What is "Grundsteuer" in Berlin?

Grundsteuer is a tax on property, but also on heritable building rights to land. The basis of assessment for property tax is usually the value of the property. In many countries, the tax rate is set at municipal level.The land tax is the most important form of income for local governments in Germany, bringing roughly a 14 billion in revenue into their coffers every year. The tax authority determines the amount per community.The property tax is levied by the municipalities on 1 January each year.

Anyone who owns a piece of land has to pay for Grundsteuer; Either directly or indirectly. The tax is levied on everyone who owns a property. But even if you are a tenant you still probably pay, as landlords almost always pass the cost onto tenants in the form of Nebenkosten (supplementary costs) in their contract.

Grundsteuer- Almost everyone in Germany is affected by the tax, it is worth understanding its relevance.

Why should you care about "Grundsteuer" in Berlin?

Under certain conditions, property tax may be waived upon application. Further details are regulated by 32 to 34 GrStG(-Law). This regulation is particularly interesting for owners of properties that are subject to monument protection. If the costs here are higher than the income, there is a legal claim to a declaration of ownership.In addition, unforeseeable events such as a domestic fire or water damage can favour a tax waiver. The following applies: if the rental income is more than 50% lower than the usual gross income, the landlord can receive a waiver of 25%. If no income is recorded, 50% is granted.

How to handle "Grundsteuer"?

The landlord of living space may allocate the property tax to the tenant as operating costs within the scope of the service charge settlement.

The landlord may deduct the property tax spent as income-related expenses from the income from letting and leasing. The property tax collected by the tenants as part of the service charge settlement belongs to the income from letting and leasing.

Landlords are required to hand in specific information regarding the “Grundsteuerreform” in order to evaluate the value of the apartment/house concerned. Simplified, in Germany you have to pay annually for having landed property. If you should receive a letter of your tax authority we suggest you to contact your tax accountant who will hand in the mandatory information. After processing the information you will receive a notification including the newly evaluated Grundsteuer. 
Usually three factors compile the Grundsteuer. Firstly there is the value of the specific property which is being assessed by standard values resorting back to the 1920s and 1960s. Due to the rapidly developing real estate market these standard values do not achieve satisfying results anymore – strictly comparable properties get evaluated differently due to differently applied standard values. From now on the value of the property gets evaluated individually to achieve satisfying results. Therefore you are obligated to hand in specific information regarding your apartment/flat/house.
Secondly there is the “Steuermesszahl” a magnitude depending on what kind of property you obtain. Thirdly the concerned municipality in which your property is located fixes a specific rate – the “Hebesatz”.
In order to assess the “Grundsteuer” these three factors get multiplied in the following order: Value of the landed property x Steuermesszahl x Hebesatz.
Useful link for more information from official sources: