Many property owners have now received their local property tax assessment and are shocked to find that the property tax payable from 2025 has increased many times over in some cases. How can this be and what options do property owners have? This article explains the most important aspects of the property tax reform with a focus on Bavaria.
Property tax reform: the new basis of assessment
The property tax reform has triggered a change in the property tax that every property and real estate owner in Germany pays. Until 2024, the standard value was the basis of assessment for property tax. In 2018, the Federal Constitutional Court ruled that this value was unconstitutional, making a property tax reform necessary. The basis for calculating property tax changed significantly as a result of this reform, and it also differs from one federal state to the next.
How is property tax calculated in Bavaria?
In Bavaria, the calculation is based exclusively on the size of the property and building. It is an area-based model that differs fundamentally from the previous, value-based calculation.
Initially, the responsible tax offices in Bavaria determined the property tax base amount in two notices based on the submitted property tax return.
The municipal authority then multiplies this property tax base amount by the individual assessment rate. This results in the property tax to be paid annually.
When is an appeal against the property tax assessment useful?
We often read in the press that an immediate objection should be made to the tax office’s assessments or an immediate appeal should be made against the municipal authorities’ assessments. Our assessment of this:
- We only consider an appeal against the equivalence number decision or the land tax assessment notice from the tax office to be expedient if there are errors in the content of the notices. This could be, for example, an incorrect area or a reduction that has not been taken into account.
- Similarly, an appeal against the local authority’s property tax assessment only makes sense if the property tax base amount has been incorrectly adopted or if there is some other error in the content.
- Constitutional concerns also appear to have been dispelled: in Bavaria, there was initially discussion of whether the area-based model could be constitutionally questionable. However, more recent court rulings confirm that there are most likely to be no constitutional objections to the Bavarian property tax law.
Hardship provisions: Possibilities of applying for remission
In principle, the only option available to the municipality is to apply for remission in certain hardship cases. As a rule, the legislator provides for two possibilities in this regard:
- In the case of rented (developed) properties, provided that the actual rent is more than 50% below the local rent and the landlord is not responsible for this reduction.
- In the event of an ‘unreasonably high tax burden’ due to the property tax reform, for example in the following cases:
– The location differs significantly from the local conditions in the municipality.
– The total useful life of the building has been exceeded.
– In the case of an oversized building not used for residential purposes, provided that it has simple furnishings and either has a hall section or is not used in the long term.
Important to know: In cases of an ‘unreasonably high tax burden’, the decision lies entirely at the discretion of the municipality and applies exclusively to Bavarian properties.
A corresponding application for remission must be submitted by 31 March of the following year at the latest. For the year 2025, the application period thus ends on 31 March 2026..
Conclusion and recommended action
The effects of the property tax reform are complex and differ from individual to individual. Those affected should carefully check their assessments and, if necessary, seek expert support to identify and claim possible grounds for remission.
Since the legal requirements for a full or partial exemption from property tax are extremely meagre and unclear, the success of an application depends heavily on the discretion of the local authorities. Due to the novelty of the regulations, there is currently no empirical data available. Whether and to what extent an application for exemption has a chance of success can therefore only be determined on a case-by-case basis by submitting a corresponding application to the local authority.
Would you like to commission a remission application?
We will be happy to help. Contact us at grundsteuer@acconsis.de
Your ACCONSIS contact

Andreas Jovanic
Tax consultant
Authorised signatory of ACCONSIS
Service phone
+49 89 547143
or via email
andreas.jovanic@acconsis.de