Production costs: tax law, building & real estate

Production costs – Production costs are a valuation standard for manufactured assets and economic goods that have been produced in whole or in part in the company’s own operations. These are not only costs for the production of an object, but also the costs for its expansion and improvement. Production costs are therefore all costs incurred in the construction of a property, such as craftsmen’s work. Production costs can be depreciated for tax purposes on a straight-line basis, which allows the costs to be spread evenly over the useful life provided for by the law.

Cost of production at a glance

• Valuation standard for manufactured assets and economic goods
• Includes not only costs for its production, but also for its expansion and improvement
• All costs incurred in the construction of a property (including craftsmen’s work)
• Can be depreciated on a straight-line basis for tax purposes

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