Second home tax: what you should know and how to avoid it

Second home tax in Germany can become an expensive proposition if you own a second property or need another residence for work reasons. But what exactly is this tax and are there ways to avoid it?

The second home tax is a municipal tax on people who own or rent a second home in addition to their primary home. The amount of this tax varies from city to city and can be up to 16% of the net cold rent.

There are several ways to avoid the second home tax:

  • Change main residence: If your center of life is actually at your secondary residence, you can make it your primary residence.
  • Subletting an apartment: If you sublet the second home, this can provide tax relief.
  • Temporary Living: An alternative is temporary living, where you rent an apartment or hotel room for a specific period of time.

Want to learn more about how you can avoid the second home tax through Temporary Housing?

myflexhome-avoid-second-housing-tax
myflexhome-avoid-second-housing-tax

Temporary housing offers an effective solution for people who need housing for a limited period of time without registering a permanent second home. This can be particularly relevant for work-related stays, project assignments or longer vacation stays in a city. Here are some points that make temporary housing particularly attractive in terms of the second home tax:

  1. No registration as a secondary residence: In the case of a temporary residential relationship, there is usually no obligation to register the accommodation as a secondary residence. This eliminates the potential second home tax.
  2. Flexibility: Temporary housing makes it possible to react quickly to changing life circumstances. When a project ends or there is no longer a need for housing, the temporary housing relationship can simply be terminated, with no long-term lease obligations.
  3. Furnished Accommodations: Many temporary housing listings include furnished accommodations. This not only saves moving costs, but also the effort of furnishing.
  4. Tax benefits: Under certain circumstances, the costs of temporary housing can be claimed as income-related expenses in the tax return, especially if the reason for the stay is of a professional nature.
  5. Transparency: The cost of temporary housing is often all-inclusive, meaning that in addition to rent, it includes utilities, Wi-Fi, and sometimes even cleaning services. As a result, there are no hidden costs.
  6. Less bureaucracy: Without the need to register a secondary residence and possibly pay secondary residence tax, a considerable amount of bureaucracy is eliminated.

In conclusion, temporary housing offers an efficient way to avoid the second home tax while remaining flexible and unattached. Those who change locations frequently for work reasons or simply want to live in another city for a while without making a long-term commitment should consider this option.