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Section 17 or capital income: which rule catches a sale of shares
The module’s worked examples, then cases to attempt before revealing their solution · 2 sections · 216 words · 3 min
Worked example
The diluted stake
Petra Sommer from the opening held 2 percent six years ago. The second capital increase, which pushed her below the threshold, took place four years ago. Until then her stake was at least 1 percent. That day lies within the last five years, so the sale falls under section 17 even though she now holds only 0.8 percent.
Practical case
Who falls under section 17?
Three shareholders sell shares in the same GmbH in October 2026. Anna has held a constant 0.9 percent for ten years. Bernd held exactly 1.5 percent until March 2020 and 0.6 percent since then. Three years ago Clara received 0.4 percent as a gift from her mother, who held 4 percent at the time. For whom does the gain fall under section 17 EStG?
Hint: For each of them, check the five years before the sale, and with shares acquired free of charge think of the predecessor.
Show the solution
Anna never reached 1 percent in the five years, so her gain is capital income. Bernd's last day at 1.5 percent was in March 2020, more than five years before October 2026; he too falls under section 20. Clara acquired free of charge, and her mother held 4 percent within the period: under section 17(1) sentence 4 the provision applies to her.
Answer: Only Clara
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