Various legislative changes will take effect at the turn of the year. The Wohnen im Eigentum (WiE) consumer protection association provides an overview of the changes that matter to condominium owners and condominium owners’ associations, how they should be assessed and which deadlines must be met in 2025.
Income tax exemption for PV systems: permitted gross output doubled
The income tax exemption for small photovoltaic systems is being expanded. The following applies to systems purchased, commissioned or expanded after 31.12.2024: the gross output permitted for the tax exemption is being increased from 15 kilowatt-peak (kW peak) to 30 kW peak per residential or commercial unit. It is also being clarified that the tax exemption is an exemption threshold rather than an allowance. This means that if the threshold is exceeded, the full amount becomes taxable.
Smart meters mandatory in certain households
From 01.01.2025, metering point operators are required to install smart meters, or intelligent metering systems, in certain households. This applies to households with annual electricity consumption of more than 6,000 kilowatt-hours, households with a photovoltaic system whose installed capacity is between 7 and 100 kilowatts, and households with a controllable consumer device such as a heat pump, EV charging point or another device.
All other households will receive only a digital electricity meter. They can, however, also ask their metering point operator, generally the local grid operator, to install a smart meter. Smart meters regularly transmit electricity consumption data to electricity suppliers, grid operators and the metering point operator. From 2025, households with a smart meter must be offered dynamic electricity tariffs.
Consumption-based heating cost billing for heat pumps too
Since 01.10.2024, heating costs in blocks of flats supplied predominantly with heat, or with heat and hot water, from heat pumps must also be billed according to consumption, as is the case for oil, natural gas and district heating. This is required by the revised Heating Costs Ordinance. If users’ proportionate consumption had not yet been recorded by the cut-off date of 01.10.2024, a transitional period applies: building owners then have until 30.09.2025 to install suitable consumption-metering devices (Section 12(3) of the Heating Costs Ordinance). After that date, they must bill heating costs according to consumption.
Survey of the condition of individual heating systems
The Building Energy Act (GEG) requires condominium owners’ associations (WEGs) with individual heating systems to initiate a procedure to survey the condition of their heating systems by 31.12.2024. This measure is intended to prepare at an early stage for possible future replacements. Condominium owners’ associations with individual heating systems are legally required to request data from the district master chimney sweep’s register for each system by 31.12.2024. Relevant information includes the type, age, operational condition and rated thermal output of each system.
By the same date, the WEGs must also ask the respective owners directly for information about heating systems and equipment that form part of their individually owned property:
- the condition of their heating system (including whether it has broken down once or several times in the past),
- the number of radiators in the flat and whether they function properly,
- repairs carried out on the heating system,
- alterations made to the heating system, pipes or radiators.
Information about whether measures have been taken to improve efficiency, such as replacing radiator valves, is also important.
Reformed property tax
From 01.01.2025, the reformed property tax will be levied on the basis of the new rules and new municipal assessment rates. Property tax is calculated using 3 variables: property value (property tax value) x tax assessment figure x assessment rate.
E-invoicing requirement also applies to landlords
An amendment to the VAT Act provides for the introduction of electronic invoicing as part of the Growth Opportunities Act. The e-invoicing requirement takes effect in Germany on 01.01.2025 for businesses in the B2B sector. From 01.01.2025, all landlords, irrespective of whether their lettings are exempt from or subject to VAT, must also be able to receive, process and archive electronic invoices.
The obligation to issue e-invoices, by contrast, applies only to landlords who opt for VAT, meaning those who make VAT-liable lettings to other businesses (under Section 9 UStG). However, a transitional period continues until the end of 2026. Until then, paper or PDF invoices remain permitted, provided that the recipient has agreed.