Setting up tilemap for a top-down game

Is it possible to setup the tilemap to work with a top-down game well?

What I mean is that if the character is above a tile, it should be behind it, if it’s below the tile, it should be in front of it.

Right now a solution for this would probably to have a separate layer for each row of a tilemap and add an appropiate offset on the z axis for each layer, but I think this would break autotiling and I’m not sure about the performance consequences.

Separate layers/tilemaps. Then assign the layers/tilemaps to different Sorting Layers.
The example project has two scenes that do it this way. TileMapExample01 and 02.

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