Denkmal-AfA is the most aggressive depreciation schedule in German tax law. On a listed (Denkmalschutz) building, the qualifying renovation costs can be written off at up to 9% per year for eight years, then 7% for four more.
How It Works
Two depreciation streams run in parallel. The regular AfA applies to the original building substance at 2% over fifty years. The Denkmal-AfA applies to the qualifying renovation costs (the Sanierungs-Anteil) at 9% per year for years 1 to 8, then 7% per year for years 9 to 12. After year twelve, the renovation costs are fully depreciated.
The Catch
- The Bescheinigung from the Denkmalbehörde must certify the qualifying costs, granted in the right sequence
- The math works best at high marginal tax rates (roughly 42%+) and over a 12-year-plus horizon
- Exit liquidity is thinner and the building carries ongoing Denkmalschutz constraints