Financial law questions on the transfer and utilisation of real estate

Author:Éva Erdos, Zoltán Varga
Position:Associate Professor, PhD, Head of the Financial Law Department, Institute of Public Law, Faculty of Law, University of Miskolc/Associate Professor, PhD, Financial Law Department, Institute of Public Law, Faculty of Law, University of Miskolc
Pages:51-67
SUMMARY

In our article we analyze the transfer and utilization of real estate from a financial point of view. After the introduction we clarify the main elements of the theme. We overview the basic concepts of the following acts: personal income tax, act on duties, and on local taxes. Then we focus on the tax aspects of the transfer of real estate, especially on the definition of real estate and property ... (see full summary)

 
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LESIJ NO. XXVI, VOL. 1/2019
FINANCIAL LAW QUESTIONS ON THE TRANSFER AND UTILISATION OF
REAL ESTATE
Éva ERDS*
Zoltán VARGA**
Abstract
In our article we analyze the transfer and utilization of real estate from a financial point of view.
After the introduction we clarify the main elements of the theme. We overview the basic concepts of the
following acts: personal income tax, act on duties, and on local taxes. Then we focus on the tax aspects
of the transfer of real estate, especially on the definition of real esta te and property rights in the Act on
Persona l Income Tax and to the deter mination of the income and profit from rea l estate transfer from
the perspective o f persona l income tax, on the basis of per sonal income tax a nd on the ta x rate. We
examine the ta x reliefs a nd exemptions for rea l estate tr ansfers, historica lly, and under the effective
law. In the second part of the article we deal with some issues of the real estate transfer from the aspect
of duties, with the duty to be pa id in case of the free transfer of the pr operty and its a ntecedents.
Secondly with the regulations of duties related to pr operties in case of onerous transfer of estates. The
third main pa rt is the tax la w of short and long-term housing (Airbnb), the ta xation of apa rtment and
house rentals a nd finally taxation of short time apartment and holiday resor t rentals.
Keywords: taxation, real estate, a partment, market value, short and long time housing (airbnb).
1. Introduction
We can approach the examinatio n of
financial legislation on real estate taxation
from several sides, and there are many
possibilities for regulation in financial law.
The subject has b een of eternal significance
since the introduction of the Personal
Income Tax Act of 1988, as we sell, rent,
buy, lease and etc., land, property,
apartments, and to these, different taxation
and tax payment rules are to be applied.
We can examine the definition of t he
property, provisions on the transfer of
immovable property, the provisions of
income tax related to the sale of rea l estate,
* Associate Professor, PhD, Head of the Financial Law Department, Institute of Public Law, Faculty of Law,
University of Miskolc (e-mail: jogerdos@uni-miskolc.hu).
** Associate Professor, PhD, Financial Law Department, Institute of Public Law, Faculty of Law, University of
Miskolc (e-mail: civdrvz@uni-miskolc.hu).
the tax pro visions related to the immovable
property acquisition and the tax regulations
related to real estate utilization. When
renting a property, it is important whether
the activity is ca rried out as a business
activity or not, and new oppor tunities have
also emerged in housi ng utilization, suc h as
the RBNB - short-term apartment renting,
which is currently at its peak. This is due to
the digital revolution, the spread of on -line
programs at light speed, and the
development of tourism.
The property can be a land, but also an
apartment, a holiday home, a farm, or a
garage, which may also have different
regulations. It is also important that an
52 Lex ET Scientia International Journal
LESIJ NO. XXVI, VOL. 1/2019
individual or a legal entity is the seller or the
user. T hus, it can be seen that the financial
issues of taxation of real estate provide
numerous opportunities for investigating
and exploring problems.
Property regulation is always at the
center of interest nowadays - when it comes
to the recovery and revival of the real estate
market - it is very timely to review the key
points of the regulations.
In this paper we summarize the tax and
levy rules related to the transfer of property.
2. Cla rification of concept s: Rea l
estate, apartment, property rights,
definition of the land
In the financial legal provisions, we
can find the definition of property in several
places, on one hand, Act CXVII of 1995 on
Personal Income Tax1. (Hereinafter referred
to as "Szja tv.") And on the other hand in the
Act O n Duties (Act XCIII of 1990)2.
(Hereinafter: Itv.)
The definition of the Personal Income
Tax Act.:
'Real property' shall mean any parcel
of land and all other constituent parts of the
land, excluding all standing (not harvested)
crops o r produce sold without changing
owners of the real property (e.g. standing
trees).
Arable land3 shall mean the landed
areas used for agricultural and forestry
purposes as de fined in the Act on
1 Act on Personal Income Tax Chapter III. Section 3, Concepts and interpretative provisions, point 29.
2 Act XCIII. of 1990.
3 Act on Personal Income Tax Chapter III. Section 3, Concepts and interpretative provisions, point 51.
4 Act CXXII of 2013 on Transactions in Agricultural and Forestry Land.
5 Act CXXII of 2013 on Transactions in Agricultural and Forestry Land Paragraph 5 point 25.
6Act CXXII of 2013 on Transactions in Agricultural and Forestry Land Paragraph 5 point 3.
7 Act on Personal Income Tax, Chapter III., Concepts and Interpretative provisions, point 31.
8 Act on Personal Income Tax, Chapter III., Concepts and Interpretative provisions, point 73
9 Act on Personal Income Tax, Chapter III., Concepts and Interpretative provisions, point 73
Transactions in Agricultural and Forestry
Land4.
Farmstead5 shall mean a parcel of
land located outside the limits of the
settlement, not exceeding o ne hectare in
size, consisting - apart fro m the land - of a
residential and farm building or buildings for
crop and animal production, and the related
processing a nd stor age o f agricultural
products, or any parce l of land registered in
the real estate register as a farmstead;
‘Estate’6 shall mean all lands of the
right-holder, whether under the title of
ownership, usufruct or any other legitimate
form of use;
Rights in immovables7 shall mean
incorporeal rights in property, such as
dominant tenement, leasehold, usufruct, use,
easement and lease rights.
Residential suite8 shall mean a
constructed structure registered, or in the
process of being registered in the real estate
register as a detached house or a r esidential
suite, furthermore, a structure under
construction shown a s a detached house in
the building permit if the walls and the roof
structure are completed, furthermore, any
rural house standing o n a parcel shown as a
homestead in the real estate register.
Residential lot9 shall mean a building
plot defined as such in the Act on the
Formation and Protection of the B uilt
Environment, i f the land is zoned for
residential building in the respective
structural plan and/or in the local zoning
ordinance, also the parcel of land that is

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