What tax obligations do I have as the landlord of a rental unit?
November 15, 2022 | 40,00 EUR | answered by Lorenzo Hartmann
Dear tax consultant,
my name is Anneliese Freudenberger and I have been renting out a granny flat in my house for several years. So far, I have always prepared my tax return independently, but I am unsure about the exact tax obligations I have as the landlord of a granny flat.
I have been renting out the granny flat since the beginning and I generate regular income from the rental. I have always declared the rental income in my tax return, but I am not sure if I need to provide additional information or if there are specific tax regulations that I need to consider.
I am worried that I may have overlooked tax obligations or made mistakes in my tax return that could result in tax consequences. I want to ensure that I fulfill all tax obligations as the landlord of a granny flat and avoid any issues with the tax authorities.
Could you please specify the tax obligations I have as the landlord of a granny flat? Are there specific attachments or forms that I need to fill out? What documents do I need to collect and keep in order to fulfill my tax obligations as a landlord?
I thank you in advance for your help and advice.
Sincerely,
Anneliese Freudenberger
Dear Ms. Freudenberger,
Thank you for your inquiry regarding your tax obligations as the landlord of a granny flat. It is important to be aware of these obligations in order to avoid potential tax consequences. I will now explain in detail the tax aspects that you need to consider as the landlord of a granny flat.
As a landlord, you are required to declare the rental income from the granny flat in your tax return. These income fall under the category of income from renting and leasing and are subject to income tax. Therefore, you must specify the amount of rental income as well as any deductible expenses such as maintenance costs, administration costs, or depreciation in Annex V of your tax return.
Additionally, you should check whether you are liable for value-added tax (VAT). If you rent out multiple apartments and your turnover exceeds the threshold of 17,500 euros per year, you are subject to VAT. In this case, you must declare VAT on your rental income and remit it to the tax office. It is important to correctly specify the VAT in your VAT return.
Furthermore, as a landlord, you should collect and keep all relevant documents. These include rental agreements, receipts for deductible expenses, statements of operating costs, as well as receipts for maintenance and modernization costs. These documents serve as evidence for your tax declarations and should be kept for at least seven years.
To ensure that you fulfill all your tax obligations as a landlord and avoid mistakes in your tax return, I recommend seeking advice from a tax advisor. A tax advisor can help you fill out your tax return correctly, identify tax optimization opportunities, and minimize potential tax risks.
I hope that this information has been helpful to you. If you have any further questions or require individual advice, I am at your disposal.
Yours sincerely,
Lorenzo Hartmann
