Long renovation of the family home costs tax benefit

A renovation period of several years for an inherited family home will result in the loss of the tax exemption for an owner-occupied family home even if the property has special features.

The Münster Tax Court has confirmed the view of the tax authorities that a family home is not exempt from inheritance tax if the heir does not move into the property until after a three-year renovation phase. This is not changed by the particular factual situation in the dispute, in which the plaintiff's father occupied one semi-detached house until his death, while the son used the other semi-detached house. After his death, the son connected the two halves and carried out extensive renovation work.