Tax relief for buildings in redevelopment areas and urban development areas Unfortunately this specification of service has not yet been completely translated.
In order to specifically support the rehabilitation (in particular) of city centres, public funding in the form of grants from rehabilitation or development funds is granted on request. In addition to this direct support, the preservation of buildings in redevelopment areas and urban development areas is also favoured for tax purposes. In order to benefit from the tax advantages, you need a special tax certificate, which must be presented to the tax office. You will receive this certificate upon request from your competent municipal authority. The certificate shall be issued by the municipal authority only for buildings which are Remediation area or urban development area which are carried out in which construction work is carried out, which modernization or repair (i.e. S. d. Section 177 of the Building Code) or the preservation, renewal and functional use of a building which is to be preserved because of its historical, artistic or urban significance and which the owner shall be able to carry out in addition to certain modernisation measures towards the municipality. The form in which you benefit from the tax break depends on the use of the building and the type of effort: a. Use to generate income Manufacturing effort If you earn income (e.g. business, freelance, rental, and leasing) with the building, you can claim increased depreciation in your income tax return. In the first 8 years you can deduct up to 9 percent of the production expenses for tax purposes, depending on the type of income, (Section 7h Income Tax Act). Maintenance effort There is a right to vote for maintenance expenses (Section 11a of the Income Tax Act). You can reduce the maintenance spread evenly over 2 - 5 years or in the year of payment or origin. b. Use for own residential purposes Manufacturing effort If you use the eligible building not for income, but for your own residential purposes, you can deduct the expenses on your own building as special expenses and in the year of completion of the construction work and in the following 9 years each up to 9 percent of the expenses in the income tax return (Section 10f (1) Income Tax Act). Maintenance effort Maintenance expenses can be deducted over 10 years, up to 9 percent per year as special expenses (Section 10f(2) of the Income Tax Act). Note: Acquisition costs attributable to corresponding construction measures may be taken into account insofar as they are incurred after the conclusion of a purchase contract (renovation measures in the context of purchaser models); however, the purchase price attributable to the existing building is not favoured. Similarly, the construction of a new building is not favoured. Please note: Where public aid has been granted, these shall be offset against the beneficiary expenditure.
The income tax return shall be attached to the original tax certificate by the competent municipal authority.
- § 7h Einkommensteuergesetz (Erhöhte Absetzungen bei Gebäuden in Sanierungsgebieten und städtebaulichen Entwicklungsbereichen)
- § 10f Einkommensteuergesetz (Steuerbegünstigung für zu eigenen Wohnzwecken genutzte Baudenkmale und Gebäude in Sanierungsgebieten und städtebaulichen Entwicklungsbereichen)
- § 11a Einkommensteuergesetz (Sonderbehandlung von Erhaltungsaufwand bei Gebäuden in Sanierungsgebieten und städtebaulichen Entwicklungsbereichen)
The tax support for buildings in redevelopment areas and urban development areas is granted within the framework of the assessment for income tax. The increased deposition can be taken into account for the first time in the assessment period during which the beneficiary construction project is completed as a whole. In the case of a multi-year construction project, the completion of the entire project is therefore crucial. Note: Employees can have the tax advantage for buildings used for their own residential purposes in redevelopment areas and urban development areas taken into account in advance as an allowance in the payroll tax deduction procedure.