No advertising cost deductions for property with housing rights, decides the Federal Finance Court

No advertising cost deductions for property with housing rights, decides the Federal Finance Court

No costs in advance for property due to housing rights

If you have a property, you cannot claim advertising costs if the property is still burdened with a right of housing and the rights holder does not agree to a rental. This has decided the highest financial jurisdiction in Germany, reports the information service law and taxes of the LBS. (Bundesfinanzhof, file number IX B 27/22)

The background: A real estate buyer wanted to claim costs for a planned rental in advance. However, the tax office rejected the application, since the later letting was not foreseeable in the case of an object burdened with an object of housing (in this case by the owner's father).

The judgment: The Federal Finance Court found that the tax court rightly rejected the recognition of the advertising costs. The owner of the lifelong housing right must agree to the lifelong housing right before renting individual rooms and, if necessary, waive parts of his right.

This judgment illustrates the importance of housing rights in the tax assessment of real estate. It shows that the planned renting of an object is not possible under certain circumstances as long as the right of housing exists.

property owners should therefore check carefully whether the property is burdened with a right of housing and whether the rights holder agrees to rent. Otherwise no advertising costs can be claimed.

The Federal Finance Court's judgment has an impact on the tax assessment of real estate and should be observed by real estate owners and potential buyers. It illustrates the importance of obtaining all relevant information in good time and taking potential restrictions into account when renting.

real estate law and tax issues should always be discussed with an expert in order to avoid nasty surprises and to find the best possible solution for everyone involved.