Interest on a planned rental property is already incurred, even though no rent has yet been received. The tax calculation treats it immediately as an expense of the rental activity. Before making such an assumption, it must be clarified which actual circumstances support the intended generation of income.
Check the connection with the specific property
§ 9 EStG refers to the economic connection of the expense with the type of income. The BFH explains in the judgment of 06.09.2016, IX R 19/15, the examination of advertising expenses incurred in advance: the decision to rent must be made definitively and be assessable on the basis of objective circumstances. Financing alone does not prove this decision. [GRUNDLAGE][ABSICHT]
This page does not confirm a deduction for a particular financing. It also does not treat historical home owner subsidies from the court case at the time as current support. The examined thought process used is the delimited consideration of actual intent and objective connection.
Establish a chronological sequence of facts
Compile acquisition or construction plans, loan utilisation, actual interest payments and decisions about later use with their dates. Which documents show that this very property was intended for letting? When was the scope determined? Were there, in addition, plans for owner occupation or a sale?
An empty field is referred to as lacking evidence. A general statement drafted later retains its actual date of creation. The documentation must not be altered by subsequent backdating that appears to fit.
Disclose contradictions openly in the advice
In the hypothetical case the first financing application states owner occupation. Only later is the flat to be let. The advice must examine the actual change and its timing; the new intention must not be applied unnoticed to the entire earlier period.
Another case may be aimed at letting from the outset and still fail. The BFH describes that missing income does not by itself exclude a deduction for expenses incurred in advance. The overall circumstances remain decisive. [ABSICHT] This does not imply a blanket recognition of all costs of a failed project.
Be able to carry the financial plan independently
The actually due interest is fully recorded in the financing plan, even while the tax treatment is unresolved. An expected reimbursement receives amount and timing only after appropriate professional classification. Correct allocation of an expense is not yet an inflow of funds for servicing the loan.
The prepared review order therefore consists of an honest timeline and concrete proof of use. It does not replace a tax assessment. However, it enables a significantly more factual examination than the assumption that, for a presumed investment property, all prior interest is automatically deductible.