Every year, millions of tenants in Germany receive an envelope that causes confusion and sometimes frustration: the Nebenkostenabrechnung. This annual utility bill statement reconciles what you paid in monthly installments against what was actually spent on operating costs for your apartment. Understanding this document is essential for every renter in Germany, yet many tenants (including Germans) find it confusing.

This guide explains exactly what the Nebenkostenabrechnung is, what costs it covers, how to read it properly, and what to do if you think the numbers are wrong.

What are Nebenkosten?

Nebenkosten, often translated as "additional costs" or "operating costs," are the expenses associated with running and maintaining a rental property beyond the basic rent. They include things like heating, water, garbage collection, building cleaning, and property taxes.

When you rent an apartment in Germany, you typically see two rent figures: the Kaltmiete (cold rent, which is just the base rent for the apartment) and the Warmmiete (warm rent, which includes the Nebenkosten). The difference between these two numbers is your monthly Nebenkosten prepayment.

These monthly payments are estimates. Your landlord calculates them based on previous years' costs and the size of your apartment. At the end of each billing period, usually a calendar year, the landlord totals up the actual costs and compares them to what you paid. The Nebenkostenabrechnung is this annual reconciliation.

What costs are typically included in Nebenkosten

The Betriebskostenverordnung (Operating Costs Regulation) defines which costs landlords can legally pass on to tenants. Understanding these categories helps you evaluate whether your bill is reasonable.

Heating costs (Heizkosten) are usually the largest component. This includes the fuel or energy used to heat the building and the maintenance of the heating system. German law requires that at least 50% of heating costs be distributed based on actual consumption (measured by devices on your radiators), with the remainder split by apartment size.

Water and wastewater (Wasser und Abwasser) covers both the fresh water supplied to the building and the sewage processing fees. Some buildings have individual water meters for each apartment, while others distribute costs by number of residents or apartment size.

Garbage collection (Müllabfuhr) fees are set by the municipality and cover regular trash pickup and recycling services.

Property tax (Grundsteuer) is paid by the landlord but legally passed through to tenants proportionally based on apartment size.

Building insurance (Gebäudeversicherung) covers fire, water damage, storms, and sometimes liability. This is different from your personal renter's insurance.

Building cleaning (Hausreinigung) includes cleaning of stairwells, hallways, and common areas, whether done by a hired service or the building's Hausmeister.

Garden maintenance (Gartenpflege) applies if the building has outdoor spaces. This covers lawn care, tree trimming, and maintaining shared green areas.

Chimney sweep (Schornsteinfeger) services are mandatory in Germany and cover inspection and cleaning of heating systems and chimneys.

Elevator costs (Aufzugskosten) include electricity, maintenance, and regular safety inspections if your building has an elevator.

Street cleaning and winter services (Straßenreinigung und Winterdienst) cover municipal street cleaning fees and snow removal on sidewalks adjacent to the property.

Building superintendent (Hausmeister) costs cover the salary and supplies for a Hausmeister if the building employs one. Their duties typically include minor repairs, cleaning supervision, and general building maintenance.

What is NOT included in Nebenkosten

Certain costs cannot be passed to tenants and should never appear on your Nebenkostenabrechnung.

Electricity for your apartment is almost never included. You sign a separate contract with an electricity provider and pay them directly. The only exception is if your rental contract explicitly states that electricity is included, which is rare in long-term rentals.

Internet and cable TV are also separate contracts you arrange yourself. Some older contracts included a basic cable fee in Nebenkosten, but this practice is declining.

Repairs and maintenance beyond regular upkeep are the landlord's responsibility. The distinction: replacing a worn-out heating system is not a Nebenkosten item, but the annual maintenance check of a working system is.

Administrative costs for managing the property cannot be charged to tenants. The landlord's time spent creating the Nebenkostenabrechnung, for example, is not billable.

Vacancy costs for empty apartments in the building cannot be redistributed to occupied units. If three of ten apartments are empty, those three apartments' share of costs remains the landlord's problem.

Understanding your monthly Nebenkosten prepayment

When you sign a rental contract, the landlord sets a monthly Vorauszahlung (prepayment) for Nebenkosten. This appears in your contract as either part of the Warmmiete or as a separate line item.

A reasonable Nebenkosten estimate for an average apartment is roughly 2 to 4 euros per square meter, depending on the building's age, efficiency, and location. An 80-square-meter apartment might have monthly Nebenkosten of 160 to 320 euros.

If the prepayment seems unusually low, be cautious. Some landlords intentionally underestimate Nebenkosten to make listings appear cheaper, then hit tenants with large Nachzahlung demands later. If a listing shows a 50-square-meter apartment with only 50 euros monthly Nebenkosten, that is likely unrealistic and you should budget for more.

For more on how Warmmiete and Kaltmiete work together, see our guide on Warmmiete vs Kaltmiete differences.

When the Nebenkostenabrechnung arrives

Landlords must deliver the Nebenkostenabrechnung within 12 months after the billing period ends. For a billing period covering January to December 2025, the landlord has until December 31, 2026 to send you the statement.

If the landlord misses this deadline, you cannot be charged for any Nachzahlung. The landlord forfeits the right to collect additional money. However, you can still receive a Guthaben (credit) if you overpaid, even from a late statement.

This deadline is strict. If your statement arrives on January 2 for the previous year's costs, the landlord is too late and you owe nothing extra regardless of the calculations inside.

How to read the Nebenkostenabrechnung

The Nebenkostenabrechnung can be multiple pages long, but it follows a standard structure. Understanding each section helps you verify accuracy.

The billing period (Abrechnungszeitraum) specifies which dates the statement covers. This is usually a calendar year but can be different if you moved in mid-year.

