Analysis: More than a million missing property tax returns in Germany

Analysis: More than a million missing property tax returns in Germany

According to a report by www.tagesspiegel.de, more than a million property tax returns are still missing in Germany. Most federal states have already extended the submission deadline because the required declarations were not received on time. In Lower Saxony and Baden-Württemberg, around 250,000 declarations are missing, in Brandenburg around 150,000 and in Bavaria only 300,000 of the 6.5 million declarations required. However, North Rhine-Westphalia has reported that around 94 percent of the declarations have already been received by the tax offices. Nevertheless, in some federal states several million reminder letters were sent to defaulting owners.

The introduction of the new property tax calculation from 2025 has already begun, although not all declarations have been received yet. According to the Federal Ministry of Finance, around 36 million properties in Germany need to be revalued, which represents an enormous logistical challenge. Nevertheless, millions of new property tax assessment notices have already been sent out by the tax offices. However, the actual amount of property tax depends on the assessment rates set by the cities and municipalities.

These delays in property tax returns could impact the real estate market. In particular, uncertainty about the future level of property taxes could have an impact on the planning of property owners and investors and influence property prices. In addition, municipalities that rely on property taxes could face financial shortfalls if the new calculations are not completed on time.

However, the property tax reform could also have positive effects, especially in Berlin, where the assessment rate could be reduced. A reduction in the assessment rate could lead to lower taxes for owners and thus increase the attractiveness of owning real estate in the capital.

Overall, it remains to be seen how the delays in property tax returns and the introduction of the new calculation will affect the real estate market in Germany. However, it is clear that the timely clarification of these issues is crucial to ensure the stability of the real estate market and the financial situation of municipalities.