Real Estate Tax Savings: What Entrepreneurs Really Need to Know

Saving taxes through real estate is one of the most powerful strategies available to entrepreneurs in Germany – and at the same time one of the most underestimated. Jonas Brüdern, tax advisor and founder of a modern firm, explained to me in a podcast conversation why so many entrepreneurs leave tax potential on the table, why real estate is almost unrivaled from a tax perspective, and what proactive tax planning sets apart from the typical accounting firm.

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Do Entrepreneurs in Germany Pay Too Much Tax?

The first question I asked Jonas was one that I myself had been thinking about for a while. His answer was honest: Yes, probably.

„There's actually potential everywhere to get a little more out of it. You just have to recognise it and then make use of it.“ – Jonas Brüdern

What surprised me wasn't the statement itself. You hear that fairly often. It was the example Jonas used to illustrate it: A property sale is tax-free after 10 years. Someone who sells just one week too early pays around 400,000 Euro in tax on a million-euro gain – simply because nobody pointed it out in time.

This isn't an exceptional case. It happens. And this is exactly where it becomes clear why proactive tax advice makes such a difference.

Saving Taxes with Real Estate: An Overview of the Tax Levers

Anyone looking to save taxes with real estate has several levers available simultaneously – unlike almost any other asset class.

The short version: Anyone who privately purchases a property can deduct interest, depreciation (AfA) and renovation costs from rental income. In many cases, this creates tax losses that can be offset against other income. After a holding period of 10 years, the sale is completely tax-free.

Jonas put it this way:

„Du kannst alle Kosten absetzen und hinten raus die Wertsteigerung steuerfrei mitnehmen. Das gibt es in keiner anderen Assetklasse.“ – Jonas Brüdern

The Most Important Tax Advantages of Private Real Estate

• Deducting interest: Third-party capital interest on the property loan directly reduces taxable rental income.
• Depreciation (AfA): Buildings are depreciated over 50 years (2% p. a.), which reduces the tax burden annually.
• Renovation costs: Maintenance expenses can be deducted immediately or spread over several years.
• Loss offsetting: If a loss arises after deducting all costs, it can be offset against other income – such as income from self-employment.
• Tax-free sale: After a holding period of 10 years, no income tax is levied on the capital gain.

Saving taxes on a severance payment through real estate

A particularly relevant case: saving taxes on a severance payment through real estate. Anyone who receives a large one-time payment can quickly find themselves in the top tax bracket in the year it is received. One way to reduce the tax burden is to strategically generate deductible expenses through real estate investments in the same year.

Specifically: if you purchase a property in the year you receive your severance payment and incur high renovation costs, these can be deducted immediately as maintenance expenses, significantly reducing your taxable income. The so-called Fünftelregelung (one-fifth rule) offers additional flexibility – but should be planned in advance with a specialized tax advisor, not applied retrospectively.

Tax planning: The service many business owners don't know about

This was one of the strongest points in the conversation for me. Jonas used a term I hadn't come across before: tax planning. I have to be honest – I had no idea that this even existed as an explicit service offering.

„Many firms limit themselves to dealing with the past. Last month's bookkeeping, last year's tax return. Forward-looking planning is far too rarely offered proactively.“ – Jonas Brüdern

According to Jonas, this comes down to two sides:

• The business owner often doesn't know that tax planning exists, and doesn't ask about it either.
• The tax advisor is so caught up in day-to-day operations that there's no time left for proactive planning advice.

My take on this: It's essentially a classic marketing problem. A service exists, but it's neither communicated nor actively offered.

When does tax planning with real estate pay off?

I asked Jonas directly at what point it makes sense as a self-employed person to think about structures. He didn't give a specific number – but what he said instead I found considerably more helpful:

„It pays off when you're making more profit than you need for your personal living expenses. Anyone who consumes everything directly will inevitably end up in the high income tax bracket.“ – Jonas Brüdern

The core point: In Germany there are two tax systems.

1. Income tax for everything you consume privately – which can quickly reach 42 percent.
2. Corporate tax at around 15 percent, when profits are retained and reinvested within a GmbH.

Anyone who has profit left over and wants to invest can build up considerably more capital through this lever. The compound interest effect with a lower tax burden over many years makes the decisive difference.

Real Estate in a GmbH: When Does It Pay Off?

Important to note: A GmbH does not benefit from the 10-year privilege. Anyone considering placing real estate into such a structure should run the numbers carefully beforehand.

The answer, as is so often the case in tax law, is: it depends. Anyone planning to save taxes with real estate over the long term should have both scenarios calculated in detail – ideally with a tax advisor who specialises in tax structuring.

Concrete tax planning with real estate: The 5 most important strategies

If you want to save taxes with real estate, there is more than one way to do it. Here are the five strategies that Jonas and I discussed in our conversation:

1. Consistently adhering to the 10-year rule

If you sell a privately held property after more than 10 years, the entire capital gain is tax-free. Selling just one week too early can trigger six-figure tax liabilities. This deadline should be marked on your calendar – long before any sale is being planned.

2. Offsetting losses against other income

Especially in the first few years after purchase, interest payments and depreciation frequently exceed rental income. The resulting losses can be offset against income from self-employment or business activities – which reduces the tax burden immediately.

