We have added an important function to the calculation module in Investagon: you can now incorporate various tax benefits directly into your calculations and advise your customers even more transparently and comprehensively on financial matters.
The new calculation options at a glance:
- Degressive depreciation
- Depreciation according to §7b EStG
- Expert opinion on remaining useful life
- Maintenance expenses as income-related expenses
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Degressive depreciation: more flexibility in tax planning
With the temporary reintroduction of declining balance depreciation, the legislator is giving real estate investors the opportunity to claim higher depreciation amounts for tax purposes in the first few years after purchase.
The depreciation, which is 5 percent of the residual value of the building, applies to residential buildings that are built between the end of 2023 and the end of 2029 or for which a purchase agreement is concluded during this period. As the residual value of the building decreases annually, and therefore also the amount of depreciation, the tool automatically indicates when the optimum time is to switch back to straight-line depreciation.
As an Investagon user, you can now incorporate this information directly into calculations for prospective buyers: If your customer is interested in a property, you can show them in detail how the declining balance depreciation would affect their tax burden.
This gives your customers a more precise calculation and you can show that you always have your customers’ financial interests in mind and can find a secure way to make a lucrative investment even in economically uncertain times.
Depreciation according to §7b EStG: Relief for construction costs
Another important update relates to depreciation in accordance with Section 7b of the German Income Tax Act (EStG). Investors who rent out newly built apartments can, under certain conditions (in addition to the regular depreciation of 3 percent), benefit from special depreciation of up to 5 percent of the production costs per year for a maximum of four years.
One of the requirements is that these production costs are below the legally defined maximum limit and that the apartments are rented out for at least ten years. The aim of the legislation is to promote the construction of affordable rental apartments.
Since 2024, investors have been able to write off up to 32% of the production costs in the first four years. With the new function in our calculation module, you can inform interested parties transparently about the new depreciation option and offer them additional purchase incentives.
Increased depreciation rates through remaining useful life appraisals: Precise calculation of the depreciation period
The shorter the useful life of a property, the faster owners can depreciate it. Remaining useful life appraisals help to determine the useful life of existing properties and can lead to a substantial increase in depreciation rates – reducing your clients’ tax burden.
The update of the calculation module in the Investagon software allows you to provide your customers with detailed calculations of the expected depreciation based on a remaining useful life appraisal.
This provides potential buyers with precise information about the long-term financial benefits of an investment and positions you as a competent and reliable partner for real estate purchases.
Maintenance expenses as income-related expenses: optimizing the first tax return
An often underestimated but significant item in tax planning for property buyers is maintenance costs. Costs incurred for necessary modernizations in the first year after purchasing a property can be immediately claimed as income-related expenses for tax purposes.
It is therefore advantageous to offer an existing property with separately reported refurbishment work after purchase, then the refurbishment work can be written off as income-related expenses in the first three years and significantly lower ancillary purchase costs are incurred for this part.
As maintenance costs can significantly reduce your clients’ tax burden, you should take them into account in your calculations. With the latest software update, this is now easily possible in Investagon. Show your customers with just a few clicks that they can already enjoy tax benefits in the first year after buying a property.
Conclusion: Offer added value with comprehensive tax calculations
With the new functions in Investagon’s calculation module, you can offer your customers more precise calculations and real added value by taking current tax regulations into account in the calculated scenarios. You and your sales team can thus respond even more specifically to the individual needs of your customers and provide them with customized offers.
The option of incorporating tax benefits directly into the calculations makes your sales presentations even more convincing. They create transparency and trust – two decisive factors in building long-term business relationships.
Use these new features immediately to optimize your sales and advise your customers even better. Not yet an Investagon user? Then test the software free of charge and try out the new calculation options for tax benefits at your leisure.
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