German tenants can claim tax deductions on service charges

Tenants in Germany can reduce their income tax by utilizing service charge statements (Nebenkostenabrechnung). According to a ruling by the Federal Fiscal Court (Bundesfinanzhof) on April 20, 2023, costs such as stairwell cleaning, garden maintenance, and winter services can be deducted.

Specifically, 20 percent of recognized costs for household-related services can be deducted, up to a maximum of 4,000 euros per year. For craftsman services, the deduction is 20 percent of labor, travel, and machine costs, up to 1,200 euros annually. These amounts are deducted directly from the calculated income tax rather than just reducing taxable income.

To assist with navigating rental complexities, the Consumer Advice Center (Verbraucherzentrale) and the German Tenants' Association (Deutscher Mieterbund) have released the fifth updated edition of the ‘Mieter-Handbuch’. This guide helps tenants verify operating cost statements, which averaged 2.67 euros per square meter per month in 2024 due to rising energy prices, property taxes, and insurance costs. The handbook also covers topics such as rent increases, modernizations, and termination rights.