Authorities deducted taxes and charges from 20,000 Munich residents twice swelling the city coffers by an extra €4.7 million.
The city's council said it would correct the mistake as quickly as possible, the Süddeutsche newspaper reported.
City bosses said on Friday that they took the extra money off childcare fees and taxes.
Munich finance director Ernst Wolowicz said: "We will of course transfer the money back as quickly as possible."
The mistake was caused when the city's accounts system was updated.
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