Real estate, whether rented commercially or for residential purposes, are usually depreciated according to the percentages in § 7 (4) sentence 1 EStG. The annual depreciation is a maximum of 3 %, but for most residential buildings a rate of 2 % applies per year. This results in a depreciation period between 33 and 50 years – and this is where sentence 2 of the aforementioned provision comes into play. With a real estate report, the depreciation can be accelerated if the actual period of use is less than 33 or 50 years. By letter dated 22.02.2023, the Federal Ministry of Finance (BMF) has set new standards here.
1st basis: How real estate is tax depreciation
The depreciation provisions of § 7 (1) EStG apply in principle to fixed assets. Corresponding articles are to be depreciated linearly on the basis of their usual period of use. For a machine that costs EUR 1,000 and is expected to be used for five years, the taxpayer sets EUR 200.00 as depreciation per year. This also applies under § 9 (1) sentence 3 number 7 EStG to surplus income, for example those from renting and leasing.
However, other principles apply to real estate. Because here the legislator specifies the annual percentage with which a depreciation is allowed. Of the acquisition or production costs of a building according to § 7 (4) sentence 1 EStG
This article does not replace tax or legal advice in an individual case. Facts, current law, jurisdiction, documentation and implementation remain decisive.