As part of a condominium association and owner of a condominium, you pay monthly maintenance fees to cover the common costs of your apartment complex. Often overlooked is the potential for tax savings, as certain components of maintenance fees are tax-deductible. This opens up the opportunity to reduce your financial burden and take advantage of tax benefits. However, caution is advised: Not every maintenance fee item is automatically deductible.
What is behind your house money?Link to this section
Each month, you transfer an amount to your property management company, known as the maintenance fee. This money is used to cover all costs associated with maintaining and managing your shared property. This includes, for example, repairs to the facade or stairwell, paying the property management, insurance for the building, and establishing reserves for major renovations.
These costs are not part of the house fee
NotHowever, the maintenance fee includes costs that the individual apartment owners must bear themselves. These include, for example, property taxes, telephone, internet, and television costs, home contents insurance, and all costs incurred for the maintenance, renovation, or modernization of their own apartment. Landlord liability insurance is also generally not included in the maintenance fee.
Overview: What is included in the house fee – and what is notLink to this section
Examples of costs that may be included in the maintenance fee:
Cleaning of common areasGarden careWaste disposaljanitorial servicesBuilding insuranceMaintenance reserveCommunal electricity and heatingElevator maintenanceMaintenance of basements, swimming pools and other common areas
Examples of costs not included in the maintenance fee:
property taxCosts for telephone, internet and televisionHome contents insuranceLandowner liability insuranceMaintenance, renovation and modernization of your own home
You can find a detailed explanation in our guide on the topic House fee .
Determining the house fee: An annual processLink to this section
Determining the amount of maintenance fees is a key task of the property management of your condominium association. This process takes place once a year at the owners' meeting and proceeds as follows:
Preparation and proposal
The property management prepares a business planThis budget serves as the basis for the assessment of the amount of the maintenance fee
Decision-making
The owners’ meeting meetsThe economic plan is presented and discussedA vote on the proposed amount of the house fee will take placeA simple majority of homeowners is sufficient for acceptance
Consequences and obligations
All owners must pay the agreed maintenance feeThis obligation applies regardless of the use of the property – whether you rent it out or live in it yourself
Possible adjustments
If the maintenance fee is set too low: additional payments may be requiredIf the maintenance fee is set too high: Refunds are possible
This process ensures that the maintenance fee is determined fairly and transparently, taking into account the financial needs of your condominium association.
This is how the maintenance fee is distributed among the ownersLink to this section
As a member of your homeowners associationYou're probably now wondering how much your share of the maintenance fee is. This is usually calculated proportionally based on the size of your co-ownership share. This means that the larger your share of the shared property, the higher your monthly payment will be. The exact distribution is governed by the declaration of division. However, individual agreements can be made for certain costs. For example, owners of a ground-floor condominium can be exempted from certain costs.
What do you need to know about the housing allowance statement? Read our blog article on the topic Housekeeping bill Find out everything important.
These components of the house fee are tax deductibleLink to this section
The entire maintenance fee is not tax-deductible. However, you can deduct some of the expenses included in the maintenance fee from your taxes under certain conditions. These include, in particular:
Household services:If your property management company hires companies to maintain communal green spaces, provide janitorial services, or clean stairwells, you can deduct a portion of these costs from your taxes. You can claim up to €4,000 annually for household-related services.Craftsmen’s services:If repairs or modernizations are being carried out on shared property, for example, to the facade or common areas, you can deduct 20 percent of the labor costs, up to a maximum of €1,200 per year.
Declare house money in your tax return – this is how you do itLink to this section
To claim the maintenance fee for tax purposes, you must enter it in Form V under rental income. If you own multiple rental properties, you must prepare a separate Form V for each property. Expenses may not be aggregated. Separately recording the income and expenses of each individual property makes it easier to understand.
Other costs that are tax deductible in addition to the maintenance feeLink to this section
In addition to maintenance fees, there are other expenses that can have a positive impact on your tax burden. It's important to distinguish whether you, as a homeowner, use your condominium yourself or rent it out.
