GmbH Depreciation in Germany 2026: AfA Rules, Immediate Write-offs and Tax Strategies
How GmbH and UG companies handle depreciation under German tax law – from linear and declining-balance AfA to immediate write-offs for low-value assets and practical tax strategies.
- Category
- Bookkeeping
- Updated
- Author
- Diana
When a GmbH or UG buys a laptop, machinery, or office equipment, it usually can't deduct the full cost in the year of purchase. German tax law requires higher-value assets to be written off gradually over their useful life – a process called AfA (Absetzung für Abnutzung, or depreciation). Used strategically, depreciation is one of the most powerful tools for reducing your GmbH's tax burden.
Key Points at a Glance
- Threshold: Assets above €800 net must be capitalized and depreciated over their useful life. Assets up to €800 net can be written off immediately in the year of purchase (low-value assets / GWG).
- Computers & software: Useful life of 1 year – effectively an immediate write-off, regardless of price (BMF ruling from 2021).
- Two methods: linear AfA (equal amounts) or declining-balance AfA (up to 30%, i.e. 3× the linear rate) for movable assets acquired between 1 July 2025 and 31 December 2027.
- Before you buy: The investment deduction (IAB) lets you deduct up to 50% of planned costs in advance (§ 7g EStG).
- Mandatory: Every GmbH maintains an asset register (Anlagenspiegel) as part of its annual accounts.
What Is AfA and When Must a GmbH Capitalize?
The basic rule: assets with a net purchase price above €800 must be capitalized (shown as fixed assets on the balance sheet) and depreciated over their ordinary useful life. Only the annual depreciation amount reduces profit – not the full purchase price in the year of acquisition.
The Federal Ministry of Finance sets useful lives in its AfA tables. They cover thousands of asset types and are effectively binding:
| Asset | Useful life | Linear AfA rate |
|---|---|---|
| Computer, laptop, software | 1 year | 100% |
| Smartphone | 5 years | 20% |
| Car / company vehicle | 6 years | ~16.7% |
| Machinery | 5–15 years | depends on type |
| Office furniture | 13 years | ~7.7% |
The most important special case: computer hardware and software may be depreciated over a useful life of just one year since the BMF ruling of 26 February 2021. A €1,500 net laptop is therefore fully deductible in the year of purchase – even though it exceeds the €800 GWG threshold.
Linear vs. Declining-Balance Depreciation
For capitalized assets you can choose between two methods.
The linear method is the standard: acquisition cost divided equally across the useful life. Example: a €6,000 server with a 3-year life → €2,000 per year.
The declining-balance method for movable assets was topped up again under the investment stimulus programme ("Investitionsbooster"). For assets acquired between 1 July 2025 and 31 December 2027, the rate is up to 30% – at most three times the linear rate (§ 7 Para. 2 EStG). It applies to the remaining book value each year, producing markedly higher write-offs early on. You can switch to linear at any time, which pays off once the linear amount would be higher.
The advantage is clear with a €30,000 machine over a 10-year life (linear rate 10%, so declining-balance 30%):
| Year | Linear (10%) | Declining balance (30%) | Remaining book value |
|---|---|---|---|
| 1 | €3,000 | €9,000 | €21,000 |
| 2 | €3,000 | €6,300 | €14,700 |
| 3 | €3,000 | €4,410 | €10,290 |
Over the first three years the declining-balance method writes off €19,710 instead of €9,000 – liquidity and tax deferral that matter most in high-profit years.
Low-Value Assets up to €800 and the Pooling Entry
Independently usable assets up to €800 net can be written off immediately in the year of purchase as low-value assets (GWG) under § 6 Para. 2 EStG. Alternatively, you can bundle assets between €250 and €1,000 into a pooling entry (Sammelposten) depreciated evenly over 5 years (§ 6 Para. 2a EStG). The two methods are mutually exclusive per fiscal year – you must pick one.
Which threshold applies to which case, and when the pool still makes sense despite the 1-year rule for computers, is covered in the detailed article on the GWG threshold and immediate write-off.
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Investment Deduction (IAB): Deduct Before You Buy
Under § 7g EStG, your GmbH can deduct up to 50% of the planned acquisition cost of a future asset before purchasing it – the investment deduction (IAB). Total outstanding IABs cannot exceed €200,000, and the investment must actually happen within 3 years, otherwise the deduction is reversed retroactively.
It's especially valuable in a high-profit year: you reduce taxable profit today and pay less corporate and trade tax, even though the purchase comes later. How to reverse, combine and check the conditions for it is explained in the guide to the investment deduction.
Recording Depreciation in Your GmbH's Books
In your GmbH's bookkeeping, depreciation is posted as an expense (account 6020 under SKR03), reducing annual profit and tax liability. Every GmbH must also keep an asset register and derive from it an asset schedule (Anlagenspiegel) as part of its annual financial statements. It documents acquisition cost, additions, disposals, and cumulative plus annual depreciation for each asset.
A special case with its own rules is the company car in a GmbH: it is depreciated over 6 years, and the non-cash benefit of private use must be taxed at the same time.
Frequently Asked Questions
What can a GmbH depreciate?
All depreciable fixed assets: computers, machinery, vehicles, office furniture, business equipment. Land and financial investments are not depreciable. Assets up to €800 net are written off immediately, more expensive ones over their useful life.
How long do you depreciate a computer in a GmbH?
Since the BMF ruling of 2021, computer hardware and software have a useful life of just one year. A laptop, PC, or monitor is therefore effectively fully deductible in the year of purchase – even above the €800 GWG threshold.
What is the difference between linear and declining-balance AfA?
Linear AfA writes off the same amount each year. Declining-balance AfA writes off a fixed percentage (up to 30% in 2026) of the remaining book value – the amounts are higher in the early years and fall over time. The declining-balance method applies only to movable assets acquired between 1 July 2025 and 31 December 2027.
Up to what amount can a GmbH write off immediately?
Up to €800 net per asset as a low-value asset (GWG). Computers and software count as effectively immediate write-offs regardless of price because of the 1-year useful life.
What is an Anlagenspiegel?
An overview of all a GmbH's fixed assets showing acquisition costs, additions and disposals, plus cumulative and annual depreciation. It is a mandatory part of the annual financial statements and is derived from the ongoing asset register.
Conclusion
Depreciation rules aren't just compliance – they're a genuine tax planning lever. Knowing the GWG threshold and the 1-year rule for computers, using declining-balance AfA at up to 30% correctly, and applying the IAB can meaningfully reduce your GmbH's annual tax bill. Norman records your acquisitions automatically, calculates AfA across the useful life, maintains the asset register, and prepares your GmbH tax return based on complete bookkeeping data.
Depreciation on autopilot, not in Excel
Norman records every asset your GmbH buys, calculates AfA across its useful life and maintains the asset register for your annual accounts – without looking up a single AfA table.