Can inheritance tax also be paid retrospectively?
March 18, 2022 | 50,00 EUR | answered by Wilhelm Ackermann
Dear tax advisor,
My name is Emma Höhne and I have a question regarding inheritance tax. Several years ago, I inherited a piece of land from my parents. At that time, I was not yet of legal age and my parents covered the inheritance tax for me. Now that I have come of age, I have learned that the value of the land has significantly increased.
My concern now is that I may have to pay the inheritance tax retroactively, as the tax office now considers the current value of the land. I am worried about how much the tax repayment could be and if I can even afford it.
Is there a way to pay the inheritance tax retroactively and how much would the costs be? Are there alternative solutions to potentially avoid or reduce tax repayments? What should I consider in this situation and what steps are now necessary to get my tax affairs in order?
Thank you in advance for your support and advice.
Best regards,
Emma Höhne
Dear Mrs. Höhne,
Thank you for your question regarding inheritance tax. It is understandable that you are concerned about whether you may have to pay inheritance tax retroactively and how high it could be. I will be happy to provide you with all the information on this matter and suggest alternative solutions.
Firstly, let me reassure you: generally, you do not have to pay inheritance tax retroactively if the value of the inherited property has increased. Inheritance tax is assessed in the year in which you inherit the estate. If your parents paid the inheritance tax for you when you were still a minor, you should check if the tax was properly paid. A supplementary payment may be necessary if the value of the property has significantly increased.
To calculate the amount of any potential tax repayment, you should have the current value of the property determined. This can be done by a real estate appraiser or an expert. Based on this value, the amount of the tax repayment can then be calculated. The exact amount depends on various factors such as the current value of the property, the tax rate, and possible allowances.
There are also ways to avoid or reduce tax repayments. One option could be transferring the property to you as the heir during your lifetime. This could help avoid possible tax repayments. However, it is important to seek comprehensive tax advice before taking such steps to avoid tax pitfalls.
In this situation, it is advisable to consult a tax advisor to get your tax affairs in order. A tax advisor can help you minimize potential tax repayments and suggest alternative solutions. It would be best to schedule a consultation to discuss your individual situation and take concrete steps.
I hope this information is helpful to you and I am available for any further questions.
Best regards,
Wilhelm Ackermann
