Property tax: what real estate owners in Bavaria have to consider when filing their tax return

Created: 07/10/2022, 08:42

By: Matthew Schneider

The tax office in Bavaria is currently sending mail to millions of households.

In it, owners are asked to submit a declaration on the new property tax.

what to do now

Munich – The decades-old property tax system is unconstitutional – this was the decision of the highest German court in spring 2018.

Because the values ​​used are outdated.

Therefore, new systems for property tax are being set up throughout the republic.

The Free State has opted for a relatively uncomplicated one.

Essentially, owners only have to state their living, usable and floor space.

Lukas Hendricks, lecturer at the State Association of Tax Advisory and Auditing Professions in Bavaria, explains how this works.

New property tax: who has to file the tax return?

"The property tax return must be submitted by anyone who owned land or agricultural or forestry land on January 1, 2022," explains Lukas Hendricks.

A special case: "In the case of properties with heritable building rights, it is the persons entitled to heritable building rights with the participation of the property owners." In addition: "In the case of buildings on third-party land, the building owners submit a declaration for the built-up area and the property owners for the reason," says the tax consultant.

"The only exceptions are properties that are used by an association of persons for non-profit or charitable purposes, such as the sports field of a non-profit association."

When does the declaration have to be made in Bavaria?

"The declaration must be made between July 1 and October 31, 2022." The official Elster portal should be used for this.

“Anyone who does not have access can also submit the declaration on paper.

The templates are available either at www.grundsteuer.bayern.de, from the tax offices or from the municipality.

In principle, no receipts are required,” explains tax consultant Hendricks.

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How is the new property tax calculated?

"The new property tax is based on real estate, living space and other usable areas," explains Hendricks.

This data must be submitted to the tax office.

A Bavaria-wide uniform equivalence number per square meter is assigned to each area.

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Multiplied by the respective area (rounded down to full square meters), this results in the individual equivalent amount.

This is offset against the property tax index.

The result is the property tax amount.

Up to this point, the procedure is the same for all Bavarian properties.

“The community assessment rate is then different locally.

That's one factor by which the property tax rate is increased," explains Hendricks.

This results in the property tax.

The municipalities will decide on the assessment rates in 2024, and from 2025 the property tax will then be levied according to the new system.

CALCULATION OF THE NEW PROPERTY TAX:

Source: State Ministry of Finance and Homeland

How do owners determine the property data?

"A property tax lot includes all parts of an economic entity, even if they're on two lots, such as a single-family home with a garage," explains Hendricks.

The official size of a piece of land "can be determined either from notary contracts, the land register or the real estate cadastre," according to the tax consultant.

The latter is also available online: “The parcel size can be viewed free of charge at www.bayernatlas.de,” says Hendricks.

The offer is available from July 1st to October 31st, 2022.

How is living space determined?

The determination of the living space is based on the Living Space Ordinance.

"It can also be found in the construction documents, the rental agreement or the service charge statement," says Lukas Hendricks.

The living space also includes extensions such as conservatories or swimming pools.

"You can usually calculate the area yourself by measuring the spaces between the front edges of the cladding," says Hendricks.

“You don’t need an architect or surveyor for that.

A folding rule or a laser measuring device will also do.

You can buy them from around 20 euros.

Small inaccuracies are accepted by the financial administration"

Parts of the room from two meters high are to be fully evaluated and parts between one and two meters half.

This also applies to conservatories.

"Basements, pantries and boiler rooms are not considered at all in purely residential buildings," explains Hendricks (see table below).

Outbuildings in the immediate vicinity of the apartment are only recognized if they are larger than 30 square meters, garden houses not at all.

From July 1, 2022, land and property owners must submit their property tax return to the tax office.

© Jens Büttner/dpa

How is the usable area determined?

“The usable area of ​​office and commercial units includes tea kitchens, offices, workshops, warehouses and storage rooms.

"This does not include traffic areas such as corridors or ramps," says Hendricks.

What applies to garages and parking spaces?

"If the (underground) garage is in the immediate vicinity of the apartment, it is not used up to a size of 50 square meters," explains Hendricks.

If it does not belong to the same economic entity, it must be contractually assigned to the property in order to use the exemption.

"Pure ownership or renting is enough for this," says the tax consultant.

Outdoor parking spaces and carports, on the other hand, are not included at all.

Are there exceptions?

There are some discounts, for example for listed buildings or social housing.

However, because this can only be assessed individually, you should consult a tax advisor if in doubt.