Renting out your own apartment and earning a few extra euros? Depending on the city or municipality, daily or weekly rentals may be permitted, as long as more than half of the apartment is still used by the owner. Other municipalities regulate that short-term temporary rentals (daily or weekly) of apartments are limited to twice a year or that it is possible to rent out to holidaymakers no more than 50 percent of the apartment occupied by the owner, according to the misappropriation statutes.
Due to the housing shortage, large cities in particular are restricting short-term apartment rentals with so-called squatter statutes. Before listing your apartment online, ask your local government what rules apply in your city. If necessary, obtain a permit, otherwise you could face hefty fines. Stiftung Warentest explains the most important questions about renting on portals like Airbnb.
Declaring income to the tax office
Very important: Anyone who rents out their apartment in whole or in part via online portals must declare this income to the tax office. Landlords use Appendix V for this purpose. In the case of holiday rentals or short-term rentals, Appendix V-FeWo must also be completed. Tenants who sublet require Appendix V-Other.
Free limit of 520 euros per year
Income up to 520 euros per year remains tax-exempt. Those who use this simplification rule cannot deduct any costs incurred in renting.
All questions at a glance
Landlord’s rights
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As a tenant, do I have to ask the landlord for permission?
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Yes, you need your landlord’s express consent to rent out your apartment to holiday guests. A mere subletting permission, which may already be included in the lease agreement, is not sufficient for short-term rentals to arbitrary guests. The Federal Court of Justice has ruled that daily rentals to changing holiday guests are something completely different from a classic sublet that is intended to be permanent, at least for months or years (BGH, Ref. VIII ZR 210/13).
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What is behind the Federal Court of Justice’s decision?
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In this particular case, the tenant had a subletting permit from his landlord for his two-room apartment in Berlin. He offered his apartment online to tourists on a daily basis. The landlord considered this a breach of contract and warned him. After the offer became available on the Internet again, he withdrew. The judges agreed with the landlord: the tenant should not have rented it out to tourists, because giving the property to random guests was different from classic subletting.
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Can my landlord give notice if I rent without permission?
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Yes, even if your landlord only prohibits you from re-renting to guests who change guests daily or weekly in the future, in the worst case scenario he can give you a notice of termination: If you rent to tourists without their consent, you are in breach of contract and risk termination under certain circumstances even without notice (Regional Court Berlin, Ref. 67 S 360/14).
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Is there a risk of termination even if I have only rented once?
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No, if a room is rented on a one-off, daily basis via an online portal without the owner’s permission, the breach of contract is not so serious as to justify termination (AG Frankfurt, Ref. 33 C 2762/15 (51)).
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Can my landlord refuse permission?
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Your landlord will hardly object to you occasionally renting out individual rooms. Especially if the rent is within reasonable limits. It is a different matter if it causes disturbances to the neighbors, such as noise or dirt. However, your landlord may refuse if you want to sublet the entire apartment.
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Who is responsible for any damage to my rental apartment?
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As the primary tenant, you must pay the landlord for all damages, including: Noise pollution through your guests, stand. Repeated disturbances of the peace by noisy or drunk guests may, in serious cases, lead to termination of the rental agreement.
Prohibition of misuse
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Can the city also prohibit subletting?
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Yes, if there are regulations regarding the misappropriation of residential space in your state or city. Then renting out your entire apartment to tourists for a short period of time may not be allowed. Find out what applies in your area. Otherwise, you could face steep fines.
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What regulates this prohibition on misappropriation?
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These regulations are intended to prevent existing housing from being used commercially. Therefore, cities with housing shortages in particular prohibit the rental of apartments as commercial premises or holiday homes. House and apartment owners and tenants must adhere to this. However, private individuals who only occasionally rent out individual rooms in their apartments are usually not subject to the ban.
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Are public regulations the same everywhere?
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Regulations vary greatly in detail. In most cities, the ban does not apply if the owner continues to live in the apartment, i.e. he or she only rents it out for a limited time and space.
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Where can I find out more about the specific regulations?
