You are letting an Austrian condominium and the first annual accounts are negative. You might expect to be able to use those losses for tax purposes as a matter of course. Before you base a financing or purchase decision on that, the Liebhabereiprüfung must be included in the professional planning. This article deals with the Austrian small-scale letting and not with any German regulation on discounted letting.
First determine the appropriate tax framework
§ 1 Absatz 2 Ziffer 3 der Liebhabereiverordnung covers losses from the management of owner-occupied houses, condominiums and certain rented residential properties. The presumed Liebhaberei there can be excluded under § 2 Absatz 4 if the specific management is expected to produce an overall surplus within the relevant period. Not every property letting is therefore assessed in the same way. [EINORDNUNG] [PROGNOSE]
Our practical recommendation: Have the specific activity classified first. Number and type of units, rights of use, start and actual plan should not be set only after a desired result figure. An advertisement using the word “Anlagewohnung” is not proof of tax recognition.
An annual loss account is not yet an overall prognosis
The question is not only whether money is missing in a particular year. The regulation focuses on the expected overall result of the management over the foreseeable period. A comprehensible prognosis must therefore bring together the relevant future income and expenses. [PROGNOSE]
Prepare the actual rental contract, financing, foreseeable maintenance works and available annual figures for that purpose. Separate supported amounts from assumptions. If a future rent increase or avoided repair saves the result, it must be visible on what basis exactly this assumption rests. The tax-correct treatment of individual items will be clarified in consultation.
The longer period does not simply apply to every legacy case
The current version of § 2 Absatz 4 specifies 25 years from the start of the paid provision for small-scale letting, at most 28 years from the first incurred expenses. § 8 Absatz 4 limits the application of the extended version to activities with a corresponding start of the foreseeable period after 31 December 2023. [PROGNOSE] [UEBERGANG]
The BMF maintenance decree 2025 explicitly explains: First expenses incurred before 2024 can lead to the earlier period of 20 or at most 23 years remaining decisive despite a later rental start. It is therefore not sufficient to look only at the year of the first rent payment. [BMF]
Record both starting dates with evidence for the assessment. A spreadsheet newly started today does not reset the actual start. A changed management also needs its own professional classification; earlier years are not arbitrarily replaced by a desired new start.
Two plans in a hypothetical comparison
In the fictional case, Nina incurs expenses for a condominium before the first letting. A sales brochure later shows a positive surplus, but for that it uses the longest known period as a flat assumption. Nina's own documents show an earlier start that was not taken into account there.
She therefore has the applicable period examined first and then the revenue and expense assumptions. In addition she prepares her personal cash-flow plan. The fact that she can cover an ongoing loan payment from her salary does not yet answer the tax overall result of the letting. Conversely, a positive tax prognosis does not guarantee sufficient liquidity at all times.
Keep actual developments alongside the original plan
Our editorial recommendation is to keep the original plan and document later results alongside it. Describe why a deviation occurred. A longer vacancy period, different financing or changed use must not disappear unnoticed from the presentation.
Also inform your adviser about a planned early sale or the conversion to owner-occupation. Such changes belong in the assessment of the actual management plan. An originally used long-term prognosis is not a carte blanche for any subsequent course.
Your prepared file should in the end connect classification, starting data, calculation assumptions and actual development. That way a tax expectation becomes verifiable before you treat it as a secure financial advantage. No general internet calculation decides on the concrete case.