The cost of maintaining and repairing buildings in defined redevelopment areas or urban development areas can be reduced, in some cases substantially, by tax concessions.
The claiming of tax concessions for modernization and repair measures within redevelopment areas and urban development areas requires the submission of a certificate from the municipality to the tax authorities.
This certificate is issued by the responsible municipality upon application. Members of the tax consulting professions can provide comprehensive advice on the details of possible tax concessions.
Measures that result in the construction of a new building are not subject to tax relief.
Production costs for (construction) measures as well as subsidies from renovation or development funds must be stated in the application.
The production costs for modernization and repair measures, less any grants, can be deducted up to 9% in the year of production and in each of the following seven years, and up to 7% in the subsequent four years.
In the case of properties used to generate income, maintenance expenses may, at the taxpayer's request, be deducted over two to five years instead of in one year. In the case of owner-occupied properties, the production costs can alternatively be deducted as special expenses at 9% for ten years.