Tax tip: Less property tax in case of vacancy and loss of rent

Property tax is hardly a source of joy at the moment. By the end of January, all property owners had to submit a declaration of property tax value, which has led to stress and anger for many. But now there is good news for some property owners.

For landlords, 31 March can be an important and gratifying deadline. They can apply for a partial waiver of the previous year's property tax until this date. This is the case if tenants did not pay rent or did not pay the full amount in the previous year due to economic difficulties or if the flat was even vacant. The application must be submitted informally to the municipality and in the city states of Berlin, Bremen and Hamburg to the tax office. It should be noted that this is a statutory deadline which can only be extended in the case of absolute exceptions such as illness or accident.

The property tax reduction is granted on a staggered basis depending on the amount of the loss of rent. The economic or personal circumstances of the owner are irrelevant. If the actual rental income for the entire calendar year is more than 50 percent lower than the usual annual cold rent, the property tax is waived in the amount of 25 percent upon application by the landlord. If no rent has been paid for the entire year, the property tax is even waived in the amount of 50 percent. The prerequisite, however, is that the vacancy or loss of rent is not the fault of the property owner.

It is obvious that landlords are usually not responsible for rent losses or vacancies due to the current bad economic situation. These situations would be self-inflicted if landlords had not looked for a new tenant or had demanded too high a rent. 

Property owners should therefore check now whether the above-mentioned rent losses have occurred in order to apply for a partial waiver of property tax for the year 2022 by 31 March at the latest.