Certificate of exemption
The term certificate of exemption is used in different contexts.
Mortgage lending
An exemption certificate is the binding declaration by the financing bank of a property developer that it will release the contract object of a sale by the property developer to his client from all mortgages . Such a certificate of exemption is a prerequisite for the property developer to receive assets from the client in accordance with Section 3 Paragraph 1 No. 3 of the Real Estate Agents and Builders Ordinance (MaBV). This prohibition serves to protect the client.
If a developer z. B. an apartment building , his bank z. B. secure by means of a global land charge that extends to the entire property. The sale of each (to be built) homes to the end user, this results in the problem that the mortgage , which the acquirer for its mortgage lending enters, is entered in the place behind the global charge of the developer.
The purchaser must pay the proportionate purchase price according to the progress of construction according to a plan, the stages of which are fixed in favor of the client in accordance with Section 3 (2) MaBV. However, the acquirer's bank has no valuable security due to the priority global land charge. Therefore, these partial payments are only made if a declaration of exemption from the builder's bank ensures that the builder's bank agrees to release the apartment from the global land charge after full payment.
Income tax
In tax law , the tax office issues certificates of exemption , which exempt the recipient of construction work from the obligation to deduct construction withholding tax , Section 48b (1) sentence 1 EStG .
If someone (a supplier) renders a construction work in Germany to an entrepreneur within the meaning of Section 2 of the Sales Tax Act or to a legal entity under public law (a service recipient ), the service recipient is obliged to deduct a tax of 15 percent to be withheld (building deduction tax) and to be paid to the tax office responsible for the service provider . At the request of the service provider, the tax office must issue a certificate of exemption if certain requirements are met. The service provider hands over this certificate to the recipient of the service, who is thus exempted from the tax deduction obligation described.
Contract law
In contract law, one party to the contract exempts the other side from liability for infringements by third parties by means of certificates of exemption .