The term “mandatory contract” is of importance in tax law, especially in the acquisition of assets. Because it depends, among other things, when the ownership of the respective object passes to the acquirer. In the case of real estate transfer tax, the tax liability arises with the mandatory contract, while in income tax law sometimes other principles apply.
Civil basis: The contract as an agreement between two parties
The foundations of contractual relationships are regulated in § 311 (1) BGB. Accordingly, a contract consists in the agreement of two persons on the establishment or substantive change of a contract. As a rule, the contract is a mutual obligation. Both parties are therefore obliged to perform a service, in the case of the purchase contract for example to hand over the purchased object and to pay the agreed purchase price.
Contracting parties generally conclude contracts voluntarily. Actions that force one of the two parties to sign usually result in the ineffectiveness of the entire agreement. Such a case is, for example, where the consent of a Party has been brought about by threat or extortion.
While the same principles initially apply to all contracts, the BGB knows several types of contracts with partially more extensive provisions in the respective standards. The main contracts are:
This article does not replace tax or legal advice in an individual case. Facts, current law, jurisdiction, documentation and implementation remain decisive.