Niels Webersinn
by Niels Webersinn
nbs partners is a multidisciplinary association of certified public accountants, lawyers, and certified tax advisors with a focus on the audit and advisory of small, mid-size and large entities, as well as international groups and high net-worth individuals.
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As a result of the new real estate tax, 36 million economic units in Germany must be revalued in 2022 due to the decision of the German Constitutional Court on 10 April 2018, which declared the real estate tax valuation based on unit values no longer valid. The standard values as of 01 January 1935 (eastern Germany) and 01 January 1964 (western Germany) will lose their validity on 31 December 2024.
As of 01 January 2022, property tax values are to be determined separately for all economic units of real estate on the basis of the reformed property tax and valuation law (main determination). This includes agricultural and forestry enterprises as well as land. In order to implement this main assessment of real estate tax values, effective 01 July 2022, taxpayers must submit a declaration of assessment in accordance with the officially prescribed data set by remote data transmission. Based on the information in the assessment declaration, the tax office will determine the real estate tax value and issue a real estate tax value notice.
The previous procedure for determining the land tax remains unchanged:
real estate tax value x tax assessment figure x assessment rate = real estate tax
However, the real estate tax value is determined by the Tax Office based on a declaration of assessment. The tax rate is fixed by law and the assessment rate is determined by the local authorities.
The majority of the federal states are implementing the new property tax according to the federal model, which was introduced with the Real Estate Tax Reform Act. In the area of property tax A (agricultural and forestry assets/enterprises), most of the federal states implement the federal model. In the area of land tax B (real estate/land), the states of Saarland and Saxony deviate from the federal model only in the amount of the tax assessment figures. The states of Baden-Württemberg, Bavaria, Hamburg, Hessen and Lower Saxony, on the other hand, apply their own real estate tax model.
The declaration in 2022 is important, as the determination notice of the tax authorities will be the base for tax assessments within the next seven years.
Niels Webersinn is Director for international tax law, asset transfers and agricultural tax law at nbs partners in Hamburg. Niels Webersinn has lived in the USA and France for several years and is therefore familiar with the pitfalls of international tax regulations. He is married and has two kids. Contact Niels.