Property tax

For condominiums, the property tax value is first determined for the entire building or property and then allocated proportionally to the individual units according to the co-ownership share registered in the land register.

The party registered as owner in the land register on January 1 remains liable for property tax for the entire calendar year. A proportional apportionment between seller and buyer is usually regulated contractually in the purchase agreement.

In the case of a heritable building right (Erbbaurecht), it is generally the leaseholder, not the landowner, who is liable for property tax, since both the building and the use of the land are economically attributed to the leaseholder.

Yes, property tax is generally payable irrespective of actual use or any vacancy, as it is linked to ownership of the property rather than its use.

If the declaration of assessment is not submitted by the deadline, the tax office may estimate the property tax value and additionally impose late filing surcharges as well as coercive fines. A subsequent submission is nevertheless generally still possible.

For mixed-use properties, the property tax value is determined proportionally according to the respective usable areas for residential and commercial use, as different valuation parameters and, in some cases, different tax assessment rates apply to both types of use.

Yes, in the case of significant loss of income that is not self-inflicted, for example due to structural vacancy or damage from a disaster, a partial remission of property tax may be granted upon application pursuant to § 33 of the Grundsteuergesetz (Property Tax Act).

For listed buildings, the Grundsteuergesetz (Property Tax Act) provides for a remission of property tax under certain conditions due to increased maintenance costs, provided that these costs demonstrably exceed the achievable income.

After a demolition, this must be reported to the tax office, whereupon the property tax value is adjusted by way of an update to reflect the new use as an undeveloped plot of land, usually with noticeable effects on the amount of tax.

Property tax A (Grundsteuer A) applies to agricultural and forestry land, while property tax B (Grundsteuer B) applies to all other developed and undeveloped plots. Both categories follow different valuation rules and assessment rates.

A significant change of use must be reported to the tax office and generally leads to an update of the property tax value, as commercially used areas are sometimes subject to different valuation parameters than residential space.

Since properties are always clearly assigned to a municipality and thus to a federal state, there is no parallel application of two models. The model applicable is always that of the federal state in which the property is actually located.

The tax office issues a separate, proportional property tax value notice for each condominium unit within the community, based on the co-ownership share of the respective unit as registered in the land register.

In the event of proven temporary insolvency, the competent municipality may grant a deferral of property tax upon application, provided that the claim is not thereby jeopardized and adequate security is provided.

Both procedures must be considered separately from a legal standpoint, as different valuation bases apply. However, successfully demonstrating a lower value in one procedure can serve as supporting argumentation in the other procedure.

In the case of partial letting, the property tax value is determined uniformly for the entire building, taking into account both the owner-occupied and the let area, with proportional consideration of the respective use.

Agriculturally used land is subject to property tax A and is assessed according to its own, income-oriented valuation rules, which differ significantly from the valuation of building land under property tax B.

The property tax value is reassessed on a regular basis every seven years as part of a main assessment. In the event of material changes, for example due to new construction or demolition, an additional update is carried out outside this cycle.

The federal model calculates the property tax value based on value, using the standard land value (Bodenrichtwert) and rents. Several federal states, such as Bavaria, Baden-Württemberg, or Hamburg, instead use their own, mostly area-based state models with differing calculation methods.

The objection must be submitted in writing or electronically to the responsible tax office that issued the assessment notice. It should be specifically justified, ideally supported by a valuation report or verifiable errors in the details of the notice.

The objection period is one month from notification of the notice. If this deadline is missed, the notice becomes final and binding, and a later correction is only possible in very limited exceptional cases.

Similar to inheritance tax, the German Valuation Act also allows, under certain conditions, proof of a lower actual value for property tax purposes if the standardized property tax value significantly exceeds the actual market value.

With the reform, the assessment basis for property tax was redetermined nationwide in a more realistic manner. For many owners, the actual amount of tax changes noticeably, depending on location, the standard land value, and the levy rate set by the municipality.

For undeveloped land, the property tax value under the federal model is simply calculated as the land area multiplied by the official standard land value of the respective zone, without further individual adjustments.

The assessment rate (Hebesatz) is a percentage individually determined by each municipality, by which the property tax base amount is multiplied. It significantly determines the actual amount of property tax payable and varies greatly between municipalities.

Yes, property tax is among the apportionable operating costs and can generally be fully passed on by the landlord to the tenants via the utility bill, provided this is agreed accordingly in the lease.

If a property is developed during the ongoing assessment period, this must be reported to the tax office. A revaluation of the property tax value is then carried out as of the next reference date, taking the new building into account.

If the official standard land value appears excessive in an individual case, an appraisal report can be submitted showing a lower, individually substantiated fair market value in order to have the property tax value notice corrected accordingly.

Generally required are the property tax value notice, land register extract, site plan, building plans, as well as evidence of value-reducing particularities such as contamination, renovation backlog, or an unfavorable property layout.

Yes, municipalities can set their own, higher assessment rate – the so-called Grundsteuer C (land tax C) – for ready-to-build but undeveloped plots, in order to counteract speculation with building land and encourage prompt development.

Under the federal model, additional factors such as the number of apartments and a tendentially lower income multiplier affect multi-family houses, meaning the land tax value per square meter is often more favorable than for single-family houses.

Incorrect information can lead to an inaccurate property tax value notice and should be corrected as quickly as possible by filing an objection or a correction notice with the tax office in order to avoid lasting financial disadvantages.

In the case of minor deviations, the appraisal costs often exceed the possible annual tax savings. An appraisal report is generally only worthwhile from a significant value difference of several tens of thousands of euros.

The property tax value and the market value are two independent value figures with different purposes: the property tax value is determined on a standardized basis in accordance with the Valuation Act (Bewertungsgesetz) for property tax from 2025 onwards, while the market value reflects the price actually achievable on the market. Both values can differ considerably from one another.