Feststellungserklärung for jointly owned rental property
In the case of jointly owned rental property, a Feststellungserklärung may be required in addition to the individual income tax return. When does this obligation arise, and how should the declaration be included in the Pacht service?
1. When should Feststellungserklärung be filed
Definition A Feststellungserklärung is a tax declaration required when income is jointly earned by multiple persons.
Instead of taxing the income directly, the tax office:
- determines the total income generated (e.g. rental income), and
- allocates this income to each individual based on their ownership share.
The result is issued in a Feststellungsbescheid, and each person must include their allocated share in their individual Einkommensteuererklärung (e.g. in Anlage V).
The obligation to file a Feststellungserklärung is based on § 180 Abgabenordnung (AO) – Separate and uniform determination of tax bases. According to § 180 Abs. 1 Nr. 2 AO: tax bases must be determined separately and uniformly when they are relevant for multiple taxpayers.
This applies in particular to:
- jointly owned rental property,
- partnerships,
- communities of heirs (Erbengemeinschaft).
Exception: According to § 180 Abs. 3 AO: Feststellung is not required if it is not necessary for taxation purposes.This is the reason why in some Pacht cases the Finanzamt does not require Feststellung.
2. Whether Feststellung should be included in the Pacht service
At the moment:
- the Pacht service includes only the individual Einkommensteuererklärung,
- rental income is declared in Anlage V,
- feststellung is not included proactively.
In some cases:
- the Finanzamt later requests Feststellung,
- the case must be reopened,
- additional work is required outside the original scope.
3. Service option proposal
- Option A – Add-on: Feststellung only when requested.
- Option B – Conditional inclusion (recommended): Include Feststellung only when likely required.
Proposed rule
Include Feststellung when:
1. property has 2+ owners ands at least one applies:
- different Finanzämter,
- no joint assessment,
- more than 2 owners,
- separate Steuernummer.
2. Do not include when:
- married couple,
- joint tax return,
- same Finanzamt,
- simple case.
Service structure
1. Base Pacht service
- Einkommensteuer,
- Anlage V.
2. Feststellung
- included (if required),
- or add-on (if unclear / requested later).
4. Pricing
- Option A – Fixed add-on price.
- Option B – Variable price.
- Option C – Included in Pacht price.
Suggested pricing
- Simple case (2 owners): €150 – €250.
- Complex case (3+ owners / special cases): €250 – €400.
5. Chronological order (Feststellung vs Einkommensteuer)
In cases where Feststellung is clearly required, the correct process should follow this order: First, the Feststellungserklärung is prepared and submitted to the Finanzamt. After processing, the Finanzamt issues a Feststellungsbescheid, which defines how the income is allocated between the owners. Only after this step should the individual Einkommensteuererklärungen be prepared, using the values determined in the Feststellungsbescheid (e.g. in Anlage V).
Currently, in most Pacht cases, the workflow is reversed. The individual Einkommensteuererklärungen are submitted first, and the rental income is declared directly in Anlage V without a prior Feststellung. In many cases, this is accepted by the Finanzamt. However, in some situations, the tax office later identifies that a separate determination is required and sends a request for a Feststellungserklärung after the Einkommensteuerbescheid has already been issued.
6. Standard process (when Feststellung is required)
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