Preliminary costs

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Initial costs are expenses associated with building your own home that are not part of the manufacturing or acquisition costs, but are related to the construction or purchase of your own home and are incurred before you move in. These preliminary costs can be deducted from taxes immediately and in full.

The initial costs also include the discount (“Damnum”). In contrast to the interest on debt, which is due after collection, it can be deducted from tax and reduces the taxable income by the corresponding amount.

That is why bank customers strive to agree as high a damnum as possible. The tax office usually recognizes a damnum of up to one percent per year of fixed interest rates.