Are energy certificate costs tax-deductible? How to save tax the right way

Joost Jansky

Energieberater, Blogger

Energy certificate costs tax-deductible: The basics

Tax deductibility of energy certificate costs is not automatic. You must meet certain conditions and have the right documents. But if you do it right, you can save real money — from €40 for a cheap consumption-based certificate to several hundred euros for more expensive options.

When costs are "tax-deductible", it means you can deduct these expenses from your taxable income. That reduces your tax burden and saves you money. The amount you save depends on your personal tax rate.

German tax law has different categories of deductible costs: Income-related expenses are costs linked to earning income, for example for rented properties. Business expenses apply to commercial activity and reduce profit. Special expenses are personal outlays deductible in certain cases — generally not relevant for energy certificate costs.

A central rule for deductibility of energy certificate costs: The costs must be directly linked to earning income.

Energy certificate for rental and sale

If you rent out a property, you are in the best position: You can usually deduct the full cost of the energy certificate from tax. This is one of the most common and straightforward cases — and one of the most beneficial for tax savings.

The energy certificate is legally required when you rent out a property. Because it is directly linked to earning your rental income, it qualifies as income-related expenses. The costs reduce your rental income, you pay less tax on that income, and deductibility does not depend on whether you choose a demand-based or consumption-based certificate.

To deduct energy certificate costs as income-related expenses, the property must actually be rented (not only planned or temporarily empty), the certificate must be required for the rental (which is usually the case, as it is legally required for rental), you need a proper invoice with all required details, and payment must be made by non-cash means (transfer, not cash).

From a tax perspective there are no differences between a demand-based and a consumption-based certificate. Both can be fully deducted as income-related expenses. However, there is an important practical difference in cost.

Practical example: The Müller family rent an 80 m² flat in Munich for €1,200 cold rent per month:

So even after tax saving, the consumption-based certificate is clearly cheaper. The choice should therefore be based mainly on legal requirements (more details: Demand-based certificate for residential buildings), not on tax savings.

For deduction as income-related expenses you need an invoice from the energy expert with all required details (name, address, type of certificate, date, property address), proof of payment (bank statement, transfer receipt) — non-cash payment is required —, proof of rental (tenancy agreement or rental confirmation) and the property address for reference. Keep these documents for at least 10 years, as the tax office can request them in an audit.

If you sell a property, you can also deduct the cost of the energy certificate under certain conditions. But note: Deductibility depends crucially on when you sell. Did you acquire the property less or more than 10 years ago? That decides your tax saving.

If you sell a property within 10 years of acquisition, the disposal gain is subject to income tax (so-called speculation tax under §23 EStG). In this case you can deduct the energy certificate costs as disposal costs from taxable gain. The costs reduce your taxable disposal gain, you pay less tax on the sale gain, and deductibility is possible because the certificate is directly linked to earning income.

Disposal costs are all costs directly connected with the sale of the property. These include broker fees, notary fees, land register costs and energy certificate costs (as legally required for sale). These costs are deducted from sale proceeds before taxable gain is calculated.

Practical example: Mr Schmidt bought a flat for €250,000 in 2015 and sells it in 2023 for €300,000 (after 8 years, within the speculation period):

If you sell the property more than 10 years after acquisition, the sale gain is generally tax-free. In that case you cannot deduct the energy certificate costs, because there is no taxable gain against which to set the costs. In that case you should choose a cheap online certificate, as there is no tax saving.

Energy certificate for owner-occupied properties

For owner-occupied properties it gets more complicated: Tax deductibility is much harder, but not impossible. If you live in the property yourself and neither rent nor sell, the direct link to earning income is missing. The costs are purely private expenses and are generally not deductible as income-related or business expenses.

Under certain strict conditions, however, energy certificate costs can be deducted as household-related services under §35a EStG. Critical: The service must be performed in the household. That means an on-site visit by the energy expert is mandatory. Purely desk-based work (e.g. online certificate without a visit) is not accepted. The expert must actually visit and assess the property. An online certificate where you only enter data generally does not qualify under §35a EStG.

Under §35a EStG only labour costs are deductible, not materials. The invoice must therefore separately show labour costs (e.g. for the on-site visit and calculation) and material costs (e.g. for software, registration). The tax saving is 20% of labour costs, deducted directly from tax liability (not from taxable income), maximum €4,000 tax saving per year (equivalent to €20,000 labour costs).

Practical example: For an energy certificate with an on-site visit:

Ensure the invoice separately shows labour and material costs. Many energy experts do not do this automatically — ask explicitly!

Payment must be non-cash (transfer, direct debit, etc.). Cash payments are not accepted by the tax office. Important: Acceptance of energy certificate costs as household-related services varies from tax office to tax office. Some accept it, others refuse; there is no uniform practice. Declare the costs in your tax return. If the tax office refuses, you can object. If in doubt, consult a tax adviser.