3. Strategically managing renovation costs

Maintenance expenses up to 4.000 euros net can be deducted immediately. Larger projects can be spread over two to five years. Anyone who deliberately carries out renovations in a year of high income (such as a severance payment) can significantly reduce their tax burden.

4. Making use of family models

Properties can be rented to family members, provided the rent amounts to at least 66 percent of the standard local comparable rent. This allows income to be shifted to individuals with a lower tax rate.

5. Choosing the right structure

Anyone who owns multiple properties or plans to build up a larger portfolio should consider whether an asset-managing GmbH or a holding structure makes sense. Important: For private properties intended for sale after 10 years, keeping assets in private ownership usually remains the more attractive option.

How Jonas built his law firm with marketing

This is where the conversation became really interesting for me as a marketing consultant. Jonas founded his law firm at the end of 2024 and from the very beginning committed to daily content.

„We post every day. A reel or an image-text post. The machine is running.“ – Jonas Brüdern

What impressed me: this isn't chaotic, random posting. There's a marketing manager who handles everything in a structured way. Reels are filmed in batches, YouTube videos are planned strategically – on a single shoot day, ten or more videos are produced at once.

Content Recycling and AI: The Smart Approach Behind Jonas' Marketing

This was the most technically fascinating part of the conversation. Jonas doesn't simply use YouTube videos as videos. He recycles the transcripts for blog posts, social media posts, and ideas for additional reels.

The advantage here isn't just saving time. It's about quality assurance:

„What I say in the videos is technically accurate. That's why I can hand it over to the AI for further processing. When I instruct the AI directly, the output is often factually incorrect. That's dangerously bad for our brand.“ – Jonas Brüdern

Jonas and his team are also currently building their own AI knowledge database – all transcripts, blog posts, and explainer videos are fed into it. The goal: an internal AI assistant trained on the firm's specific expertise.

Tax consulting and AI: Those who are prepared now will win

„Classic bookkeeping will eventually run automatically. There will be price pressure. Those who are already more efficient now will have better margins and more time for real consulting during the transition period.“ – Jonas Brüdern

The firms that today rely on AI-supported processes and high-quality tax planning advice will still be relevant tomorrow. Employees who only type in bookings will no longer be doing that in 10 years. Employees who can set up AI systems, review results, and actively advise clients on saving taxes through real estate will be in demand like never before.

My Key Takeaways

• Saving taxes with real estate works – but only if the strategy is right. The 10-year rule is non-negotiable.
• Tax structuring exists as an option. Most entrepreneurs don't know about it. Ask your tax advisor about it proactively.
• Structures only pay off when you earn more than you spend personally.
• Holding real estate privately has tax advantages that are not available through a GmbH – in particular, the tax-free sale.
• AI needs good inputs. Those who have technically accurate source material can use AI effectively.

Conclusion: Saving Taxes on Real Estate Requires Strategy, Not Luck

Jonas Brüdern thinks like a media entrepreneur and advises like a strategist. The conversation made it clearer to me that saving taxes on real estate is not a matter of chance – it requires planning, the right advisor, and the knowledge of which questions to ask in the first place.

If you feel like you could still get more out of your tax situation, the most important action you can take today is this: actively ask your tax advisor about tax structuring advice. Not about your next tax return – but about what you can optimize going forward.

You can find the podcast episode here: YouTube: Behind the Scenes in Marketing, Episode 17

FAQ: Saving Taxes with Real Estate

How can I save taxes with real estate?
Privately held properties offer several levers at once: interest, depreciation (AfA) and renovation costs reduce taxable rental income. If losses occur, these can be offset against other income. After a holding period of 10 years, the sale is completely tax-free – a privilege that no other asset class offers.

Can I save taxes on a severance payment through real estate?
Yes, that is possible. Anyone who strategically incurs renovation costs on a property in the year of a large severance payment can claim these as immediately deductible maintenance expenses, thereby significantly reducing taxable income. Forward-looking planning with a specialized tax advisor is crucial in this regard.

Is tax planning with real estate held in a GmbH worthwhile?
Not as a blanket statement. A GmbH has the major disadvantage that the tax-free sale after 10 years does not apply. However, profits can be reinvested at the lower corporate tax rate (approx. 15%). The right decision depends on the holding strategy, the profit potential and the individual situation – always have it calculated on a case-by-case basis.

From what point does tax planning become worthwhile for entrepreneurs?
According to Jonas Brüdern, when you are generating more profit than you spend privately. Anyone who immediately consumes every euro will inevitably end up paying income tax. Those who want to reinvest can take advantage of the significantly lower corporate tax rate through structures such as a GmbH, thereby building substantially more capital over the long term.

What is the difference between tax advice and tax planning?
Traditional tax advice deals with the past – bookkeeping, annual financial statements, tax returns. Tax planning is forward-looking: it structures transactions and investments in such a way that tax burdens are minimized legally and proactively. Many entrepreneurs are unaware that this service exists – and therefore never think to ask for it.

How do I find a tax advisor who specializes in saving taxes with real estate?
Jonas recommends two approaches: firstly, personal recommendations from your own network, and secondly, platforms such as smartexperts.de, where you can filter by specialization and reviews. The key is to actively ask your advisor about tax planning advice – not just your tax return.