FAQ Property tax reform

Property tax is levied on real estate. This applies to land as well as buildings and agricultural and forestry operations. In principle, owners are responsible for payment. However, if the property is rented out, the property tax can be transferred to the tenant in accordance with the applicable civil law regulations for operating costs.

The revenue from property tax exclusively benefits the cities and municipalities. In 2023, Erlangen collected 21.6 million euros from property tax. As a fixed source of income, the funds from property tax are necessary to finance facilities such as schools, daycare centers, swimming pools and libraries. In addition, important investments can be made in local infrastructure such as roads, cycle paths and bridges.

The Federal Constitutional Court has classified the previous basis for calculating property tax, the standard values, as unconstitutional, as the values are outdated and landowners are therefore treated unequally. The old law may only be applied until December 31, 2024.

The property tax reform will take effect on January 1, 2025. The City of Erlangen's current property tax rate statutes dated November 28, 2019 will expire at the end of December 31, 2024. Without the enactment of a new property tax rate statute, there would be no legal basis for levying property tax from January 1, 2025, as the levying of property tax based on the old law is constitutionally prohibited.

It receives the data from the tax office. Most of the data is transmitted electronically. In some cases, however, the city also receives paper copies of the assessment notices.

At the time the assessment rate was determined in mid-September 2024, the city of Erlangen had received approx. 93% of the assessment notices for 2025. On October 31, 2024, approx. 95.6% of the assessment notices for 2025 were available.

Triggered by the current extremely tight budget situation, the new assessment rate is intended to bring revenues back closer to the 2019 level. The total revenue for property tax B amounted to €24.6 million in 2019 before the rate was reduced from 500% to 425%. However, in order not to place too great a burden on property owners, the city council decided at its meeting on November 4, 2024 not to raise the total revenue from property tax B completely, but only approximately to the 2019 level.

The increase in Erlangen is made up as follows: 100 percentage points of the increase are accounted for by a revenue-neutral assessment rate, which secures the tax revenue in 2024, as the reform will reduce the total amount of assessed values. A further 65 percentage points take into account the city's tight budget situation as well as uncertainties resulting from the reform (including new waivers, incomplete data bases, appeal proceedings at the tax office).

Due to the structure of the property tax reform, some properties will be transferred from property tax A to property tax B, which will significantly reduce the number of properties subject to property tax A. If the new property tax assessment rate for property tax A were calculated on a revenue-neutral basis for 2024, it would more than double compared to the current assessment rate of 300%. In order to avoid placing too great a burden on the properties remaining in property tax A while still reflecting the increase proportionately, an assessment rate of 425% was chosen at the city council meeting on November 4, 2024.

With the property tax reform, there is a change in Bavaria from a value-based calculation based on the assessed value to a purely area-based calculation based on the equivalent amounts or property tax values. This change in the calculation model will inevitably lead to a change in the measured amounts and therefore also in the property tax payable. For some landowners, this means higher property tax than in 2024, for others lower.

No. Property tax B is a purely area-based calculation model in which the value of the land and any buildings do not play a role. The construction method or year of construction of the buildings also play no role. Buildings under monument protection and social housing have already been taken into account by the tax office with reductions when calculating the amount to be measured.

It is currently planned that the property tax notices will be sent to landowners in mid-January.

The new property tax must be paid from 2025. It is set as an annual amount. As a rule, one quarter of this amount is due on February 15, May 15, August 15 and November 15.

You can find more information here

The simplest option is to issue a SEPA mandate, i.e. a direct debit. A SEPA mandate that has already been issued also applies to the new property tax from 2025. Standing orders are not recommended because the payment amount changes regularly due to the sewer, waste, street cleaning and discharge fees set in the property tax assessment notice.

Here: find out more

If you have general questions about the property tax reform, you are welcome to consult the website www.grundsteuer.bayern.de.

If you have any questions regarding the calculation of the property tax assessment amount, please contact the Erlangen tax office directly; the contact details can be found on your assessment notice.

If you have any questions about the property tax assessment notice itself, you can contact the City of Erlangen, Municipal Tax Department. You can do this by

• write an e-mail to grundsteuer@stadt.erlangen.de
• call the telephone number given in the property tax assessment notice.