Included wage costs according to Section 35a EStG

In this section, the wage and labour costs according to § 35a EStG for the selected tenancy are shown in the operating cost statement.

These amounts are no additional operating costs. So they neither increase the additional payment nor reduce a credit. The costs are already included in the respective operating cost items and are only shown here in addition so that the tenant can use them in his income tax return if necessary.

Legal background

Section 35a of the Income Tax Act allows taxpayers to obtain a tax reduction for certain household-related services and craftsmen's services. For household-related services, 20% of the expenses, up to a maximum of €4,000 per year, can be taken into account. For craftsmen's services for renovation, maintenance and modernisation measures, 20% of the expenses, up to a maximum of €1,200 per year, can also be taken into account. The following applies to paragraphs 2 and 3: Only labour costs are eligible for relief, and the prerequisite is generally an invoice and payment to the account of the service provider.

Tenants can also take advantage of this tax reduction even though they have not commissioned the craftsmen or service providers themselves. The Federal Fiscal Court has ruled that tenants can also assert Section 35a of the Income Tax Act if the contracts with the service providers were concluded by the landlord, administrator or a community of owners.

In the operating cost statement, the tax-relevant cost shares are shown in such a way that the tenant can see which share is attributable to him.

Typical examples are:

Caretaker / Caretaker

In the case of caretaker or janitorial services, wage cost components may be included, e.g. for:

• Control and maintenance of common areas

• Minor cleaning work

• Maintenance of the outdoor facilities

• Winter service

• Replacement of lamps, if billed as work

• Operation or control of technical systems

• Organisational activities within the framework of household-related services

Not everything that is billed under "caretaker" is automatically tax-privileged. Administrative work, general organisation, material costs or non-apportionable activities should not be reported as wage costs under Section 35a.

Chimney cleaning

Chimney sweep and chimney cleaning costs can be relevant for tax purposes as long as they are preferential labour, travel or craftsman costs.

Possible positions are:

• Chimney cleaning

• Chimney sweep services

• Measurement and verification work

• Fireplace inspection

• Exhaust gas path inspection

Heating costs

A particularly careful distinction must be made between heating costs. Not all heating costs are wage costs. Fuels, energy consumption, materials or pure consumption costs do not belong in the wage cost component. However, certain components of labour costs may be relevant for tax purposes, such as:

• Heating maintenance

• Repair of the heating system

• flushing or maintaining underfloor heating

• Maintenance of oil tank systems

• Tank cleaning

• Maintenance of pumps

• Maintenance of wastewater backflow protection systems

• Maintenance or repair of water installations

• Maintenance or repair of gas installations

• Maintenance or repair of electrical systems

Building Cleaning and House Cleaning

These may include, for example:

• Stairwell cleaning

• Cleaning of corridors, entrance areas and common areas

• Cellar cleaning, as far as common areas are concerned

• Window cleaning in common areas

• Cleaning of glass surfaces, doors or handrails in the common area

Garden and outdoor maintenance

This can include, for example:

• Lawn mowing

• Hedge trimming

• Tree pruning and shrub pruning

• Leaf removal

• Maintenance of beds, paths and green areas

• Weed removal

• Green waste disposal as an ancillary service to garden maintenance

• Maintenance of the outdoor facilities within the property

Winter service and sidewalk cleaning

These may include:

• Snow clearing on sidewalks

• Gritting of sidewalks

• Ice removal

• Clearing and gritting service on access roads to the house

• Cleaning of the sidewalk

When it comes to winter road maintenance, the distinction is important: the BMF catalogue distinguishes between roadways and pavements. The sidewalk may be favored, but caution is advised with the roadway. The Federal Fiscal Court recognised snow clearing as a household-related service in the specific tenant context, insofar as it not concerned the roadway.

Further information can be found here.

Elevator and technical inspections

Possible examples:

• Maintenance of the elevator

• Repair of the elevator

• Elevator emergency call, as far as eligible

• TUV or testing services for elevators

• Technical testing services for stairlifts

• Maintenance of technical safety equipment

Smoke detectors, CO₂ warning devices and safety devices

For example, the following can be relevant here:

• Functional test of smoke detectors

• Maintenance of smoke detectors

• Maintenance of CO₂ Warning Devices

• Fire extinguisher maintenance

• Maintenance of fire protection equipment

• certain technical inspections of installations

Show only labor costs, no material costs

It is important that complete invoice amounts are not simply accepted for the disclosure according to § 35a EStG. In principle, only labour costs are favoured. This also includes invoiced machine and travel costs. Material costs and delivered goods are generally excluded.

The share of labor costs must be shown in the invoice or in a comprehensible distribution. A percentage split by the invoice issuer is permitted. A mere estimate by the taxpayer, on the other hand, is not sufficient. In the case of maintenance contracts, the labour cost share can also be shown in an annex to the invoice.

Payment must have been made in cash

For tax recognition, § 35a EStG generally requires an invoice and a payment to the account of the service provider. Cash payments, cash deposits or cash partial payments, on the other hand, are not recognized.