How to split land and building value for German AfA
Kaufpreisaufteilung, BMF tool, land value and building depreciation basis
1. The direct rule
AfA under §7 EStG applies to the depreciable building basis. Land is not worn out for tax depreciation, so the total purchase price for a built property has to be split before the annual AfA figure is calculated.
2. What the BMF work aid does
The Federal Ministry of Finance provides a Kaufpreisaufteilung work aid and guidance for splitting a total purchase price between land and building. It is useful when the purchase contract has no reliable split or when a rough percentage would be hard to defend.
3. Inputs to collect
Collect the notarial purchase contract, purchase price, acquisition costs, land register or co-ownership share, property address, plot size, apartment co-ownership fraction, year of construction, living area and the relevant Bodenrichtwert. Keep the source for each number.
4. Example
Purchase price: 420,000 EUR. Incidental acquisition costs: 42,000 EUR. Supported building share: 70 %. Depreciable building basis: 323,400 EUR. At a 2 % annual AfA rate, the full-year deduction is 6,468 EUR before any first-year pro rata.
5. What Anlage V Easy prepares
Anlage V Easy can carry the land/building split into the AfA schedule and ELSTER-ready report. It does not certify the split, override a notarial contract, submit to ELSTER, or argue with the Finanzamt if the split is challenged.
Common questions
What is the short answer on How to split land and building value for German AfA?
For German AfA, you depreciate only the building, not the land. A purchase price must therefore be split between Grund und Boden and Gebäude. The BMF provides an official Kaufpreisaufteilung work aid. Use the contract and local land values as evidence; do not rely on a flat 80/20 shortcut in high-value cities.
What should I know about the direct rule?
AfA under §7 EStG applies to the depreciable building basis. Land is not worn out for tax depreciation, so the total purchase price for a built property has to be split before the annual AfA figure is calculated.
What should I know about what the BMF work aid does?
The Federal Ministry of Finance provides a Kaufpreisaufteilung work aid and guidance for splitting a total purchase price between land and building. It is useful when the purchase contract has no reliable split or when a rough percentage would be hard to defend.
When should a foreign landlord use a Steuerberater instead?
Use a Steuerberater for complex ownership, short-term rental with services, sale-year issues, inheritance, treaty conflicts, disputes with the Finanzamt, or any case where the tax position needs personal advice.
Last reviewed: by Yann Lephay.
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