Depreciation calculator — calculate tax savings

Non-binding orientation aid and not tax advice

A remaining useful life appraisal report can significantly increase your annual depreciation — and thereby permanently reduce your tax burden as a real estate investor. Calculate here how much you can additionally save compared to the statutory depreciation.

All information provided without guarantee. This calculator serves as non-binding orientation and does not replace tax advice.

Purchase & incidental costs

purchase price

EUR

50,000EUR 20 million

Federal state (real estate transfer tax)

Notary & land register 2,0 % Notary + land register entry — typically 1.5–2.5% of the purchase price

0 %5 %

Broker commission 3,57 % Usually 3.57% per party (incl. VAT) — in some cases 0%

0 %8 %

Handover date (transfer of possession, benefits and burdens) 01,2024

Jan 2000

Property

Year of construction (economic) 1985 (41 yrs) In the case of full refurbishments, the economic year of construction may differ from the actual one.

19002025

Land share 20 % Only the building share (= 100% minus land share) is tax-deductible via depreciation.

0 %80 %

Rural5–15 % Suburb15–25 % City25–40 % City centre40–60 % Prime location60–80 %

Tax & Appraisal

Income tax rate 42 % 42% top rate Your personal marginal tax rate. The higher the rate, the greater the savings from depreciation.

14 % 45 %

Remaining useful life (appraisal report)

Remaining useful life determined by appraisal 28 years The shorter the remaining useful life, the higher your depreciation rate. A valuer determines the exact figure.

10 yrs50 yrs

Refurbishment
needs10–20 yrs Period building20–30 yrs Existing stock30–40 yrs Modernised40–47 yrs new build47–50 yrs

appraisal costs —

Results

Building value (depreciation base)

—

—

Tax savings — statutory depreciation (2% p.a.)

—

Tax savings — with appraisal report

EUR / year

—

—

over 10 years

—

—

Optimise your taxes now

Statutory With appraisal report

Depreciation rate — —

Building value — —

Annual depreciation — —

Tax savings / year — —

Tax savings over 10 yrs. — —

Additional tax savings possible through an appraisal report over 10 years —

Purchase price allocation

Cumulative tax savings — 30-year progression

Depreciation schedule

Year	Statutory depreciation	Statutory book value	Depreciation per appraisal report	Book value per appraisal report	Savings
Enter your details …

Have your precise value determined through an appraisal report A remaining useful life appraisal report pursuant to Section 7 (4) sentence 2 EStG (German Income Tax Act) can substantiate the actual remaining useful life of your property vis-à-vis the tax office, thereby securing you a higher depreciation rate than the statutory 2–3% per annum.

Frequently asked questions about the depreciation calculation

What is depreciation — and why is it worthwhile for real estate investors?

The depreciation for wear and tear (AfA) is a tax benefit: the tax office recognises that buildings lose value over time and allows you to deduct this loss in value annually as income-related expenses. Pursuant to Section 7 (4) EStG (German Income Tax Act) you can, as a flat rate, claim 2% of the building value per year for tax purposes. This reduces your taxable income — and thus your tax burden — permanently over the entire depreciation period.

Why can I depreciate more than the statutory 2% with an appraisal report?

Section 7 (4) sentence 2 EStG (German Income Tax Act) permits a higher depreciation rate if the actual remaining useful life of your building is demonstrably shorter than the standard 50 years. An expert opinion provides exactly this proof — and the tax office must accept it (Federal Fiscal Court, ruling of 28.07,2021). The shorter the remaining useful life determined by the appraisal, the the higher the individual depreciation rate: for a remaining useful life of 25 years, for example, 4% instead of 2% per annum.

What is the difference between the purchase price and the depreciation basis (building value)?

Not the entire purchase price is depreciable. The tax office distinguishes between two portions:

Building portion → depreciable (the building wears out)
Land share → not depreciable (land does not lose value)

The land portion depends heavily on the location: in large cities often 40–60%, in rural areas typically 10–20%. Based on this, our calculator automatically determines your personal depreciation basis.

What does a remaining useful life appraisal report cost — and when does it pay for itself?

Depending on the property value, the appraisal report costs typically range between €500 and €3,000. Decisive factor: the costs themselves are tax-deductible as income-related expenses. As a rule of thumb — it's worthwhile if the additional annual savings compared to the statutory depreciation exceed the appraisal costs within 2–4 years. Our calculator shows you the payback period directly in the result.

For which properties is an appraisal report particularly suitable?

An appraisal report is particularly worthwhile for:

Buildings with year of construction before 1990
Properties with a discernible need for or backlog of refurbishment
Higher purchase prices with a large building share
A personal tax rate from approx. 35%

For new builds (year of construction after 2000) and low purchase prices, the benefit is often minor — an appraisal report is less worthwhile in such cases.

How long does the increased depreciation (AfA) rate apply?

Exactly as long as the remaining useful life determined in the appraisal report lasts. If the remaining useful life according to the appraisal report is, for example, 28 years, you can apply the higher depreciation (AfA) rate for 28 years — after which the building value is fully depreciated for tax purposes. The appraisal report is submitted once to the tax office and applies to all subsequent years.

Does this calculator replace an expert appraisal report or tax advice?

No. The calculator serves exclusively for non-binding orientation. It does not calculate a legally binding depreciation basis and does not take into account individual tax particularities. All information provided without guarantee. For reliable tax optimization, we recommend consulting a tax advisor as well as commissioning an expert opinion pursuant to Section 7 (4) Sentence 2 of the German Income Tax Act (EStG) from a publicly appointed valuer.

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Archiv

tax office

property tax

What happens if I have not submitted the assessment declaration at all?

If the declaration of assessment is not submitted by the deadline, the tax office may estimate the property tax value and additionally impose late filing surcharges as well as coercive fines. A subsequent submission is nevertheless generally still possible.

property tax

Can I have the property tax deferred if I am unable to afford it financially?

In the event of proven temporary insolvency, the competent municipality may grant a deferral of property tax upon application, provided that the claim is not thereby jeopardized and adequate security is provided.

property tax

What happens in the case of incorrect information in the declaration of assessment?

Incorrect information can lead to an inaccurate property tax value notice and should be corrected as quickly as possible by filing an objection or a correction notice with the tax office in order to avoid lasting financial disadvantages.

Inheritance & Gifting

Within what deadline must proof of a lower value be submitted to the tax office?

There is no legally fixed deadline for preparing the appraisal report; however, the proof should be submitted within the one-month objection period against the assessment notice or before it becomes final and binding.

Inheritance & Gifting

How is the value of an inherited property determined for the tax office?

For inheritance tax purposes, the tax office determines the property value automatically using a standardized procedure (sales comparison, income, or cost approach pursuant to § 182 et seq. BewG). This value is often higher than the actual market value – an independent appraisal report can correct it by providing proof of a lower fair market value (§ 198 BewG).