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If you plan to frequently offer your apartment for rent on the Internet for short periods of time, check with the relevant district office of your city or municipal administration whether you are allowed to do so without restrictions.
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What happens if I don’t comply with the ban?
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Violations such as renting out an apartment as a holiday home without official approval result in hefty fines of up to 50,000 euros, in Berlin up to 100,000 euros. Munich plans to increase the fine limit to half a million euros. It does not matter whether the apartment is rented out directly to holidaymakers or via online portals. Please note: In Berlin, neighbours can report illegal holiday apartments anonymously on the Internet.
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Are there also exceptions to the prohibition on misuse?
Yes, in the case of a vacancy that is unused due to a ban on use. The Bavarian Administrative Court (BayVGH, Ref. 12 B 21.913, not yet binding) ruled on this in a ruling. Accordingly, a Munich flight attendant can rent out her apartment on Airbnb despite the ban on misuse if she is traveling for work.
The prohibition on embezzlement is intended to prevent the loss of living space. However, the flight attendant’s condominium would remain pointlessly empty if she could not rent it out during her business trips. The city of Munich must therefore approve the lease for up to eight weeks per year, the senior administrative judges in Ansbach ruled. However, the city of Munich can still apply to the Federal Administrative Court for leave to appeal (ref. 12 B 21.913).
Tax aspects
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Do I have to pay tax on my rental income?
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Basically, as a landlord, you must declare your rental income in your income tax return on “Annex V”. The V-FeWo facility has also been added since 2023. Tenants who sublet parts of their apartment via Airbnb declare their income via Annex V-Other (line 22). Regardless of whether you are a landlord or a tenant, as a casual landlord you benefit from an exemption limit: income up to 520 euros per year remains tax-exempt. In this case, you cannot deduct any rental costs. Important: If you exceed the mentioned de minimis limit, you must pay full tax on all income, but you can offset your costs.
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What exactly should I tax?
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As a landlord, you enter your income on the front of Schedule V. In addition to the rent for the room, you also include your bread money, laundry service, and final cleaning expenses. Your advertising costs are on the back. In addition to the pro rata depreciation of the building and the furnishings of the rented rooms, you also include pro rata interest on debts, as well as all advertising fees, brokerage commissions for online portals, and cleaning costs. You can even deduct equipment such as a dryer or coffee maker that you bought specifically for the purpose of renting. You only have to pay tax on the excess (rental income minus business expenses). If you made a loss, you will receive a tax refund.
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As a tenant, can I offset my own rent?
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Yes, tenants receive pro rata rent plus rental income. extra costs absent. Costs proportional to the area and time of the rented rooms are deductible. Since 2023, tenants must separately declare the surplus from the sublease on line 22 of Annex V-Miscellaneous.
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When am I considered a commercial host for tax purposes?
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The boundaries between private renting and commercial operations are fluid: If you do not offer any services other than room, bread and laundry service, you are still a private landlord (FG Berlin-Brandenburg, Ref. 14 K 1355/06 B). Business tax is only an issue if you have built up a second professional base through short-term rentals and your business operations are comparable to those of a hotel or guesthouse. Then you must register a company with your city administration. However, you only pay business tax if your profit exceeds a subsidy of 24,500 euros per year.
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Am I subject to VAT if I rent multiple times?
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No. You will only have to pay VAT if your rental income for the entire year is more than €22,000. If your gross income does not exceed this threshold, you may be exempt from sales tax as a small business owner. This means that you do not pay any sales tax on your income, but you also cannot deduct any input tax paid on invoices.
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Will the tax office notify me if I do not declare my income?
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You should not pocket the money you have earned without tax, the risk of discovery is high: tax authorities are increasingly monitoring online earning opportunities, including online brokerage portals such as Airbnb, booking.com, 9flats or Wimdu. If requested by the authorities, the portals must disclose all rentals brokered in recent years. This will also apply for the first time in 2023. Platform Fiscal Transparency Act (PStTG). Online portals automatically report sales made above the 2,000 euro limit to the tax authorities.