Advertising cost lump-sum calculation for room/apartment rental from 2006

The So far existing Lump sum in the seasonal private room rental at Farm (cf. Client information April 2005) has been modified from 2006 also on income from the commonly seasonal (Foreign-)room and apartment rental applicable. However, it should be noted that in the case of Long-term rental from apartments of the deduction of Standardized advertising costs is inadmissible.
Until now, only the qualification of the income, whether from rental or business operations, was dependent on the number of guest rooms (cf. Client Info June 2004). For more than 10 guest rooms, it was a commercial activity; for no more than 5 apartments without additional services, it was still a rental activity; and for 18 residential units, it was an asset management activity.

The 2nd EStR Maintenance Decree 2006 included the Conditions for the generalized Withdrawal of Advertising costs from 2006 as set out below:

:: Room or apartment rental with breakfast Rz 5435 EStR

At no more than 10 foreign beds can Advertising expenses at the height of 50% of the proceeds (excluding VAT and local tax) are deductible. The local tax is considered a pass-through item. When applying the gross method, the paid VAT and the pre-tax profit from capital investments are separately deductible.

:: Apartment rental without additional services Rz 5436 EStR

At no more than 5 apartments can Advertising expenses at the height of 30% of the proceeds VAT, tourist tax and input tax deductions apply as described above.

:: Change in rental at the farm starting in 2006 Rz. 4193 EStR

Until 2005 were the side income from the rental of up to 5 extra beds as part of the Lump sum income from agricultural activity treated. At 6 to 10 beds could 50% the rental income as expenses are claimed and claimed by more than 10 beds layers business income forward.
From 2006, the 5-bed rule will no longer apply.. For up to 10 beds, the expenditure is calculated based on 50% of the revenue; for more than 10 beds, as before, it is commercial income.

Image: © Anna Blau - BMF