Secondary apartment – tax declaration – monthly income tax?

Hello dear home builder,

I am very confused and hope that some of you can help me with your experience and knowledge to get some clarity. We have found a plot of land and are currently planning a house with a basement granny flat with a general contractor. The granny flat is intended for my mother, who will long-term no longer be able to cope on her own due to old age.

I understand that we have to sign a rental agreement with at least 75% of the local customary rent and that we have to pay taxes on the rental income including ancillary costs. Here is the first question: is this done like with wage tax monthly or once annually with the tax return? Heating costs are counted as ancillary costs in rental agreements. How does that work with a heat pump? Because heating costs are electricity costs and tenants normally pay those directly to the utility provider, right?

What do we already have to consider now during planning and the construction phase to avoid problems with the tax office later or to be able to deduct as much as possible on the tax return? I have read several times that a granny flat would even “pay off” if rented to relatives. I can’t quite imagine that... but whatever, we are not building the granny flat to save money, but to spare my mother from the nursing home...

I have read that you should finance the granny flat separately from the rest, i.e. take out a separate loan because the interest incurred can be deducted from taxes. It sounds logical to me to invest the equity in the self-used part and to pay down the loan for the self-occupied part more, but how does that work in practice? Maybe you already have 2 loans anyway (KfW and a regular bank). Will that make 4 loans for a house with a granny flat?!

You can deduct 2% of the construction costs through depreciation. But how do you even determine those? Of course you can ask the general contractor for a separate invoice for, for example, the bathroom in the granny flat, but how about the rest? What do I need separate invoices for? And does that only count for the house or also (proportionally?) costs for ancillary building costs, outdoor facilities, carport, etc.?

Should one already get advice from a tax consultant in advance or is that overkill? If someone has done that, what does such advice cost?

So far, we have only had financing talks to see how much we can afford. We will only clarify the financing concretely when we know how much the house will cost or how high our loan requirement is. The general contractor is not really familiar with this (he probably doesn’t have to be), so I think he needs to be told by us what we need in terms of tax matters.

I wish you a nice weekend and thank you in advance

Many questions... Taxes are declared annually via the Est. declaration. Anlage Vermietung Verpachtung. Google it and take a look. Manufacturing costs are the costs of the apartment without the land and built-in furniture. How to determine in a mixed case? You know the house without land cost 412,000. It has 212 sqm living and usable space. Of that, 69 sqm are for the apartment. The rest is a rule of three. Consult a tax advisor beforehand. Yes. You don’t have one? Find one and pay 200,- for it. That’s already something. For good advice. Karsten

Thank you for the answer. Can any tax advisor do this or what should one pay attention to when choosing? So always calculate everything proportionally? Or only for the costs that cannot be separated? You can tile everything in the main apartment and only do the essentials in the granny flat or install electric blinds in the main apartment and manual blinds in the granny flat

Any tax advisor can do it.
At least they should.
Calculating proportionally is always a crutch. But how else do you want to do it with a [Einliegerwohnung]? It will hardly be possible to precisely calculate what it actually costs them.