If the energy certificate is produced as part of energy renovation, the costs can be tax-advantaged under §35c EStG: 20% of renovation costs spread over 3 years, maximum €40,000 per residential building. This is a separate tax benefit and should not be confused with §35a EStG.

Energy certificate for commercial use

If you use a property commercially (e.g. as property management, broker, developer), you have the best tax conditions: You can deduct energy certificate costs in full as business expenses — without the restrictions that apply to private use.

Business expenses are all costs incurred in the course of your commercial activity. Energy certificate costs are business expenses when the property is part of your business, the certificate is required for commercial use and the costs arise in the year of acquisition.

Unlike §35a EStG (20% for private use), you can deduct much more for commercial use:

Differences between demand-based and consumption-based certificates

Many owners wonder whether there are tax differences between a demand-based and a consumption-based certificate. Short answer: No, for tax purposes there are no differences. Both types are treated the same — whether you rent, sell or use commercially.

The only difference is cost: A consumption-based certificate typically costs €100–300, a demand-based one €300–1,500. As both are fully deductible (for rental/sale/commercial use), you save more tax with a more expensive demand-based certificate but also have higher outlay. The choice should be based mainly on legal requirements (more details: Demand-based certificate for residential buildings), not on tax savings.

Can energy certificate costs be passed on to tenants?

Many landlords ask whether they can pass energy certificate costs on to tenants. Short answer: Generally no. Energy certificate costs are generally not allocable as operating costs. The Operating Costs Ordinance (BetrKV) explicitly lists which costs are allocable. Energy certificate costs are not on that list. They are costs borne by the landlord as part of renting.

There are some exceptions: If a certificate is issued in connection with new rental, the costs may in some cases be treated as "costs of new rental". This is legally disputed and should be checked case by case. For professional management companies, energy certificate costs may in some cases be treated as management costs that can be allocated in part. This depends on the specific contract.

Practical tip: As energy certificate costs are tax-deductible (as income-related expenses), net cost to the landlord is lower anyway:

Net cost is so low that passing it on to tenants (where possible at all) is often not worth it — and could even cause tenant dissatisfaction.

Documents for the tax office

To deduct energy certificate costs you need certain documents. The invoice must include: name and address of issuer, type of certificate, date of issue, property address, total cost and for §35a EStG a separate breakdown of labour and material costs.

You need proof of non-cash payment (bank statement, direct debit confirmation or card receipt). Cash receipts are not accepted.

For §35a EStG you should document the on-site visit: date and time, name of energy expert, confirmation of visit, optionally photos or notes. Other important evidence: the certificate registration number (if any), validity period (10 years) and optionally correspondence with the expert. Keep all documents for at least 10 years, as the tax office can request them in an audit.

Avoid common mistakes

Many owners make mistakes when deducting energy certificate costs. The most common misconception is that all energy certificate costs are automatically tax-deductible. The reality:

Practical tips for the tax return

If you want to declare energy certificate costs in your tax return, it is important to enter them in the right place. The right schedule depends on your situation.

It is advisable to consult a tax adviser: in complex situations (several properties, different uses), for §35a EStG (if you are unsure whether conditions are met), if the tax office refuses, for commercial use with complex structures or in an audit. A tax adviser can help you find the right schedule, enter the correct amounts, object if refused and maximise tax savings.

Conclusion: Energy certificate costs tax-deductible

Tax deductibility of energy certificate costs is complex — but with the right knowledge you can save real money. Summary of the main points:

Your next steps: Identify your scenario (rental, sale, commercial or private use), gather the required documents (invoice, payment proof, tenancy/purchase contract if applicable), choose the right schedule (V, G or SO), enter the costs (total cost for rental/sale/commercial, 20% of labour costs for §35a EStG) and keep all evidence for at least 10 years.

Tax deductibility is only one way to save costs. Do not forget: use cheap online certificates (more: Buy energy certificate online: 3 top providers compared), ask about free provision by broker or bank, do not neglect quality (faulty certificates can cost more) and consider costs in relation to property value.

More tips on saving costs: Energy certificate free: how to avoid costs. And if you want to know what changes are discussed or planned for energy certificates from 2026: Energy certificate 2026: New A–G scale and extended duties. If you want to order your certificate directly: Create energy certificate online.

Sometimes a cheap online certificate that is not deductible is cheaper than a more expensive one with tax saving. Always work out both options before deciding. If in doubt, consult a tax adviser — especially in complex situations or if the tax office refuses your deduction. The cost of professional advice can pay for itself quickly.

Note: This article was produced in good faith. It does not replace advice from a qualified tax adviser. For specific questions about your tax situation you should always consult a tax adviser.