Some specific real estate transactions and their tax treatment

Specific tax ground rules apply to certain real estate transactions. In this article, we take a closer look at them.

1. Exchange

The exchange of two or more properties is a special legal figure. After all, legally it involves a double transfer.

In principle, an exchange is also considered for tax purposes as two sales: each party transfers one property and acquires another in its place. Without a correction mechanism, this would lead to the levy of selling rights on both transfers, each time on the value of the property acquired. However, in order to avoid this excessive tax burden, the regulations provide that the sales tax is levied only on the value of the property giving rise to the imposition of the highest duty.

Specifically, this means that in an exchange between two properties only one sales charge due is. The lower duty is ‘neutralized’ fiscally, so to speak. When the goods have an equal value, the sales tax is of course calculated on that common value.

Please note that this arrangement is only applicable if both real estate properties are sold under registration duties (right of sale). If one of the properties to be exchanged is a new building concerns, on which btw applies, this regime will not apply. In this case, both VAT (on the new property) and sales duty (on the existing property) will be due.

2. Purchase of a mixed-use property

Anyone who buys a home that is (partially) a professional function has (such as a commercial property, practice space or mixed-use building) often wonders which sales law applies.

The qualification of the property as home after all, has important implications for the applicable sales law and the application of the reduced rate of 2% in connection with the purchase of the sole, owned home.

2.1. When is a property primarily a dwelling?

An immovable property is considered a dwelling for purposes of sales law when it is primarily intended is for habitation. This is the case when any occupational or other non-residential function is only ancillary or subordinate is to the living area.

Typical examples are a house in which one room is rented out, a house with a small practice room, or a house with a separate garage that is considered an annex. In such situations, provided the other conditions are met, the reduced tariff in sales law are applied to the entire property. Price splitting is not an issue in that case.

It is different when the non-residential function is structural and equivalent to the residential function. This can be the case when the professional part and the residential part are in terms of area, value or use intensity about the same, as in the case of a commercial property with residential above it. In that situation, the property is not primarily zoned for habitation and is not automatically treated as a residence.

2.2. Can a mixed-use property be subdivided?

When living and working coexist and neither function is subordinate, the property may, under certain conditions fiscally disaggregated be. That means the residential portion can be taxed separately at the reduced rate and the professional portion at the regular rate.

Such a split is possible only if:

• the residential and professional part as distinct parts can be delineated,
• both parts legally independent can be considered,
• and in the purchase deed a clear pricing is included between the two parts.

Are these conditions not met? Then the entire property is taxed at the ordinary rate (i.e. 12%).

2.3. Not only current, but also future use matters

In assessing the applicable rate, the tax authorities look not only at the current condition of the property, but also at the destination which the buyer wants to give to it after the purchase. A property used entirely as a commercial business today may still qualify as a residence if the buyer will use the property for residential purposes and that change is possible with only normal maintenance or repair work.

Conversely, a property that is a pure residence when purchased, but will be used entirely for a professional activity, does not qualify for the reduced rate. After all, in that case, the obligation of effective occupancy and registration at the address cannot be met.

If the property will be used for both residential and professional purposes after purchase, it will be reconsidered for which function predominates. If habitation is the main use, then the reduced rate can be kept, possibly for the whole or the residential part, depending on the specific situation.

3. Renewal of a right of superficies or usufruct.

When private individuals and corporations invest together in real estate, temporary rights in rem such as the usufruct Whether the right of superficies. The limited duration of these rights means that at some point the parties are faced with the question of whether an extension is appropriate.

This not only involves legal aspects a role, but are there also important tax considerations.

3.1. Usufruct

A commonly used structure in real estate practice is one in which private individuals the bare ownership acquire and their company the usufruct. This usufruct is established for a predetermined period, which in practice sometimes turns out to be too short. In that case, a extension impose themselves.

The impact in terms of registration fees of such an extension was disputed for a long time. The Flemish Tax Administration defended the position that an extension should be equated with the establishment of a new usufruct, resulting in the levying of the sale right of 12% in the Flemish Region.

However, the Supreme Court, in its judgment of Jan. 24, 2025, definitively held that a conventional extension of an existing usufruct does not constitute a transfer or establishment of a usufruct, but only a modification of one of its modalities, specifically the duration. Consequently, in that case, only the general fixed fee of 50 euros payable, provided that the extension:

• takes place before the expiration of the original term of usufruct (otherwise, the sales charge of 12% is due), and
• relates to same right and same parties and thus nothing fundamental is changed about the other modalities of the agreement.

3.2. Right of superficies

In addition to a usufruct, the practice often involves a right of superficies, where one or more private persons own the land and the structures (yet to be erected) belong to the company. A right of superficies is also a temporary right, so that when the term expires, the question of its renewal arises. When a right of superficies expires and the parties decide to renew, this agreement will be subject to the law of 5%, calculated on the agreed-upon superannuation fee.

A crucial focus here is the timely nature of the extension. To be legally considered an extension, it must take place before the end of the originally agreed upon duration of the building lease right. After all, if this does not happen, the superficies extinguish.

If the superficies right expires without timely renewal, the structures erected by the superficies holder during the term of the superficies right shall automatically pass to the landowner, who then also becomes the owner of the buildings.

If the right of superficies is subsequently re-established, it is no longer an extension, but a renewal. Legally, this creates a completely new superficies right, separate from the original right. At that time, the pre-existing structures are in the full ownership of the landowner and must be transferred again to the surface owner.

This renewal therefore involves a significant tax risk in:

• The landowner should provide the partnership Compensate for the constructions, if not is potentially a benefit in kind due in personal income tax; and
• The buildings will be transferred back to the company, with the sales right of 12% owed on its value.

Additionally, it is also important here that there is a extension in which only the duration of the duty is adjusted and the other modalities remain unchanged.