Do I have to pay taxes as the owner of a vacation rental?
October 18, 2022 | 40,00 EUR | answered by Tina Ullmann
Dear tax advisor,
My name is Björn Weinert and I recently purchased a vacation apartment on the Baltic Sea. I use the apartment for my own holidays, but also rent it out to vacation guests to cover the costs. Now I am wondering if I, as the owner of a vacation apartment, also have to pay taxes.
I am unsure because I have no experience with the taxation of properties so far. However, I want to be on the safe side and not commit any tax offenses. That's why I am turning to you to seek clarification.
My concern is that I may have to pay back taxes if I have done something wrong. I would like to know what taxes I could be facing and how I can prepare for them. Are there ways to save taxes or specific regulations to consider?
I would be very grateful if you could help me with this matter. Perhaps we could arrange a consultation appointment to clarify all open questions. I look forward to your assistance and thank you in advance for your help.
Sincerely,
Björn Weinert
Dear Mr. Weinert,
Thank you for your inquiry regarding the taxation of your holiday apartment at the Baltic Sea. It is understandable that you may feel unsure about the tax aspects, as property taxation can be a complex issue. I am happy to assist you in answering your questions and helping you prepare for potential tax payments.
As the owner of a holiday apartment, you are generally subject to taxation and must pay income tax on the rental income you earn from renting out the apartment. This rental income must be declared in your income tax return. Additionally, you can claim expenses such as repairs, maintenance costs, management fees, or depreciation to reduce your tax burden.
In addition to income tax, you may also be required to pay the so-called trade tax if you rent out the holiday apartment for commercial purposes. This is the case if you regularly rent out the holiday apartment with the intention of making a profit.
To save on taxes, you can consider various options. For example, you can optimize your expenses to reduce your tax burden. You can also check if you can benefit from the small business regulation, which allows you not to pay value-added tax on rental income if your annual turnover is below a certain threshold.
We can schedule a meeting for a detailed consultation to address all your questions and discuss potential tax-saving opportunities. It is important that you understand all the tax aspects of your holiday apartment to avoid potential tax payments and fulfill your tax obligations correctly.
I look forward to assisting you in clarifying your tax matters and am available for any further questions.
Best regards,
Tina Ullmann
Tax advisor
