New Regime On Austrian Real Estate Transfer Tax

As of 1 July 2025, any kind of direct or indirect share deal of companies owning real property will have to be scrutinized under the new Austrian Real Estate Transfer Tax (RETT) Regime. It shall no longer be possible to bypass RETT by share deal constructions. However, the amendment will have a significant impact on any kind of share deal, even in case the transfer of real estate will only be an indirect side-effect of the transfer of shares.

 

Background

Until now, the transfer of real estate triggered RETT in the amount of 3.5% of the purchase price in case of asset deals, whereas it was possible to circumvent RETT with a share deal. So far, the acquisition of shares in a company holding real estate, triggered RETT in the amount of 0.5% of the property value (Grundstückswert).

The regime on asset deals will remain as is, however, the share deal regime will change:

• Direct change in the shareholder structure

As of 1 July 2025, a change in the shareholder structure in such a way that at least 75% (previously 95%) of the shares in the company’s assets or the company are transferred directly to new shareholders within seven years (previously 5 years) will trigger RETT in the amount of 0.5% of the property value (in case of agricultural land or forestry, 0.5% of the unit value - Einheitswert) in case the company owns real property.

• Indirect shift in shareholder structure

Another major change concerns indirect shifts in ownership. Until now, only direct changes in shareholding were subject to taxation. Under the new framework, indirect transfers in ownership structures will also trigger tax obligations. Ownership stakes will be calculated by multiplying the percentage holdings at each level of the ownership chain.

Here are some examples to illustrate the new provisions:

• Example 1: B-GmbH holds a 50% stake in A-GmbH, which owns real estate. C-GmbH, which holds a 70% stake in B-GmbH, transfers all of its shares in B-GmbH to D-GmbH. The transfer of shares from C-GmbH to D-GmbH results in a 35% (70% of 50%) shift in the shareholding in A-GmbH. A share consolidation is therefore not achieved, neither directly nor indirectly.

• Example 2: B-GmbH holds an 80% stake in A-GmbH, which owns real estate. C-GmbH, which holds a 95% stake in B-GmbH, transfers all of its shares in B-GmbH to D-GmbH. The transfer of shares from C-GmbH to D-GmbH results in a 76% (95% of 80%) shift in the shareholding in A-GmbH. This results in a taxable indirect share consolidation at D-GmbH with regard to the real estate of A-GmbH. If B-GmbH also owned real estate, this would also result in a direct share consolidation by D-GmbH.

An exception in case of indirect shifts will be made for listed publicly traded companies.

 

Real estate companies

The new regime further introduces the definition of “real estate company” (Immobiliengesellschaft). These are companies primarily engaged in property sales, rental, or management. Share consolidations (Anteilsvereinigungen und -übertragungen), changement of shareholders (Gesellschafterwechsel), and restructurings (Umgründungsvorgänge) of real estate companies will trigger 3.5% of the fair market value (gemeiner Wert).

Transfers within family structures will continue to benefit from a reduced rate of 0.5% of the property value. Note that this reduced rate will not apply in case a non-family member is part of the family structure.

 

Entry into force

The amendments are primarily intended to come into force on July 1, 2025, and apply to acquisitions for which the tax liability arises or would arise after June 30, 2025.