Utility billing: facts and deadlines everyone should know

What are operating costs?

Operating costs are defined as ongoing costs incurred by the owner in owning or using the building, outbuildings, facilities and land for their intended purpose. These are therefore recurring and regular costs.

Tenants receive the operating cost statement once a year, depending on the start of their rental contract. There are a few minimum requirements to be observed so that the billing is formally correct - these include: statement of the billing period, compilation of the total costs, specification and explanation of the distribution key used, the tenant's share of the costs, deduction of the advance payments made by the tenant and the total of the repayment or additional payment . For a proper utility bill, landlords must send their tenant the bill no later than one year after the end of the billing period.

An example: With a billing period from January 1 to December 31, 2020, the tenant must receive the utility bill by December 31, 2021 at the latest. "The one-year period for the landlord also applies if the tenant has moved out in the meantime," says Matthias Klauser, Chief Revenue Officer at McMakler (www.mcmakler.de). And further: "The tenant has no right to ask the landlord to receive the bill earlier." In principle, the operating costs can be billed over a maximum period of twelve months.

What may be included in the utility bill?

In general, the landlord can pass many costs on to the tenants, provided this is agreed in the rental agreement. Not all items have to be mentioned in the rental agreement. Operating costs include all common, apportionable operating costs according to the catalog of the Operating Costs Ordinance. The landlord may pass on the following costs: property tax, insurance, building cleaning and garden maintenance, waste disposal, shared parts of the building and warm operating costs (costs for heating and hot water).

Other recoverable additional costs are the maintenance of smoke detectors, the waste water fee and any costs for antenna or cable connections. The landlord is responsible for the costs of maintenance and administration. The following costs can therefore not be passed on to the tenants: vacancy, administration costs, maintenance and repairs.

The costs for the caretaker can be passed on to the tenants. “However, repairs that are carried out by the caretaker must be deducted from the costs for the caretaker, as these may not be passed on to the tenant,” says Klauser von McMakler. In addition, the Federal Court of Justice (BGH) decided in a judgment of December 18, 2019 (Az: VIII ZR 62/19) that an emergency service flat rate paid to the caretaker is not a question of apportionable operating costs, but administrative costs to be borne by the landlord.

Deadline for subsequent payment by the tenant

If the utility bill was drawn up correctly and resulted in an additional payment by the tenant, the tenant must pay the outstanding amount within 30 days of receipt of the statement. “Individually, however, there is the possibility of agreeing to pay the claim in installments with the landlord. However, he is not obliged to accept payment in installments," says real estate expert Klauser.

Payment deadline for the tenant's credit

If the landlord misses the billing deadline, he can no longer make any additional claims. If the deadline is missed, this usually results in the complete ineffectiveness of the utility bill. Exceptions are only permitted if the landlord can prove that the delay was not his fault.

"The tenant, on the other hand, retains the right to a repayment of his credit balance if the actual, apportionable ancillary costs were lower than the advance payment made - even if he did not receive the statement on time," emphasizes Klauser. The landlord must repay the credit within 30 days - either by paying it out to the tenant's account or as a credit on the next utility bill.

Time limit for objection by the tenant

If the landlord has complied with the billing period, the tenant has one year to check the utility bill and, if necessary, to raise objections to the bill. The period begins at the end of the month in which the tenant received the statement. An example: The utility bill is received on March 12, 2021. The tenant has until March 31, 2022 to raise objections to the bill.

"The objection period has no influence on the due date for the ancillary costs. Tenants can point out possible mistakes and initially pay the subsequent claim with the reservation of reclaim or, in the case of a clear mistake, only pay the justified portion and submit the objection in writing and with reasons,” explains Klauser von McMakler.

Once the one-year period has expired, the tenant can no longer raise any objections and must accept the billing unchanged. In the present case (judgment of May 12, 2010, Az: VIII ZR 185/09), a tenant had lodged an objection to his utility bill in 2003 and 2004, since he was not obliged to do so due to the lack of an agreement to pay real estate tax. In 2005, the landlord passed the property tax on to the tenant again, but the latter no longer commented on this statement.

The BGH decided that the tenant had to pay the property tax for 2005 because he did not raise an objection in due time. The tenant argued that he had raised objections in previous years and that the landlord therefore knows that he is not prepared to pay the property tax. However, the judges ruled that the tenant must notify the landlord (again) within one year even if he has already raised objections to previous statements.

Conclusion

"So that tenants do not expect any nasty surprises after receiving the utility bill, they should find out enough about the regulations in their rental agreement and the utility cost ordinance. Appropriate measures can be taken in the event of errors in billing. It is important for landlords to comply with the deadlines and formal requirements of the utility bill. In any case, both parties should check the billing very carefully,” sums up Klauser von McMakler.