If a new (part of a) building is created as a result of a transformation of a building, 21% VAT is due on the sale and delivery of this building and the acquisition is in principle exempt from transfer tax. If no new (part of a) building is created as a result of the transformation, then no VAT is due on the delivery of the (part of a) building and the acquisition is in principle – in some cases the ‘start-up exemption’ can be invoked – taxed with 2% (home that is permanently used by the acquirer as main residence) or 8% transfer tax. For the question whether a new (part of a) building has been created as a result of a transformation, it is decisive according to case law whether this is essentially a new building.
Source: btwinstituut.nl
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