How does the tax deductibility of advertising costs work in rental situations?
February 28, 2024 | 55,00 EUR | answered by Lorenzo Hartmann
Dear tax advisor,
I am Maria Möller and have been successfully renting out a property for several years. This year, I would like to deduct the advertising costs for the first time, but I am a bit unsure of how exactly this works.
So far, I have only declared the rental income and deducted the usual operating expenses such as repairs or maintenance work. However, I have heard that other costs such as insurance, management fees, or acquisition costs for furnishings can also be claimed for tax purposes.
My concern is that I might make mistakes here and end up having problems with the tax office. Therefore, I would like to know from you which advertising costs are exactly tax deductible and how to correctly declare them in my tax return.
Could you please explain to me exactly how I can deduct the advertising costs when renting out my property and whether there are any special considerations to be aware of? I want to make sure that I take full advantage of all tax-deductible options and do not pay unnecessary taxes.
Thank you in advance for your help.
Sincerely,
Maria Möller
Dear Mrs. Möller,
Thank you for your inquiry regarding the tax deductibility of advertising costs in the rental of your property. It is understandable that you are unsure and do not want to make any mistakes to avoid problems with the tax office. I am happy to explain to you which advertising costs are exactly tax deductible and how you can correctly specify them in your tax return.
First of all, it is important to know that advertising costs are all costs that arise in connection with the rental of your property and serve to generate rental income. These include the operating costs you have already mentioned, such as repairs, maintenance work, property tax, insurance, administrative costs, etc. These can usually be easily claimed as advertising costs.
Also, acquisition costs for furnishings such as furniture, kitchen appliances, or renovation work can be deducted as advertising costs under certain conditions. It should be noted that these acquisition costs must be depreciated over the useful life, so they cannot be fully deducted in one year but must be spread over several years.
There are special rules, for example, when it comes to the depreciation of buildings, where you must distinguish between straight-line depreciation and special depreciation. There are also specific regulations to consider when renting to close relatives.
To ensure that you correctly specify and maximize all advertising costs, I recommend that you keep a detailed list of all incurred costs and carefully specify them in your tax return. It may also be useful to consult a tax advisor who can assist you in preparing your tax return and ensure that all tax options are maximized.
I hope that I could help you with this information. If you have any further questions or need assistance, I am happy to help.
Best regards,
Lorenzo Hartmann
