Once a year it's due: the utility cost statement (Nebenkostenabrechnung). If you rent out a few flats privately in Germany, you gather bills from the utility company, insurer and caretaker and do the math in Excel. With a clear order of steps it goes faster, and the most common mistakes can be avoided.
The deadline: twelve months
The statement must reach the tenant no later than twelve months after the end of the billing period (Section 556(3) BGB). If the period ends on 31 December 2026, the statement must be with the tenant by 31 December 2027. If it arrives late, you can usually no longer claim an additional payment. You still have to pay out any credit due to the tenant.
Step 1: Collect all costs for the year
You may only pass on operating costs that are agreed in the tenancy agreement. The German Operating Costs Ordinance (Betriebskostenverordnung) lists, among others:
- Property tax
- Water and sewage
- Heating and hot water
- Lift
- Street cleaning and waste collection
- Building cleaning and pest control
- Garden maintenance
- Electricity for shared areas, such as the stairwell and cellar
- Chimney sweep
- Property and liability insurance for the building
- Caretaker
- Shared antenna or cable connection, where still permitted
- Laundry facilities
- Other operating costs, if explicitly named in the agreement
Not recoverable are, for example, administration costs, repairs and maintenance, bank charges and reserves.
Step 2: Choose the right allocation key
The allocation key determines how costs are split between the flats. Options include:
- Living space: the legal default if nothing else is agreed. Typical for property tax and insurance.
- Persons: often for water or waste if there is no meter. Important: anyone who wasn't there the whole year only counts proportionally by days.
- Units: the same amount per flat, for example for the cable connection.
- Consumption: by meter reading, for instance for water with flat meters.
For heating and hot water, the Heating Costs Ordinance applies: usually 50 to 70% must be billed by consumption. In addition, CO₂ costs are split between landlord and tenant according to a tiered model. This part is often supplied ready-made by the metering service.
Step 3: Account for tenant changes and vacancies
If a tenant moved in or out during the year, they only pay the costs for the days they lived there. As the landlord, you bear the costs for empty flats yourself. They may not be passed on to the other tenants.
Step 4: Deduct advance payments
From the tenant's share of costs, deduct the advance payments they actually made. Not the agreed ones, but the ones paid. That gives you the additional payment due or the credit.
Worked example
A building with 200 m² of living space; your tenant's flat is 60 m². Property tax is EUR 900 a year.
- Share by area: 60 m² / 200 m² = 30%
- Tenant's share of property tax: 30% of EUR 900 = EUR 270
- If the tenant only moved in on 1 April, only 275 of 365 days count: EUR 270 × 275 / 365 = EUR 203.42
Calculate each type of cost this way and add everything up at the end.
What the statement must contain
- Billing period
- Total costs for each type of cost
- The allocation key used, clearly explained
- The tenant's share for each type of cost
- The advance payments made
- The result: additional payment or credit
The tenant may inspect the receipts. Keep the bills in good order for that reason.
Common mistakes
- The statement arrives too late, and the additional payment is then usually lost
- Repairs or administration costs are passed on as well
- Vacancy costs are spread over the other tenants
- Persons are not counted by days even though someone moved in or out
- Agreed instead of actually paid advance payments are deducted
- The allocation key isn't stated in the statement
Frequently asked questions
By when does the tenant have to pay the additional amount?
The additional payment is usually due once a proper statement has been received. Many landlords set a payment term of about 30 days.
How long can the tenant raise objections?
Up to twelve months after receiving the statement.
Can I adjust the advance payments after the statement?
Yes, by a reasonable amount based on the last statement. This should be done in text form.
Do I have to send the statement by post?
Text form is enough, so email works too. What matters is that you can prove it arrived on time.
Preparing the statement clearly
Set up a simple table for each billing year: one row per type of cost, with the amount from the bill, the allocation key and the share for each flat. Enter move-ins and move-outs with their dates straight away, so the periods are right. Before sending, check the deadline once more and make sure you have deducted the advance payments actually made.
This article is general guidance for residential tenancies in Germany (as of October 2026) and is not legal advice. For questions about your tenancy agreement, landlord associations (Haus- und Grundbesitzervereine) or a lawyer can help.