Claiming caretaker service and winter maintenance against tax — what landlords should know

One point that often gets overlooked when deciding on a caretaker service: for landlords the costs are as a general rule tax-deductible — and so reduce the effective burden considerably more than many people expect.

Income-related expenses (Werbungskosten) on rental income

If you let out a property, you can deduct expenses connected with that property from your rental income as income-related expenses, known in German tax law as Werbungskosten (§ 9 in conjunction with § 21 Einkommensteuergesetz — the German Income Tax Act). These typically include the costs of a caretaker service, stairwell cleaning, winter maintenance and grounds maintenance — they directly reduce the taxable income from letting and leasing.

What about operating costs that can be passed on to tenants?

Many of these services count as operating costs which, under the Betriebskostenverordnung (BetrKV — the German Operating Costs Ordinance), may be passed on to the tenants: building cleaning and garden maintenance are named expressly in § 2 Nr. 9 and Nr. 10 BetrKV, street cleaning costs (which by common practice also cover winter maintenance) in Nr. 8. This always requires that the apportionment has been agreed in the tenancy agreement. Where it has, the landlord's income-related expenses are matched by corresponding income from the service charge statement, so for the portion passed on the effect is neutral for tax purposes. Even so, it is worth stating the costs correctly, because:

• where a property stands empty, nothing can be passed on to tenants — the full costs then remain deductible,
• portions that cannot be passed on (administrative shares, for example, or small repairs carried out as part of the caretaker service) can still be claimed as income-related expenses.

Commercial property and companies

If the owner of the property is a company (a GmbH, for example) or the property is used commercially, the costs of a caretaker service, cleaning and winter maintenance are normally fully deductible as business expenses (§ 4 Abs. 4 EStG) — without some of the restrictions that have to be observed with private rental income.

For a binding assessment of your own situation we recommend talking to your tax adviser — and we are happy to provide a clearly itemised invoice showing every relevant entry for that purpose.

How Zamsa helps

Which jobs arise in the first place — and therefore become relevant for tax — depends on the scope of the work. You will find an overview of what our caretaker service covers on the service page.