Dear Real-Estate Friends,
An uncertainty that had arisen at the hand of the state in relation to latent retrospective taxation of deferred capital gains has taken a buyer-friendly turn for all purchasers in the Canton of Zurich thanks to a ruling issued by the Federal Court of Justice. If the property subject to deferred capital gains had hitherto been deemed to be collateral, then, in the event that the replacement property was again sold within a period of three years, that is an end to the matter: Henceforward, the replacement property will serve as collateral in respect of any latent taxation outstanding on both properties. At this point we refer to the latest circular issued by the Cantonal Finance Department. The change in practice applies with immediate effect – although the situation remains unclear for liens and charges that have already been assigned or for bank guarantees that may remain in effect for up to three years on the basis of existing contractual arrangements.

With my best regards from the real estate sector,
Claude Ginesta

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