Upon sale of assets, the gains derived from the transfer of assets shall be taxable in the period of taxation (in a calendar year) when money from the sales transaction is received. In case of swaps, the gains are created in the period of taxation when a corresponding entry is made in the land register.
Income from transfer of property is declared on the income tax return (form A) which must be submitted to the Tax and Customs Board not later than by 31 March of the year following the receipt of income. If you submit an electronic income tax return, you will find part of the information filled in.
If a seller of the property receives the payment during several years, then upon calculation of income of different periods the acquisition cost and expenses directly related with the sale are taken into account according to the proportion of money received in a particular year.
A registered immovable which was bought two years ago at the purchase price of 6400 euros will be sold at the price of 25 600 euros and the sales price will be received in two parts: 6400 euros will be received this year and 19 200 euros next year, or, out of the sales price this year 25% and next year 75% will be received. When considering the proportional acquisition cost, this year 25% or 1600 euros of the purchase price and next year 75% or 4800 euros will be taken into account.
If a taxpayer wishes, the acquisition cost and expenses directly related to the sale may be taken into account in the range of an amount received in the period of taxation, i.e. gains will be subject to taxation when the income received would exceed the acquisition cost and the expenses related to the transfer.
As a rule, income from intermediation of immovable property is declared and taxed as business income. If the intermediation of immovable property is a person's business activity, then income received should be declared on the income tax return on business income (form E). A sole proprietor entered in the commercial register may deduct the business related expenses from his or her income. Both income tax and social tax are payable on business income.
If the intermediation of immovable property is not an activity with elements of business, then the received income should be declared on form A of the income tax return. Income tax is charged on such income (social tax is not payable in this case).
Income received from the transfer or intermediation of advance reservations of immovable may be taxable as business income (to be declared on form E), or as gains received from transfer of property (to be declared on form A), or as other income (to be declared on form A).