Tax specifics for owner-occupied condominiums
If you own a condominium that you live in yourself, you primarily benefit from the fact that any services and tradesmen's work are tax deductible. This primarily includes the household-related services and tradesmen's work already explained. The most relevant labor costs are those incurred, for example, for maintaining your lawns, cleaning work, or repairs, such as hiring a chimney sweep. If you want to improve the energy efficiency of your property, you can claim the costs of an energy consultation as a tax deduction. This consultation is often a prerequisite for government subsidy programs.
An overview:
Craftsmen’s services:Yes, tax deductible, 20 percent of wage costs up to €1,200 per yearHousehold services:Yes, tax deductible, 20 percent of the costs, up to €4,000 per yearFees for chimney sweeps:Yes, tax deductible as part of household servicesEnergy consultant costs:Yes, tax deductible for energy-saving renovation measuresInsurance costs:Yes, tax deductible, e.g. building insurance and home contents insuranceRenovation and repair costs:Yes, tax-deductible, provided they contribute to maintenance and modernization. Major maintenance projects, such as a complete roof renovation, are generally not directly tax-deductible.Depreciation (AfA):Not tax deductibleInterest rates for real estate loans:Not tax deductibleAdditional costs and operating costs:Not tax deductibleTravel costs to the property:Not tax deductible
All items that can be deducted for tax purposes must be declared in Annex H of your income tax return.
Tax deduction: Additional options for landlords
For a rented condominium, the tax deductibility for maintenance fees is even more extensive. As a landlord, you can deduct the following expenses in addition to the items already mentioned:
Craftsmen’s services:Yes, tax-deductible, up to 20 percent of wage costs (max. €1,200 per year)Energy consultant costs:Yes, tax deductible as a business expenseAdditional costs and operating costs:Additional costs that you cannot pass on to the tenants of your condominium are generally tax deductible.Advertising expenses:This includes all expenses related to renting the condominium, such as interest on real estate loans, costs for repairs, maintenance measures and property management.Depreciation:Yes, it's tax-deductible. The acquisition cost of a property can be depreciated over a longer period. This is considered depreciation and reduces taxable profit.Travel costs:Yes, it's tax-deductible. If you regularly travel to the rented condominium, for example, to carry out repairs or to look after the tenants, you can claim the travel expenses as business expenses (a flat rate of 30 cents per km for self-employed management).Insurance costs:Yes, tax deductible, e.g. building insurance and home contents insuranceAgent fees and tenant search costs:The costs for finding tenants and the associated advertising can be claimed as tax deductions.Household services:No, it cannot be deducted from taxes, as these are usually passed on to the tenants
These items are recorded as business expenses in Annex V (Rental and Leasing Income). Please note that reserves for future maintenance only become tax-deductible when actually used.
Similarities for both forms of ownership
Regardless of whether you use your condominium yourself or rent it out to tenants, you can generally deduct the following costs from your taxes:
Insurance costs:Insurance costs are incurred for both owner-occupied and rented condominiums, for example for building insurance or liability insurance.
To take full advantage of all possible tax benefits, it is advisable to carefully retain all relevant documents. This includes invoices, receipts, and bank statements. For more complex matters, we recommend consulting a tax advisor.
Conclusion – tax-deductible house money brings advantagesLink to this section
As a homeowner, you have the advantage of being able to deduct a portion of your maintenance fees from your taxes. This applies particularly to costs incurred for household-related services, such as gardening, cleaning, or minor repairs.
You can especially benefit if you rent out your condominium. In this case, in addition to the services already mentioned, larger expenses for maintenance and modernization of the shared property can be deducted from your taxes. Even if you live in your apartment yourself, you can benefit from tax advantages. In this case, the costs of household-related services are particularly deductible. However, major maintenance measures are generally not directly tax deductible.
In conclusion, we can say that by correctly declaring your maintenance fee in your tax return, you may be able to achieve significant tax savings.
Do you already know Ralph?
Are you looking for a property management company that offers more than just managing your property and condominium association? With Ralph, you get not only professional property management but also comprehensive support with your maintenance costs.
We help you prepare your maintenance fee statement optimally and consider all tax-relevant aspects. Our expertise in real estate and taxes ensures that you take advantage of all possible tax benefits and avoid unnecessary payments. Rely on our experience and expertise. We prepare your maintenance fee statement transparently, accurately, and in accordance with the latest tax guidelines.
All important information about our services, extras and costs can be found on our information page Property management costs . Please contact us for a non-binding offer.
