Service charge statements for landlords: the most common mistakes

The annual service charge statement – legally the operating cost statement (Betriebskostenabrechnung) – is the most tedious duty for many private landlords in Germany. At the same time it is error-prone: even formal defects can mean that back payments cannot be enforced.

Mistake 1: Missing the deadline

The statement must reach the tenant no later than twelve months after the end of the billing period. For calendar year 2025, that means by 31 December 2026. What matters is receipt by the tenant, not the date of dispatch. After the deadline, back payments are generally excluded, whereas credits owed to the tenant must still be paid.

Mistake 2: Charging costs that were not agreed

Only operating costs effectively agreed in the tenancy agreement may be passed on. A reference to the Operating Costs Ordinance (BetrKV) is generally sufficient. Costs not listed there must be expressly named in the contract.

Mistake 3: Passing on management and maintenance costs

Management costs, repairs, maintenance, bank charges and reserves are not operating costs and may not be passed on to tenants. Caretaker invoices need particular care: if the caretaker also carries out repairs or administrative tasks, that share must be deducted.

Mistake 4: Wrong or unclear allocation key

Unless otherwise agreed, operating costs are allocated by living area. Under the Heating Costs Ordinance, heating and hot water costs must be billed predominantly according to consumption – usually 50 to 70 percent by consumption. The key used must be recognisable in the statement.

Mistake 5: Missing minimum formal information

A statement must show the total costs per cost type, the allocation key, the calculation of the tenant's share and the deduction of advance payments made. If any of these elements is missing, the statement may be formally invalid.

Mistake 6: Passing on the owners' association statement unchanged

Landlords of condominiums often simply pass on the owners' association's service charge statement. However, it also contains non-recoverable items such as the manager's fee and the maintenance reserve, and often uses different allocation keys. It must be transferred into a separate operating cost statement.

Mistake 7: Allocating vacancy costs to other tenants

The landlord bears the costs for vacant apartments. They may not be passed on to the remaining tenants.

Mistake 8: Not keeping receipts ready

Tenants have the right to inspect the original receipts. Keep invoices, contracts and meter readings in order. Transparent access to receipts prevents disputes.

Tip: adjust advance payments

If the statement results in a significant back payment, the monthly advance payments can be adjusted to an appropriate level. This protects both sides from high one-off amounts the following year.

Statements prepared by your manager

As part of our rental management, we prepare the operating cost statement on time and check whether each item can be passed on. You receive a clear statement that also stands up to scrutiny by the tenant.