According to the TMA 38 plan, construction developers enter into a transaction with apartment owners in buildings, according to which the tenants sell the additional building rights to the developer in exchange for strengthening the old building or demolishing and rebuilding it. In exchange for the additional building rights, it was also determined that the day of sale applies after the conditions precedent have been met in which the sale agreements were made and not on the day of signing, a determination that allows the payment of capital gains tax and purchase in respect of the transaction.
As the date for the temporary order expires, uncertainty has arisen regarding transactions signed before it expires, but the conditions precedent will only be met after it expires. To clarify the issue, the Tax Authority is now officially announcing that apartment owners and developers who contracted under the TMA 38 plan will be able to continue to enjoy the tax benefits that will expire on December 31, 2021 if the sale agreements are signed before the benefits expire, even if the conditions precede construction Only after the expiration of the temporary order.
The benefit is conditional on meeting a number of cumulative conditions: The transaction must be considered a transaction within the framework of TMA 38. The sale agreement was signed before December 31. The apartment owners complied with the obligation to notify and report set by law. December and all parties must meet all the conditions specified in the law.
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