If you own a rental property, you should be aware of your rights and responsibilities as a landlord. If the tenant makes a flat rate advance payment for the additional costs along with the monthly rent to be paid, the landlord must prepare an additional costs statement once a year. The billing must be correct and clear and only include additional costs, the allocation of which to the tenant is also agreed in the rental agreement.
If you are a landlord and have to deal with utility billing, you have to dig through several stacks of paper and then present the total costs incurred, broken down into individual utility cost items in a clear and comprehensible manner. If the additional costs are billed incorrectly, the tenant has the right to object. However, if you want to avoid ambiguities and disputes, you can do so based on formal, legal and calculation accuracyhave it checked by a specialist. This means that errors can be identified and corrected quickly. However, we have put together a few points below that should be taken into account.
What are additional costs?
The additional costs, also known as operating costs, are ongoing costs that are not incurred once but on a regular basis. These are costs that arise from the use of the building and the property. Repair costs or administration costs are not operating costs.
Which of the operating costs can the landlord pass on to his tenants?
Landlords can pass on certain expenses to their tenants, but only if this is agreed in the rental agreement. This is the so-called contribution agreement. The landlord does not have to cover additional costs without an agreement.
§ 2 of the Operating Costs Ordinance (BetrKV)includes all applicable additional costs. This includes:
- Property tax – ongoing public charges on the property
- Sewer fee – drainage of the property
- warm operating costs – heating, hot water
- Elevator
- Street cleaning and garbage collection
- Building cleaning and pest control – cleaning the stairwell, laundry room or elevator, eliminating moths, cockroaches or rats
- Garden maintenance
- Lighting costs – Electricity costs for outdoor lighting as well as for parts of the building shared by tenants, such as the laundry room, hallway or stairwell
- Building insurance, glass insurance and certain liability insurance
- Janitorial costs
- Television, antenna or cable connection
- Costs for operating a shared laundry room
- Other operating costs that are recorded in the rental agreement - for example cleaning the gutters, maintaining the smoke detectors or the extractor system
Expenses for repairs in the house or garden as well as the landlord's administrative costs cannot be allocated.
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No later than twelve months after the end of the billing period, the landlord is obliged to provide a list of the additional costs and advance payments actually incurred. The operating cost statement must be formally correct and easy for the tenant to understand.
What exactly does a utility bill include?
- Sender and addressee
- billing object
- billing period
- Creation date
- Cost type
- Compilation of the total costs
- Transfer key or distribution key
- Calculation of the tenant's share
- Deduction of the tenant's advance payments
What is the transfer key? It determines how the additional costs incurred are distributed among the tenants. As a rule, landlords can choose between 4 distribution keys: consumption, living space, number of people or housing unit. The landlord should decide which variant it should be right at the beginning of the tenancy and record it in the contract. If no distribution key is specified in the rental agreement, the additional costs must be allocated according to the proportion of living space, i.e. according to square meters.
When does the landlord have to prepare such a statement?
The additional costs must generally be billed once a year. As a rule, the landlord has to read the individual consumption. The billing period does not necessarily have to start with the calendar year, but it is recommended. It is important that 12 months are always included in the operating cost bill.
As soon as the utility bill is ready, you as the landlord should sign it personally and send it to the tenant. Twelve months after receiving the statement, the tenant has the right to lodge an objection and inspect the receipts from the landlord.
Utility billing represents a particular challenge for some landlords. If the necessary work seems too mathematically complicated and time-consuming, it's worth a quick check from an expert.
