What an allocation key decides
An allocation key (Umlageschlüssel) decides how the service charges of a whole building are split across the individual units. This means the allocable operating costs under section 2 BetrKV (Betriebskosten), for example property tax, water, waste disposal, insurance and building cleaning.
Management costs, maintenance and repairs, and payments into the maintenance reserve are not included. Under section 1 (2) BetrKV they are not operating costs and cannot be passed on to tenants. Any allocation also requires that the lease provides for it (section 556 (1) BGB). The calculator assumes such an agreement.
How the calculator works
Each cost item is split on its own: the total is divided in the ratio of the unit's reference value to the sum of all reference values. The sum runs over all units in the building, including vacant and owner-occupied ones.
CIRO calculates in whole cents. Each share is rounded down, and the missing cents go one by one to the largest rounding remainders. That way all shares add up to the total costs to the cent. Only then are the items added up per unit. This keeps the statement verifiable (section 259 BGB).
If two shares have exactly the same rounding remainder, the larger share gets the cent; for equal shares, the unit listed first.
Share of the unit = cost of the item × reference value of the unit ÷ sum of the reference values of all units
Which keys exist and when they apply
- Living area: the statutory default if nothing else is agreed (section 556a (1) sentence 1 BGB). The actual area counts, not the one in the lease (BGH, VIII ZR 220/17).
- Consumption: required for costs recorded by consumption, such as cold water with unit meters (section 556a (1) sentence 2 BGB).
- Persons: common for waste or water without meters. The actual occupancy counts, not the population register (BGH, VIII ZR 82/07). If occupancy changes during the year, CIRO uses person-days.
- Units: the same share per unit, only if agreed.
- Co-ownership shares: the default for a let condominium without another agreement (section 556a (3) BGB), in a rental building only if agreed.
The suggestions in the calculator are keys common in practice. Section 2 BetrKV itself does not prescribe a key.
Worked example with vacancy
Building insurance costs €2,400.00 a year. The building has unit A with 70 m² (let), unit B with 50 m² (vacant) and unit C with 80 m² (let), 200 m² in total.
- Unit A: €2,400.00 × 70 ÷ 200 = €840.00
- Unit B: €2,400.00 × 50 ÷ 200 = €600.00, borne by you as the landlord
- Unit C: €2,400.00 × 80 ÷ 200 = €960.00
- Check: €840.00 + €600.00 + €960.00 = €2,400.00
It would be wrong to use only the let area of 150 m² as the denominator. Then A and C would pay €2,400.00 between them and cover the vacancy too.
The landlord bears vacancy and own use
When costs are split by living area, the landlord bears the costs of vacant units (BGH, VIII ZR 159/05). The vacant unit therefore stays in the denominator with its area. The same applies to a unit you use yourself.
With the persons key, a vacant unit would have 0 persons and the tenants would bear the costs in full. The Federal Court of Justice treats it as a question of fairness in the individual case whether you must contribute, e.g. depending on the length of the vacancy and the type of costs. A fictitious person can be counted for vacant periods (VIII ZR 180/12). CIRO therefore counts one person for vacant units by default; you can switch this off, e.g. for a short vacancy.
Let condominium: the association's key
Since 1 December 2020, a let condominium without another agreement uses the key by which the owners split costs among themselves, usually the co-ownership shares (section 556a (3) BGB). If that key is inequitable, living area applies again.
From the owners' association statement (Hausgeldabrechnung) you only take over the allocable items. That statement is not a service charge statement to your tenant. It contains the manager's fee and the maintenance reserve, which do not belong in the statement to the tenant.
The property tax of a condominium comes from your own assessment notice and belongs entirely to this unit. Do not split it by co-ownership shares.
In the calculator you either enter all units of the association, or only your own plus the association totals per key, such as total area and total consumption. CIRO shows the rest as the share of the other co-owners.
If the landlord splits costs from the owners' association statement, they need the total costs and the association total for each item, not just the values of their unit. Only then can the tenant follow the statement.
Common mistakes and limits of the calculator
- Leaving vacant units out of the denominator: the tenants then pay for the vacancy.
- Adding all costs first and splitting afterwards: with different keys, nobody can verify the result.
- Splitting heating costs by area: the HeizkostenV requires 50 to 70 % by consumption. Use the heating cost calculator for that.
- Changing the key mid-year: you may switch to consumption unilaterally in text form, but only before a billing period starts (section 556a (2) BGB).
- Commercial units in the building: a deduction in advance may be needed. The calculator does not cover this.
- Different keys in different leases of the same building: the calculator assumes one key per item for everyone.
- More than 20 units or 10 cost items: the calculator is not built for that. In the CIRO app you can bill whole buildings.