Kaufpreisaufteilung: why the land–building split changes your AfA

When you buy a rental apartment in Germany, only the building can be depreciated, not the land. The Kaufpreisaufteilung (purchase-price allocation) decides how much of the price and purchase costs sits in each part, so it fixes your annual depreciation (Absetzung für Abnutzung, AfA) for decades. A split written into the notarised contract is generally accepted for tax, provided it reflects real values. The goal is a split you can support with evidence, not the highest building share you can write down.

For the wider tax picture, see rental property tax benefits in Germany. The year-by-year schedule that follows from the split is in our AfA schedule guide.

The Income Tax Act sets an annual rate of 2 per cent for residential buildings completed between 1925 and 2022 (§ 7(4) EStG) and applies the same rules to condominiums (§ 7(5b) EStG). Land is not depreciated.

So the purchase price and the acquisition costs (transfer tax, notary, land registry and any agent's fee) have to be divided. Under Federal Fiscal Court (Bundesfinanzhof, BFH) case law, the division follows the ratio of the market values of land and building. Valuing the land and calling the rest of the price "building" (the residual-value method) is not allowed (BMF instructions, citing BFH IX R 86/97 of 10 October 2000).

With an apartment, you buy a co-ownership share (Miteigentumsanteil) of the whole plot, stated in the declaration of division (Teilungserklärung). Your land value is that fraction of the plot's value.

Buyer and seller can state the split in the purchase contract. The BFH has held that a contractual split is used for depreciation unless it is a sham, an abuse of legal arrangements, or, weighing all the circumstances, it fundamentally misses the real value ratio and appears economically untenable (BFH IX R 12/14, 16 September 2015). The judgment notes that buyers typically want a higher building value, which is why tax offices check.

A private seller often has little at stake in the figure, so the signature proves little. Agree the clause with the evidence in hand and have it recorded in the deed itself; see our notary guide.

The usual check compares the contract's land share with a figure built from public data, starting with the standard land value (Bodenrichtwert). A Bodenrichtwert is an average value per square metre for a zone, set by the local valuation committee (Gutachterausschuss) from actual sales. In built-up areas it is the value the land would have if unbuilt, and anyone can ask for it (§ 196 BauGB).

For Leipzig and Dresden, look it up on BORIS Sachsen, the free state portal. For Berlin, BORIS Berlin offers a free address search (German-language sites). Use the value for the last valuation date before your contract, as the BMF instructions require, and save a dated printout.

The Federal Ministry of Finance (BMF) publishes a spreadsheet, the Arbeitshilfe zur Aufteilung eines Gesamtkaufpreises für ein bebautes Grundstück, with instructions (BMF). The current version is dated February 2026 (KPMG, 11 March 2026). Its instructions call the result a "qualified estimate" that expert reasoning can rebut, usable to make a split or to test one.

For an apartment, it works like this:

• Land: plot size × Bodenrichtwert × co-ownership share.
• Whole apartment: the comparison method where the valuation committee publishes comparison factors (Vergleichsfaktoren) for condominiums; otherwise the income method, using the actual or usual rent; the cost method only as a fallback.
• Building: whole value minus land. The resulting ratio is applied to the price including acquisition costs.
• Date: the contract date. The handover date does not matter for the split.

Know its limits:

• It is typified. Unusual features of your property, such as defects, special rent terms or encumbrances (§ 8(3) ImmoWertV), are ignored.
• Location factors default to neutral. In the cost method, the regional building-cost factor and the market-adjustment factor are 1.0 unless you enter local figures; in the income method, a standard capitalisation rate replaces a missing local one.
• The land figure follows a legal fraction. The co-ownership share is fixed in the Teilungserklärung and need not mirror your unit's share of value.
• The Bodenrichtwert describes a reference plot. If yours differs, for instance in density, an adjusted value may be entered with a written explanation.

Courts are not bound by it. In BFH IX R 26/19 (21 July 2020), the court held that a contractual split may not simply be replaced with the aid's result, criticised the then version's method, and said a court should normally obtain a report from a publicly appointed and sworn valuer.

Illustrative example. Fictional figures, not a real property, valuation or tax advice. Apartment A: Leipzig, 65 m², building completed 1996, tenanted. Price €240,000. Acquisition costs €25,368 (transfer tax €13,200, agent €8,568, notary and land registry for the purchase €3,600), so a cost base of €265,368. The €1,200 notary and registry cost for the bank's land charge (Grundschuld) is a financing cost and is excluded. Contract signed 15 January 2026; handover 1 April 2026. Straight-line AfA at 2 per cent. Assumed marginal income-tax rate 42 per cent, excluding solidarity surcharge and church tax.

Split 1, the contract: 25 per cent land, as agreed with the seller.

Split 2, a land-value calculation in the style of the BMF aid: plot 1,250 m², co-ownership share 64/1,000, an assumed Bodenrichtwert of €900/m² (fictional, not the value of any real Leipzig zone). Land value: 1,250 × €900 × 0.064 = €72,000. Taking the apartment's market value as the €240,000 price, land is 30 per cent.

The first year, 2026, is a part year from handover; the schedule guide shows it. The tax effect arrives through the annual assessment, not as monthly cash.

Five percentage points move €13,268.40 from building to land, permanently: land is never depreciated.

Which is right? The contract's 25 per cent is what the same calculation gives at €750/m², so the question is whether the €900 zone value and the €240,000 fit this apartment. That is for evidence and a tax adviser (Steuerberater), not preference. If the evidence points to 30 per cent, writing 25 per cent to gain €111 a year invites a dispute that can cost more than it saves.

A market-value report (Verkehrswertgutachten) values the property at the price it would fetch in ordinary business on the valuation date (§ 194 BauGB). For a split, it should value land and building separately, as at the contract date. It can come from a publicly appointed and sworn valuer, a certified valuer, or the local valuation committee itself, which prepares reports at an owner's request (§ 193(1) and (3) BauGB). No report binds the tax office.

A report helps most where the tool fits badly: high land values, an unusual co-ownership share, or a split far from the tool's result. Without a contractual split, values are determined separately and costs divided in their ratio; in October 2025 the BFH accepted a valuer's income method for a listed building (BFH IX R 26/24). Weigh the fee against the stake: in the example, about €111 a year.

Proposed change, not current law. The government's draft Annual Tax Act 2026 (Jahressteuergesetz 2026) would add a new § 6f EStG (Bundesrat document 447/26, 14 August 2026). It would put the contract test and the BMF aid into law, and accept a split departing from the aid's result only on a report written after a personal on-site inspection by a publicly appointed and sworn valuer or one certified under DIN EN ISO/IEC 17024. It would apply to contracts signed after the law is promulgated. The Bundesrat gave its statement on 25 September 2026 (447/26 (Beschluss)); the bill can still change.

A different split from the tax office appears in your assessment. You can lodge an objection (Einspruch) within one month of notification (§ 355(1) AO).

Keep one file, alongside your tax records:

• the notarised contract with the allocation clause;
• dated Bodenrichtwert printouts;
• plot size and co-ownership share from the contract or Teilungserklärung;
• the lease;
• any BMF tool printout, valuation report and adviser's note.

During a purchase in Berlin, Dresden or Leipzig, Alpha Minoris's Buyer's Agent service can assemble the contract draft, the Teilungserklärung, the owners' association (WEG) records and the property details for your Steuerberater or valuer before the contract is notarised. You need not live in any of the three cities. Alpha Minoris does not value the property or certify the split; the valuer values, your adviser advises and the notary records.

If you are buying, settle the split with your adviser before the notary appointment, while the evidence is easy to gather. Discuss your first rental property with Alpha Minoris.