German property tax reform

If you own real estate in Germany, you need to act now!

Background
As early as 2018, the Federal Constitutional Court gave the legislature the task of re-regulating the valuation of real estate in connection with property tax. The background is the standard assessment, which is classified as unconstitutional and based on values from the 1960s (or in the new federal states from the 1930s). This can currently result in different taxation of properties that are actually of equal value.
With the reform of the property tax, the legislator wants to eliminate this inequality without changing the overall revenue generated by the property tax. For this purpose, the property value relevant for the property tax must be reassessed. From 2025, new property tax assessments are to be issued based on this. However, a new assessment based on January 1, 2022 data will be performed and an according declaration has to be filed before October 31, 2022

WHAT DOES THE NEW REGULATION MEAN FOR YOU?

By now you will have received a letter from the German tax authorities asking to submit a declaration to determine the property tax values electronically before October 31, 2022.(Note: Not all federal states will provide such a letter – reach out to us if you are not sure about your declaration obligations).
Different regulations apply to the valuation of undeveloped and developed land as well as special features for the respective type of use. In addition, different assessment procedures apply depending on the federal state.
The procedure to be used for the valuation of your property depends on the federal state in which the property is located.

HOW CAN WE HELP?

Using software and cloud-based collaboration tools, we have an efficient and streamlined process in place to prepare and submit your declaration of determination in a timely and correct manner. Depending on the federal state, your property is located in, we might need the following documents to prepare the declaration:

• Letter from the tax authorities
• Abstract of title (“Grundbuchauszug”)
• File number (“Einheitswert-Aktenzeichen”)
• Ownership structure
• Residential and commercial space
• Use of the property (e.g., home ownership, rental property, vacant / undeveloped lot)

Looking for assistance with filing your German income tax? We are happy to help. Our multilingual team, with extensive expertise in international taxation, is there to help you with your tax matters in Germany. Feel free to contact us. https://german-incometax.de

Feel free to reach out to grundsteuer@schlecht-partner.de with the address and ownership structure of your property and we will provide a list of documents and information required to prepare your property tax declaration before October 31, 2022. More informations: www.grundsteuererklaeren.de/en/