Is renting worth it?
November 5, 2010 | 25,00 EUR | answered by Dipl.BW/SB Ulrich Stiller
Rental
Key Data:
Loan: 1 loan of 170,000,-, second loan of 26,000, of which 11,000 was transferred to a building society account as savings.
Land cost for pure purchase: 45,000,-
What production costs are set? A value x as with property taxes or proof of costs with invoice. The house was mostly self-built. Costs with invoice approximately 120,000,-
Production costs by company approximately 230,000-260,000,-
Total living space 191 m²
Ground floor 73.88 and 14.92 office 14.92 total 88.8
Attic 1 73.49
Attic 2 28.97
Generally in WFL unit
Rental to tenants (65% of the local rent, optional only attic 1 or both attics if cheaper)
Owner only woman
Loans only woman
Woman's gross income approx. 2,236,-
Woman's net income approx. 1,513,-
A house for own use was already claimed 20 years ago.
Questions:
Is renting financially worthwhile and if so, how much with depreciation?
What can I still claim as an owner?
Can the husband, although not the owner and not the loanee, also claim something tax-wise?
What forms, what do I have to declare where and in what amount?
Depending on a qualified answer, more information can gladly be provided.
Dear Seeker,
Thank you for your inquiry, which I would like to answer based on your information and in the context of your commitment in the framework of an initial consultation as follows:
Production costs are the costs that arise for the construction of the house. These costs are subject to depreciation, in your case the €120,000 plus the €230,000-260,000. If the total production costs amount to, for example, €350,000, this is the basis for depreciation. You must prove the amount of production costs to the tax office with invoices and contract documents.
If you rent the property to your parents 65% (partially), you must demonstrate to the tax office a total surplus within the next 30 years of the rental property, which may be difficult for you to achieve. In this case, you can only deduct 65% of the advertising costs. To achieve the full deduction of advertising costs, you should rent at least 75% of the local rent to your parents.
If you use the office for your own professional purposes, there may be necessary business assets, which can lead to tax disadvantages when selling.
Through the joint assessment of spouses, even the spouse who is not the owner of the property has tax advantages.
For owner-occupied residential property, you cannot claim advertising costs to the extent that they relate to the owner-occupied residential property. For owner-occupied residential property, you can only deduct 20% of the eligible expenses within the framework of craftsman services, but no more than €1,200 per calendar year on your income tax debt. Details can be found in § 35a EStG.
I hope that I could give you a first insight into the problem considering your commitment. You should seek detailed advice here, as your questions can only be answered conclusively after knowing all circumstances.
Best regards,
Ulrich Stiller
Tax advisor/Dipl. business economist
