Your own property plays an important role in most industries, as it serves as an office or storage space. However, it is rarely expedient, especially in the corporate group, to acquire and hold the operating property in the operating assets. Entrepreneurs should rather position an independent rental company as a sister GmbH under their holding company and lease the property from this to the operating company. In this way, a differential tax rate can be used, since rental companies usually have to pay only 15 % corporation tax and no business tax.

1st base case: Operational real estate in operating corporate assets

If a company grows without immediate tax optimization, the commercial property is often "acquired" directly into the operating assets. It then constitutes the necessary operating assets of the respective business – for example, the sole proprietorship or a limited company (R 4.2, paragraph 1, EStR). There, the office, shipping or storage premises are to be activated with the acquisition or production costs (§ 6 (1) number 1 EStG).

With these acquisition or production costs, the object is now in the books of the operating company. It can write it off at 3 % per year (Section 7(4), first sentence, no. 1 EStG) and to this extent reduce its profit, but pays 30 % corporate and business tax on its final income.

Without a separate rental company, it remains with a full taxation of all profits with 30%. If the entrepreneur decides to set up a separate real estate GmbH, he could rent the property to his operating company. Since the profits of the real estate company are only charged with 15 % corporation tax, a tax rate difference can be exploited in this way. Nevertheless, it remains at a depreciation of 3 % per year.

Setting up and structuring the rental company

A rental company is usually part of a group of companies consisting, for example, of a holding company on the one hand and an operating company on the other. The rental company will now be positioned as a sister company alongside the operating company.

2.1. Step 1: Establishment of the rental company

The rental company is a regular GmbH or UG (other corporations are also conceivable). It shall pursue the purpose of acquiring, managing, repairing, hiring out and, where appropriate, disposing of real estate. The shareholder of the rental company is regularly the joint holding company, but foundations or private individuals are also eligible as shareholders.

The sole purpose of the rental company is the administration of own real estate within the meaning of § 9 no. 1 sentence 2 further the following GewStG. This gives the company the so-called extended reduction under trade tax law, which in the end – if no (harmful) ancillary activities are carried out – amounts to a complete exemption from trade tax.

2.2 Step 2: Acquisition and rental of operational properties

Now the rental company acquires the properties required for the operating company or has them built. The same applies to parking spaces and other outdoor facilities that fall under the concept of real estate.

The rental company may only manage the property itself. Operating equipment and other equipment, such as machinery and computers, must be purchased and operated by the operating company itself. Alternatively, the rental company also transfers these assets, but must bear in mind that the income from this transfer can amount to a maximum of 5% of the income from the management of the real estate. Even if the 5% threshold is not met, the extended reduction for the co-lease of other assets is excluded (§ 9 no. 1 sentence 3 letter c and sentence 4 GewStG).

If all conditions are met, the rental company concludes corresponding lease agreements for the real estate. While the rental income at operational level leads to a tax saving of 30 %, the rental company is subject to a taxation of only 15 % corporation tax. The resulting tax rate differential can be used optimally by agreeing on so-called sales rentals. The amount of the annual rent depends on the turnover of the operating company.

By the way: In addition to the commercial rental, the rental company can also purchase apartments and apartment blocks, which it then rents to private individuals. Here too, however, the principles on harmful ancillary activities that may jeopardise the extended reduction apply.

3rd transfer of real estate to the rental company

If there is currently a structure without a rental company and if such a structure is to be created, it is necessary to first transfer the real estate in operating assets to the rental company. There are basically three possibilities for this: