Property tax; payment to the municipality

What is property tax payable on?

The following are subject to property tax

• Agricultural and forestry businesses (property tax A) and
• Land, e.g. single-family houses, condominiums, commercial properties (property tax B).

Property tax is a property tax, i.e. property tax must be paid for every agricultural and forestry business and every plot of land in Germany. The personal circumstances of the owner are not taken into account when determining the tax base.

Who has to pay property tax?

Property tax must be paid by the owner of the agricultural and forestry business or the owner of the property. If the agricultural and forestry business or the property belongs to several persons, companies or communities, they owe the property tax jointly.

If the property is rented out, the property tax can be passed on to the tenant as part of the operating costs.

If the owner changes because the agricultural and forestry business or the property has been sold, given away or inherited, the new owner must pay the property tax from January 1 of the following year. For the year in which the ownership of the property has changed, the old owner must still pay the property tax. The old and new owners can agree among themselves that the costs will be borne by the new owner. This does not have to be reported to the tax office or the municipality. The municipality itself may not demand the property tax for this calendar year from the new owner, but must still approach the previous taxpayers for this.

- 300 percent property tax A (agricultural and forestry property)

- 425 percent property tax B (other real estate)

The tax is determined in a three-stage process.

until 2024:
The basis for the tax calculation is solely the value of the agricultural and forestry business or the property (assessed value). However, the value ratios as of January 1, 1964 are decisive here. The assessed values are only used as a basis for property tax up to and including 2024.
(see "Property tax until 2024; receipt of the assessment notice on the assessed value and the property tax assessment amount" under "Related topics")

from 2025:
From 2025, the basis for the tax calculation for property tax A is the capitalized earnings value of the agricultural and forestry business. For property tax B, the areas of the parcels of land and the buildings as well as the use of the buildings are decisive.
(see "Property tax from 2025; receipt of the notice on the property tax value or the property tax equivalent amounts and the property tax assessment amount" under "Related topics")

The responsible municipality sets the property tax after the assessment of the assessed value (until 2024) or the equivalent amounts/the property tax value (from 2025) and the determination of the property tax assessment amount by the responsible tax office. The property tax assessment amount communicated by the tax office is multiplied by the assessment rate that the municipality has set in advance in its statutes. The municipality is free to set its own assessment rate.

The property tax can be waived in certain cases. The application for remission must be submitted to the municipality.

You can lodge an objection/appeal or file a lawsuit.

A separate assessment is issued for the assessed value or the equivalent amounts/the property tax value, the property tax assessment amount and the property tax, which can be contested separately with an appeal.

However, an appeal against the property tax assessment cannot be based on the fact that one of the other assessments is incorrect. These are purely basic assessments for the property tax assessment and are therefore binding for the municipality. If the basic assessment notices are changed, the municipality will adjust the property tax ex officio.

The objection to the property tax assessment notice cannot be based on the fact that the notice on the assessed value or the equivalent amounts/the property tax value is incorrect.

For further information - in particular the deadline within which an appeal must be lodged and to which authority it must be addressed - please refer to the information on legal remedies contained in the notices.