An annual depreciation for the rented flat appears in a tax calculation. You want to deduce from this how much money is available for future repairs or how much the property has lost in value. The tax figure alone is not sufficient for that. It belongs to a different consideration than cash, debt and achievable sale price.
Classify the tax calculation correctly
§ 7 EStG governs deductions for wear and tear. For buildings, paragraph 4 names, among other things, percentages graduated by completion dates as well as rules for differing actual useful lives. [ESTG7] Which assessment basis and method apply to your flat must be examined by a specialist. This article does not derive an individual deduction amount from the purchase price of a listing.
For the following example all preconditions are deliberately assumed to be already clarified. That allows the effect to be explained without pretending a complete tax calculation.
The hypothetical example with a given tax rate
In the example the flat was completed in 1980. Under the assumptions here of the two‑percent rule and an assessment basis already professionally clarified at 180.000 euros, a depreciation of 3.600 euros would result for a full year. [ESTG7] Divergent methods or special circumstances are not used in this case.
These 3.600 euros are not transferred as cash to a repair account merely by the calculation step. Nor is the actual tax benefit automatically 3.600 euros. Its individual amount depends on the overall tax situation and is not calculated here.
A real reserve has a verifiable balance
If you set aside your own monthly amount for future works, that is an actually planned or executed cash transaction. Document it separately. A desired reserve is not present merely because the tax calculation shows a higher expense.
Conversely, a carried-out repair is a real payment. Its tax treatment requires its own classification. The account balance after the payment and the depreciation overview are not combined into a single number.
Assess the market value separately as well
The tax-based continuation does not by itself provide a currently achievable sale price. A sales decision requires an appropriate valuation and real market fundamentals. An example can therefore simultaneously show a tax residual value, a market value assumed differently from this, and little free cash, without there being a computational contradiction.
Enter the appropriate figure for each purpose: tax rate in the specialist tax calculation, cash balance in the payment planning and a traceable valuation in the asset assessment. The distinction protects against a repair reserve that exists only on paper and against an apparently precise sale statement derived from depreciation.