Tax reduction for instalments only after full payment

Oct 30, 2025

The Federal Finance Court (BFH) has ruled that, following the implementation of energy efficiency measures, the property owner can only be granted the tax reduction for energy efficiency measures once the measure has been fully implemented and the invoice has been submitted and the invoice amount has been paid in full by bank transfer.

In the case in question, the taxpayers had a modern boiler installed and paid monthly instalments to the installation company over a period of several years. They wanted to claim the instalments paid in each year as an energy efficiency measure for tax purposes and be granted the tax reduction.

The Federal Fiscal Court rejected this on the grounds that completion of the measure was necessary for the tax reduction. However, the measure was only considered complete once the full invoice amount had been transferred.

It would only have been possible to claim the instalment payments annually as a limited tax reduction for tradesmen's services, but then only for the installation services and not for the material costs. Furthermore, once the tax reduction for tradesmen's services had been claimed for the first time, in this case for the installation of the boiler, it would not be possible to claim the tax reduction again for the same energy-related measure.

Source: BFH, judgment of 13 August 2024 – Ref. IX R 31/23