Property tax reform: 90,000 property tax returns still omitted

Half a year after the deadline, tens of thousands of property tax returns are still missing in Berlin. 783,000 property owners - about 90 percent - have submitted their declarations, as the tax authorities announced in response to a dpa request. Around 90,000 declarations are still missing.

"If no extension of the deadline has been granted in an individual case, anyone who has not submitted a declaration will face an assessment," said a spokeswoman for the tax administration on how to proceed. "In significant cases, penalty payments may be issued and assessed in order to obtain the submission of the declaration." It was further stated that the tax offices have so far sent out about 585,000 notices on property tax value. This concerns about three quarters of the declarations received.

The amount of the new property tax cannot yet be calculated

"At the moment, the amount of the new property tax cannot be calculated on the basis of the established property tax value," the spokeswoman explained. This is because the current assessment rate will cease to apply on 31 December 2024. Only when the majority of Berlin's properties have been revalued - i.e. at the end of 2023 or beginning of 2024 - can the so-called measurement amounts be checked and a new assessment rate determined. Only then will the amount of the new property tax be determined.

New calculation bases from 2025

Property tax is being reformed in Germany, and new calculation bases will apply from 2025. In order to prepare for the reform, land and property owners were required to submit property tax returns containing a wide range of information. The deadline for submission officially ended on 31 January. However, declarations continue to trickle in to the tax authorities. The declared political goal is that the nationwide reform called for by the Federal Constitutional Court a few years ago is "revenue neutral" - i.e. the state should not collect more property tax after the reform than before. However, since the value of real estate will be reassessed, it may be that property owners will have to pay more or less tax in individual cases from 2025 than before.

Berlin government wants to prevent higher taxation across the board

The CDU and SPD in Berlin have agreed in their coalition agreement: "We want to structure the regulatory scope of the property tax reform in such a way that a nationwide higher burden on tenants and owners is prevented. To this end, we will reduce the assessment rate with the aim of revenue neutrality from 2025 onwards." Landlords can pass on the property tax to their tenants via the service charges.