual situation. Please contact one of our 31 Austria-wide locations (www.lbg.at) or welcome@lbg.at - we will gladly bring you together with one of our experts, who is very familiar with your request.