Starting from July 1, 2025, Austria will implement major changes in the tax regulation of real estate transactions, particularly regarding so-called “share deals” — the acquisition of shares in companies that own real estate. Lawmakers aim to close tax loopholes that previously allowed investors to avoid paying real estate transfer tax (Grunderwerbsteuer) by purchasing companies that owned the real estate rather than the real estate itself. (We previously discussed this loophole in one of our earlier articles.)
What Is a Share Deal in the Context of Taxation?
A share deal is a transaction in which the buyer gains control of a real estate asset indirectly — by purchasing shares (or all shares) in the company that owns the property. This method was often used in large commercial real estate deals, where properties changed hands without the formal transfer of title in the land register.
In such cases, the obligation to pay Grunderwerbsteuer (real estate transfer tax) was either avoided or significantly reduced. Under the previous rules, the tax obligation only arose when 95% or more of a company’s shares were transferred to a single entity.
What Changes in 2025?
According to Article 59 of the Budgetbegleitgesetz 2025, the following amendments to the Grunderwerbsteuergesetz (GGG) — Austria’s Real Estate Transfer Tax Act — will take effect on July 1, 2025:
1. Reduction of the Ownership Threshold:
The shareholding threshold that triggers the tax obligation is lowered from 95% to 75%. This applies to both partnerships (Personengesellschaften) and corporations (Kapitalgesellschaften).
2. New General Ownership Criterion:
If a single natural or legal person directly or indirectly acquires (or already holds) 75% or more of the shares in a company owning real estate, a tax liability arises. The tax rate is 3.5% of the fair market value (gemeiner Wert) of the real estate.
3. Indirect Changes in Ownership Structures:
Unlike the current rules that apply only to direct transfers of shares, the new law will also tax indirect changes in ownership at higher corporate structure levels. Shareholdings will be calculated by multiplying ownership percentages at each level of the corporate chain — known as the “Multiplikation der Beteiligungsquoten”.
Clarification: The new law will, for the first time, combine related parties (e.g., affiliated companies, controlled entities) to reach the 75% threshold.
4. Extension of the Monitoring Period for Share Changes:
For partnerships (Personengesellschaften) and corporations (Kapitalgesellschaften), the monitoring period for changes in shareholders increases from 5 to 7 years. If 75% or more of the shares are transferred to new shareholders within this period, a tax liability arises.
5. Higher Tax Rate and Base for Immobiliengesellschaften:
For companies primarily engaged in real estate management, sales, or leasing, the following applies:
- The Grunderwerbsteuer rate increases from 0.5% to 3.5%.
- The tax base is the gemeiner Wert — fair market value of the asset.
- Tax liability arises upon consolidation of shares, shareholder changes, or reorganizations affecting such companies.
Family Exception:
According to § 26a Abs. 1 Z 1 GGG, a reduced tax rate of 0.5% is maintained for the transfer of shares within close family relationships. This remains an exception to the general rule.
Comparative Table of Changes to the Real Estate Transfer Tax Act (GGG)
| No. | Regulatory Area | Before 01.07.2025 | As of 01.07.2025 | Comment |
| 1 | Ownership Threshold | 95% | 75% | Lower threshold for tax liability |
| 2 | Share Consolidation Tax Trigger | Only direct ownership >95% | Ownership ≥75%, incl. via indirect chains | Combined holdings through affiliates count |
| 3 | Company Types Affected | Only partnerships | Now includes partnerships and corporations | Unified legal approach |
| 4 | Shareholder Change Period | 5 years | 7 years | Extended monitoring window |
| 5 | Immobiliengesellschaft Tax | 0.5% on structural changes | 3.5% on fair market value | Significant tax burden increase |
| 6 | Definition of Immobiliengesellschaft | No specific definition | Main activity: leasing, sales, management | First formal categorization |
| 7 | Indirect Ownership | Not considered | Now included via ownership multiplication | Closer scrutiny of corporate structures |
| 8 | Family Transfer Exception (§ 26a Abs 1 Z 1 GGG) | 0.5% tax | 0.5% tax remains | No change to favorable family rule |
This table clearly shows that from July 1, 2025, Austria significantly broadens the taxation base for the transfer of shares in real estate-related companies and increases tax oversight over corporate structures.
Examples of the New Law in Action
- Example 1: In 2023, Company X acquired 94% of the shares in a GmbH that owned a shopping center valued at €12 million. The deal was not subject to Grunderwerbsteuer as the 95% threshold was not exceeded. In 2025, the same deal would result in a tax liability of €420,000.00 — even without any change in the land register.
- Example 2: Two companies within the same holding structure acquire 40% and 35% of the shares in a real estate-owning company. Although neither company holds a controlling stake individually, they collectively control 75%, triggering a tax obligation.
Practical Implications for Investors
- M&A Structures Must Change:
It is no longer possible to bypass Grunderwerbsteuer by splitting shares among several entities — affiliated companies are now aggregated for tax purposes. - Financial Planning Becomes More Complex:
Acquiring real estate through a GmbH “wrapper” no longer guarantees tax benefits. - Greater Market Transparency:
The new model enables authorities to better identify effective control changes over property assets.
Conclusion
The 2025 reforms are part of Austria’s broader strategy to combat tax avoidance and level the playing field for all market participants. Share deals will no longer be a tool to legally circumvent property transfer tax obligations. Investors and legal advisors must prepare for these changes by reassessing corporate structures, transaction models, and tax planning approaches to remain compliant and financially efficient in the evolving real estate landscape.
