Raise the car and support safely, drain the differential oil, remove the exhaust system, and disconnect and support the rear driveshaft; support the rear differential with BMW special tools 33 5 200 and 33 5 206 or a suitable workshop jack, remove the front differential mounting bolts and the rear mounting bolt and carefully lower the unit; use BMW special tools or an equivalent pry tool to free the left drive axle from the differential (axles retained by internal snap rings; prying force required), for N20/N26 use tool 2 240 465 and for N55 use tool 33 5 124, lower the differential while tilting the right side upward so the left axle can be removed, then free and remove the right drive axle using the same pry procedure and tools; with the left drive axle removed, move the differential to the left to remove the right axle, check sealing plate for damage and replace if needed, replace snap ring (8) on the differential output flange shaft and coat output flange shaft (C) with differential oil where it contacts the shaft seal; install new output shaft seals on both sides, the protection ring on the seal protects the seal lips during axle installation and is removed once the axle is installed, position the differential with a jack, slide left and right axle shafts into the differential and pull out the protection rings until they break away, push the output flanges fully into the differential until the flange splines engage and the snap ring snaps into place, install mounting bolts (A and B) finger tight and replace nuts and bolts, remove the workshop jack supporting the differential, tighten both front mounting bolts and the rear mounting bolt (8), complete the remaining installation in reverse order of removal, and check the differential oil level.