Glossary
Grunderwerbsteuer
Grunderwerbsteuer: Grunderwerbsteuer (German for 'land acquisition tax', i.e. real estate transfer tax) is a one-time tax due when you buy a property or plot of land in Germany. Depending on the federal state (Bundesland), it runs from 3.5% to 6.5% of the purchase price.
What is Grunderwerbsteuer (real estate transfer tax)?
Grunderwerbsteuer (literally "land acquisition tax") is the German real estate transfer tax, also called the property transfer tax. It is a one-time tax that falls due when you buy a plot of land or a property in Germany. It belongs to the Kaufnebenkosten (closing costs) and is usually the single largest item among them. The tax is levied by the federal state (Bundesland) where the property sits.
Unlike the annual Grundsteuer (property tax), the Grunderwerbsteuer is charged only once, at the time of purchase. Since the 2006 federalism reform, the federal states have been allowed to set their own rate. Rates have diverged sharply since then: Bayern (Bavaria) stays at 3.5%, while Brandenburg, Nordrhein-Westfalen, Saarland and Schleswig-Holstein each charge 6.5%.
The tax is calculated on the purchase price agreed in the notarial purchase contract. If the buyer takes on additional consideration (for example existing charges on the property), that goes into the tax base as well.
Tax rates by federal state (as of 2026)
| Federal state | Tax rate |
|---|---|
| Baden-Württemberg | 5.0% |
| Bayern | 3.5% |
| Berlin | 6.0% |
| Brandenburg | 6.5% |
| Bremen | 5.5% |
| Hamburg | 5.5% |
| Hessen | 6.0% |
| Mecklenburg-Vorpommern | 6.0% |
| Niedersachsen | 5.0% |
| Nordrhein-Westfalen | 6.5% |
| Rheinland-Pfalz | 5.0% |
| Saarland | 6.5% |
| Sachsen | 5.5% |
| Sachsen-Anhalt | 5.0% |
| Schleswig-Holstein | 6.5% |
| Thüringen | 5.0% |
Calculating Grunderwerbsteuer: an example
A purchase price of €400,000 produces very different tax amounts depending on the federal state:
- Bayern (3.5%): €400,000 × 0.035 = €14,000
- Niedersachsen (5.0%): €400,000 × 0.05 = €20,000
- Nordrhein-Westfalen (6.5%): €400,000 × 0.065 = €26,000
The gap between the cheapest and the most expensive state comes to €12,000. When you are weighing up locations in a border region, comparing the rate first can pay off.
Good to know
- List inventory separately: Movable items such as a fitted kitchen, awnings or a sauna do not count as part of the property. If they are listed in the purchase contract at a realistic value, the tax base drops. The tax office normally accepts amounts up to roughly 15% of the purchase price without questioning them.
- No installments: The Grunderwerbsteuer is due as a single payment. In hardship cases you can apply to the tax office for a deferral (Stundung), but you have no legal right to one.
- No payment, no ownership: Only after the tax is paid does the tax office issue an Unbedenklichkeitsbescheinigung (tax clearance certificate). Without this document the Grundbuchamt (land registry office) will refuse to transfer ownership.
Legal basis
The Grunderwerbsteuer is governed by the Grunderwerbsteuergesetz (GrEStG, the Real Estate Transfer Tax Act). Section 1 GrEStG (§ 1) defines the taxable acquisition events, and Section 3 GrEStG (§ 3) sets out the exceptions (inheritances, gifts, sales to relatives in the direct line). Section 11(2) GrEStG (§ 11 Abs. 2) confirms the states' authority to set the rate themselves.
Frequently asked questions
Grunderwerbsteuer translates literally as 'land acquisition tax' and is the German real estate transfer tax (also called property transfer tax). It is a one-time tax due when you buy property or land in Germany, ranging from 3.5% to 6.5% of the purchase price depending on the federal state (Bundesland).
The buyer pays the Grunderwerbsteuer. By law the buyer and seller are jointly and severally liable, but the purchase contract almost always assigns the payment to the buyer.
The tax office sends the tax assessment (Grunderwerbsteuerbescheid) a few weeks after the notarial deed is signed. From the date it arrives, the buyer usually has one month to pay. Only after payment does the tax office issue the Unbedenklichkeitsbescheinigung (tax clearance certificate), without which registration in the Grundbuch (land register) is not possible.
No, on a normal property purchase the Grunderwerbsteuer cannot be avoided. Exceptions apply only to inheritances, gifts and sales between first-degree relatives (for example parents to children). Movable inventory such as a fitted kitchen can be listed separately in the contract to lower the tax base.