Tax benefits & depreciation
Tax advantages for property investments, with examples
Depreciation (AfA) is one of the strongest levers for property investors. The examples below show what is realistically possible, always subject to your personal tax situation.
Realistic scenarios for your investment
Whether new build, existing stock, QNG or heritage, I show you concrete depreciation examples and what they mean for your annual tax position.
New build (from 2023)
- 3% linear depreciation, or alternatively 5% declining-balance on the residual value.
- On a building share of EUR 300,000: EUR 9,000 annual depreciation.
- Around EUR 3,780 tax saving per year at a 42% marginal tax rate.
Existing stock (before 2023)
- Linear depreciation of 2% of the building costs.
- EUR 6,000 per year on a EUR 300,000 building share.
- Around EUR 2,520 tax saving per year.
QNG new build (sustainability seal)
- Declining-balance (5%) plus special depreciation under § 7b EStG, an additional 5% over 4 years.
- Up to 10% total depreciation in the first year, EUR 24,000 on a EUR 300,000 building share.
- Around EUR 10,080 tax saving per year over four years.
The cost cap for all new build forms is EUR 5,200 per square metre. Important: the QNG seal must be contractually secured in the purchase agreement. A building application by 31 December 2026 and first letting before 31 December 2026 are required.
Heritage-listed property
Heritage depreciation (§ 7i EStG) on EUR 300,000 of renovation costs: investors can deduct the full 100% of the state-recognised renovation share directly from taxable income over 12 years.
- Years 1 to 8 (9% p.a.): EUR 27,000 depreciation ≈ EUR 11,960 tax saving per year (total ≈ EUR 95,680).
- Years 9 to 12 (7% p.a.): EUR 21,000 depreciation ≈ EUR 9,300 tax saving per year (total ≈ EUR 37,200).
Over 12 years the investor recovers around EUR 132,880 through tax refunds, reducing net renovation costs to roughly EUR 167,120. Heritage authority requirements must be agreed contractually before construction begins.
These figures are illustrative examples and do not constitute tax advice. Your individual result depends on your personal circumstances.
Make the most of your tax advantages
Let's review which depreciation model fits your investment and personal tax situation.