Depreciation (AfA) calculator

How do you calculate AfA (depreciation) on a property?

Annual AfA (Absetzung für Abnutzung, depreciation) = depreciation basis × AfA rate. The depreciation basis is the building share of purchase price plus closing costs, because land does not wear out and is not depreciated. On a basis of €264,000 at 2% that is €5,280 per year.

You can only deduct AfA on property you earn income from, which means rented property. It counts as Werbungskosten (income-related expenses, § 9 Abs. 1 Satz 3 Nr. 7 EStG, the Income Tax Act) and reduces your rental income without any money leaving your account.

The calculator shows the depreciation basis, AfA per year and per month, and the annual tax reduction: AfA × marginal tax rate.

Which AfA rate applies to my property?

That depends on the year of completion (§ 7 Abs. 4 Satz 1 Nr. 2 EStG): 2.5% for buildings completed before 1925, 2% for completion from 1925 to 2022 and 3% for completion from 2023. What counts is the year the building was completed, not the year you bought it.

If the actual useful life is shorter, you may depreciate over that instead (§ 7 Abs. 4 Satz 2 EStG). The rate is then 100 ÷ remaining useful life in years, so 4% for 25 years. You have to prove the shorter useful life to the tax office, as a rule with an expert report. In the calculator you choose the custom remaining useful life for this.

How much tax does AfA save?

Tax saving = AfA × marginal tax rate. On €5,280 of AfA at 42% that is €2,217.60 a year. The calculator shows the amount as the tax saved per year.

The building share decides how much it is. The 80% in the calculator is a starting value, and where land is expensive the share is often well below that. In the example, a building share 10 percentage points lower means €660 less AfA and €277.20 less tax saved per year.

If you sell within ten years, the saving is not final: the AfA you claimed then increases the taxable gain on the sale (§ 23 Abs. 3 Satz 4 EStG). In the year of purchase you also only get AfA pro rata for the months from acquisition, while the calculator shows a full year.