1. Introduction

Owners of real estate in Germany pay an annual German property tax (Grundsteuer). In English, this is often called German real estate tax. It is a recurring charge based on the property’s assessed tax value and the local municipal multiplier. This guide explains how it’s calculated and what changed with the 2025 reform.

2. How German property tax is calculated

In simple terms, the tax is computed as:

Property tax value × basic federal rate (Steuermesszahl) × municipal multiplier (Hebesatz)

• Property tax value (Grundsteuerwert): assessed by the tax office based on statutory valuation rules.
• Basic federal rate: a small percentage set by federal law; it differs by property type.
• Municipal multiplier (Hebesatz): determined by each municipality; this is the biggest driver of local differences.

3. German property tax reform (from 2025) — brief overview

The property tax reform updates valuation rules nationwide from 2025. The federal law provides a standard (“federal model”), and some states use their own approved models. Municipalities will continue to set their Hebesatz to achieve target revenues, so liabilities can go up or down depending on location and property specifics. Owners received new assessments and municipalities are updating multipliers accordingly.

Practical takeaway: two neighboring cities can have noticeably different outcomes due to different municipal multipliers.

4. Who pays and when?

• Who: The registered owner of the property (at the relevant date) is liable for German property tax.
• Billing: The municipality issues notices and collects the tax, typically in quarterly installments.
• Tenants: In many rental situations, landlords can pass property tax on to tenants as part of operating costs (check your lease and local rules).

5. Notes for international owners

Non-resident owners are also subject to German property tax on German real estate. Keep your contact details up to date with the tax office and municipality, and review the municipal multiplier annually.

6. Need help with German property tax?

We assist international owners with calculations, assessments and appeals, and integrate German real estate tax into broader cross-border planning. Speak with our team to review your 2025 assessment and municipal multiplier.