Field help: (2022) Type of depreciation

Select here whether you want to carry out depreciation using the straight-line method in accordance with sect. 7, para. 4 of the Income Tax Act (EStG) or using the declining-balance method in accordance with sect. 7, para. 5 of the Income Tax Act (EStG).

Basically, the acquisition costs can be deducted as income-related expenses by way of depreciation if you rent out the property. However, depreciation is only possible on the building portion, but not on the land portion. Therefore, the total purchase price must be divided between the building and the land.

The purchase price allocation can either be determined by the buyer and seller in the purchase contract, or the buyer must carry out the allocation in his/her first tax return after the acquisition. The Federal Ministry of Finance (Bundesministerium für Finanzdienstleistungsaufsicht, BMF) regularly provides a working guide to either make or check a purchase price allocation in a typified procedure.

Enter only the actual depreciation amount for the year 2022. If necessary, reduce your full depreciation by the amount of land not used to generate income!

Example: The depreciation for the entire building in the assessment year is 2022 totalling 1.200 Euro. The house consists of two flats, one of which is used with 200 sqm and one of which is rented with 100 sqm. In this case, you can only claim 1/3 as depreciation, that is a total of 400 Euro.