What tax benefits do I have as a self-user of a condominium?
September 12, 2023 | 50,00 EUR | answered by Tina Ullmann
Dear tax advisor,
My name is Fanni Heck and I am recently the proud owner of a condominium which I inhabit myself. I have heard that there are tax benefits for owner-occupiers of real estate, but I am not quite sure what they are and if I am taking advantage of all possibilities.
Currently, I pay my mortgage interest and utilities for the apartment monthly, and I am wondering if I can deduct these expenses from my taxes. Furthermore, I have made investments to renovate and modernize the apartment. I am also wondering if and how I can deduct these costs from my taxes.
I am concerned that I may overlook or misinterpret tax benefits and therefore give away money that I could actually save. That is why I would like to know from you what specific tax benefits I can claim as an owner-occupier of a condominium. Are there specific regulations or provisions that I need to consider in order to optimize these benefits?
I would greatly appreciate it if you could provide me with a comprehensive overview of the tax benefits for owner-occupiers of real estate and show me possible solutions on how to best utilize these benefits for my situation.
Thank you in advance for your help.
Sincerely,
Fanni Heck
Dear Mrs. Heck,
Thank you for your inquiry regarding tax benefits for owner-occupiers of real estate. As a proud owner of a condominium, you indeed have the opportunity to deduct certain costs for tax purposes and take advantage of various tax benefits.
First of all, as an owner-occupier, you can deduct your mortgage interest for tax purposes. These costs can be claimed as operating expenses for rental and lease income. It is important to note that the tax deductibility of mortgage interest only applies to owner-occupied properties.
Additionally, the monthly ancillary costs you pay for your apartment can be claimed for tax purposes under certain conditions. These include costs for property management, waste disposal, property tax, insurance, and repairs. These are also considered operating expenses that can reduce your tax burden.
The investments you have made for the renovation and modernization of your apartment can also be deducted for tax purposes. These are considered maintenance expenses and are treated as operating expenses. You can either deduct the costs immediately in full or depreciate them over several years.
To fully utilize the tax benefits, it is important to carefully keep all relevant receipts and invoices and report them in your tax return. Also, make sure to clearly separate the costs to avoid misunderstandings with the tax authorities.
In addition to the mentioned tax benefits, there are other ways for owner-occupiers of real estate to save taxes. This includes considering household-related services or craftsman services in your tax return.
Overall, it is advisable to seek advice from an experienced tax advisor to optimize all tax benefits and avoid possible mistakes. A tax advisor can also help you optimize your tax situation and identify potential savings.
I hope that this information was helpful to you and I am available for any further questions. I wish you success in utilizing the tax benefits for owner-occupiers of real estate.
Best regards,
Tina Ullmann
