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INTERNATIONAL TAX
CJEU on Real Estate Transfer Tax
The Court of Justice of the European Union (CJEU) has ruled that real estate transfer tax on certain contributions in kind of shares in land‑owning companies may breach EU law.
In a judgment issued in June 2026, the CJEU decided that the levy of Portuguese real estate transfer tax on the contribution in kind of shares in land‑owning companies into a capital company may, under certain conditions, contravene the Capital Accumulation Directive (KA‑RL). As the Austrian Real Estate Transfer Tax Act (GrEStG) contains provisions comparable to Portuguese law, the Federal Ministry of Finance (BMF) has published an information note on the matter.
Implications for Austrian GrESt
In the view of the BMF, it can be assumed that the following transactions, which trigger an acquisition event (shareholder change or share consolidation) in the acquiring capital company, are to be classified as restructurings, provided that shares of the acquiring capital company are granted in each case:
Timely and comprehensive tax advice
Where a transaction falls under the CJEU case law clearly as a “restructuring” within the scope of the KA‑RL, tax offices are to assume that no real estate transfer tax liability arises. If the above criteria are unequivocally met, a self‑assessment or tax return for the transaction may therefore be omitted. However, as the legal position for other transactions and corporate forms not listed above has not yet been sufficiently clarified, real estate transfer tax should continue to be paid in those cases, and timely and comprehensive tax advice is recommended.
Implications for Austrian GrESt
In the view of the BMF, it can be assumed that the following transactions, which trigger an acquisition event (shareholder change or share consolidation) in the acquiring capital company, are to be classified as restructurings, provided that shares of the acquiring capital company are granted in each case:
- simple contribution of a capital share in a land‑owning company outside the restructuring tax act.
- (Down‑stream and Side‑stream) contribution or split of a capital share in a land‑owning company or of a (partial) business with a capital share in a land‑owning company.
- (Side‑stream) merger in which the assets of the transferring company include a capital share in a land‑owning company.
- corresponding “diagonal” transactions (e.g. contribution/split of a capital share in a land‑owning company within a group between different participation strands at different levels such as aunt/niece companies).
Timely and comprehensive tax advice
Where a transaction falls under the CJEU case law clearly as a “restructuring” within the scope of the KA‑RL, tax offices are to assume that no real estate transfer tax liability arises. If the above criteria are unequivocally met, a self‑assessment or tax return for the transaction may therefore be omitted. However, as the legal position for other transactions and corporate forms not listed above has not yet been sufficiently clarified, real estate transfer tax should continue to be paid in those cases, and timely and comprehensive tax advice is recommended.