Side cost may only be requested to be reimbursed by the tenant - the landlord is not allowed any kind of margin on top of the actual cost.
But what are side cost?
Sure - we are in Germany, so there is a law for it, the Betriebskostenverordnung. Actually, there are two. The Heizkostenverordnung also applies.
The first one is a sweet and short regulation consisting of two articles only.
Article 1 deals with the general definition of the so-called "Betriebskosten" as well as the counter-definition of what is not to be considered "Betriebskosten".
- The definition says that operating cost are all running cost of the landlord caused by the ownership of the property. Services rendered by the landlord himself can be deducted with the comparable amount. VAT is not to be applied.
- No operating cost are cost related to administering the property (tax accounting, managing, marketing) as well as maintaining and repair cost.
Article 2 gives a detailed list of explicite, non-exclusive, operating cost
- Property tax
- Water supply
- Operation of the central heating and exhaust system
- Operation of the central hot water supply system
- Associated heating and hot water supply systems
- Operation of a passenger or freight elevator
- Building cleaning and pest control
- Garden Care
- Lighting costs for outdoor lighting, staircase and corridors
- Chimney Cleaning
- Property & Casualty Insurance
- Using a master antenna system
- Operation of facilities for the laundry care
Lump sum versus lump sum
You are probably paying a monthly lump sum to the landlord covering the presumed operating cost. However, the wording in your contract is the decisive criteria whether or not the landlord has to make a year end claculation or not.
If your contract says "Nebenkostenpauschale" then he is not obliged. This kind of wording is common for interim accommodation, especially for furnished apartments. It means that both tenant and landlord agree upfront on the amount of the operating cost the landlord is entitles to charge. The risk is on both sides, however, it is certainly higher on the tenant's, since the landlord usually knows pretty well how much a usual tenant will consume throughout a month. The wording may be a bit misleading, as the word "Pauschale" may not be sufficient to define the agreed procedure. In case of doubt, ie. in case the landlord suddently presents you an invoice to cover outstanding operation cost, it is wise to consult a lawyer unless the amount is minimal.
If your agreement says "Nebenkostenvorauszahung" the landlord will do a year end calculation. He collects all the invoices, applies a comparable price for his own work (where applicable), applies any relevant allocation rule (ie. by m², by entity, by counter status) and calculates the actual cost. He has to provide the calculation to you and you can even request to see the underlying invoices. Usual, a specialised supplier is rendering the service (the cost for this service is not considered operating cost!).
The landlord has to perform the calculation of actual operting cost once every 12 months. Since this period is not necessarily identical with the calendar year it is worth asking for the period throughout the negotiations of the agreement. Is the period longer the tenant does not have to pay any requested over-consumption until he is provided with a correct period calculation. Shorter periods are allowed.
The landlord is granted another 12 months time to provide the calculation sheet. The reason is that some invoice come only very late or even after year end.
Example: you moved into a furnished apartment on 01.06. and you are moving out on 31.07. of the same year. Advance Payment of operating cost has been agreed. Calculation period is the calendar year.The landlord is obliged to provide a calculation for two months until latest 31.12. of the next year. And since he is entitled to hold back parts of your deposit for outstanding payments he may do so until 31.12. of the next year. It is very seldom however, that a landlord insistes on this right - and it is also subject to interpretation as the deposit has to be repaid within "reasonable" time. Ie. had the landlord received all invoices in March of the next year he is not entitled to keep the deposit any longer.
Due payments have to be made within 30 days after the claculation sheet is provided - that applies to both, the landlord and the tenant. Exception: the tenant claims incorrectness of the calculation.
Notwithstanding the above, the tenant can claim incorrectness within a period of 12 months after receipt.
if no specific allocation rule is agreed in your contract, any operating cost will be allocated by m². In most cases, several allocation keys will be agreed. Anything heating related is regulated by the Heizkostenverordnung. Anything else is pretty much a decision of the landlord. However, since he is responsible to provide a correct calculation it is in his own interest that - in case of several tenants - the split among tenants is fair. If it is not, the tenant can request recalculation.
Apart form allocation by counter the most common allocation key is in fact the number m², even though you may feel the number of people may be more just. However, allocation keys based on the numbe rof people would require the landlord to check the number of people living in his apartments - and that has nothing to do with the number of people being registered for the apartments.
Some cost are typically allocated by entities, ie. waste disposal cost, cable TV or cost for a satelite dish.
Combinations are allowed.