Total costs for the building (Gesamtkosten) lists every cost category and the total amount spent on the entire building. This section shows what the landlord actually paid for heating, water, garbage collection, and other services.

Your share of costs (Ihr Anteil) shows how the total building costs were allocated to your apartment. The distribution method varies by cost type: heating is usually split by consumption plus floor space, water by consumption or number of residents, and property tax by apartment size.

Total you owe (Gesamtbetrag) sums up all your allocated costs for the year.

Your prepayments (Ihre Vorauszahlungen) shows how much you already paid through monthly Nebenkosten contributions.

The final result is either a Nachzahlung (additional payment you owe) or a Guthaben (credit coming back to you). If your prepayments exceeded actual costs, you receive money back. If actual costs exceeded prepayments, you owe the difference.

Nachzahlung vs Guthaben

A Nachzahlung means you owe additional money beyond what you already paid. This happens when actual costs exceeded your monthly prepayments. You typically have 30 days to pay after receiving the statement, though reasonable landlords may allow more time for large amounts.

A Guthaben means you overpaid and are entitled to a refund. The landlord should either transfer this amount to you or credit it against future rent payments.

If your Nachzahlung is substantial, the landlord may also increase your monthly prepayment for the following year to prevent a similar shortfall. This increase should be reasonable based on the actual cost development.

Checking your Nebenkostenabrechnung for errors

Studies suggest that over half of all Nebenkostenabrechnungen contain errors, often in the landlord's favor. Checking carefully can save you money.

Verify the billing period matches your tenancy. If you moved in on June 1, you should only be charged for costs from June through December, not the full year.

Check that only legally allowed costs are included. Administrative fees, repairs beyond routine maintenance, and landlord profit should not appear.

Verify the distribution key makes sense. If costs are distributed by apartment size, check that your apartment's size matches the contract. If distributed by consumption, ensure your meter readings are accurate.

Compare with previous years. Significant jumps in specific categories deserve explanation. If heating costs doubled but the winter was mild, ask why.

Request supporting documents. You have the legal right to review invoices and receipts underlying the Nebenkostenabrechnung. Ask to see the actual bills from utility companies, service providers, and contractors.

Check the math. Add up the numbers yourself. Calculation errors happen more often than you might expect.

How to dispute errors

If you find errors or have questions, act within 12 months of receiving the statement. After this period, you lose the right to dispute.

Start by writing to your landlord with specific objections. Identify exactly which line items you are questioning and why. Request copies of relevant invoices if you have not reviewed them.

For complex disputes or if the landlord is unresponsive, a tenant association (Mieterverein) can help. For a modest membership fee, they review your Nebenkostenabrechnung and communicate with your landlord on your behalf. Many errors are resolved once the landlord realizes the tenant is informed and persistent.

If the landlord refuses to correct clear errors, you can reduce your Nachzahlung by the disputed amount while the matter is resolved. Document everything in writing so you have evidence if the dispute escalates.

For landlords: creating the Nebenkostenabrechnung

If you are a landlord, creating an accurate Nebenkostenabrechnung is a legal obligation. The statement must be transparent, mathematically correct, and delivered on time.

Keep organized records throughout the year. Save every invoice related to operating costs: utility bills, service contracts, municipal fee notices, and insurance premiums.

Use a clear format that tenants can follow. List each cost category separately, show the total building cost, explain the distribution method, calculate each tenant's share, and compare against prepayments.

Consider property management software to automate calculations and ensure consistency. Our guide on property management software for landlords covers options that include Nebenkostenabrechnung features.

Deliver the statement well before the 12-month deadline. Mailing it on the last possible day risks missing the deadline due to postal delays.

Understanding cost distribution methods

German law prescribes different distribution methods for different cost types.

Heating and hot water must be distributed partly by consumption (at least 50%, up to 70%) and partly by apartment size. This rule ensures that energy-efficient behavior is rewarded while acknowledging that some heating costs are fixed.

Cold water can be distributed by consumption if individual meters exist, or by number of residents or apartment size if not.

Other operating costs are typically distributed by apartment size (square meters) or by number of units. The specific method should be stated in your rental contract.

The distribution key appears in your Nebenkostenabrechnung as a fraction or percentage showing your apartment's share of the building total.

What your rental contract says about Nebenkosten

Your Mietvertrag (rental contract) defines which Nebenkosten you are responsible for. Look for a section listing operating costs or referencing the Betriebskostenverordnung.

If a cost type is not mentioned in your contract, the landlord cannot charge you for it later. The contract should also specify whether you pay a flat rate (Pauschale) or a prepayment with annual reconciliation (Vorauszahlung).

A Pauschale means you pay a fixed amount regardless of actual costs. The landlord takes the risk if costs are higher than expected, but also keeps any surplus if costs are lower. With a Pauschale, there is no Nebenkostenabrechnung because the amount is fixed.

A Vorauszahlung is the more common arrangement where you pay estimated monthly amounts and receive an annual Nebenkostenabrechnung to settle the difference.

Connection to your rights as a tenant

Understanding Nebenkosten is part of knowing your tenant rights in Germany. You have the right to transparent billing, the right to review supporting documents, and the right to dispute errors.

The Kaution (security deposit) is separate from Nebenkosten. Your deposit cannot be used by the landlord to cover ongoing operating costs. It is reserved for damages and unpaid rent at the end of your tenancy.

Summary

The Nebenkostenabrechnung reconciles your monthly utility prepayments against actual operating costs once per year. You may owe a Nachzahlung if costs exceeded prepayments, or receive a Guthaben if you overpaid.

Check your statement carefully for errors. Verify that only legal costs are included, the billing period matches your tenancy, and the distribution calculations are correct. You have 12 months to dispute errors after receiving the statement.

Understanding your Nebenkosten helps you budget accurately and ensures you pay only what you legally owe.