real estate transfer tax

noun · Grunderwerbsteuer

Grunderwerbsteuer, a one-off tax on acquiring German land, triggered by the purchase contract rather than the register entry, § 1 GrEStG. The rate is set by each Land and runs from 3.5 to 6.5 per cent, and share deals can trigger it too.

Which translation, when

Grunderwerbsteuerthe transaction tax on the acquisition of land, § 1 GrEStG, arising already with the Kaufvertrag that founds the claim to transfer, not with the Grundbuch entry, and charged on the Gegenleistung, § 8 GrEStG.

Anteilsübertragungthe share-deal reach: where land sits in a company, at least 90 per cent of the shares passing to new owners or uniting in one hand can itself trigger the tax, § 1 Abs. 2a, 2b and 3 GrEStG, so a corporate deal is not automatically outside it.

Why

Real estate transfer tax is Grunderwerbsteuer, and three things about it surprise a UK reader. First, timing: under § 1 GrEStG the tax attaches to the obligation, the Kaufvertrag or other act that founds the claim to Übereignung, not to the Auflassung or the Grundbuch entry, so it arises when the contract is signed, not when title passes. Second, the rate: Grunderwerbsteuer is a Ländersteuer and each Land sets its own, from 3.5 per cent in Bavaria up to 6.5 in several others, charged on the Gegenleistung, § 8 GrEStG, so there is no single national figure. Third, share deals: where land is held in a company, acquiring the company can trigger the tax without any land changing hands, whether because at least 90 per cent of the shares pass to new owners, § 1 Abs. 2a and 2b GrEStG, or unite in a single hand, § 1 Abs. 3 GrEStG. The nearest UK tax is Stamp Duty Land Tax under the Finance Act 2003, but the trigger, the varying Land rates and the share-deal rules are German particulars, and a translation that treats it as a flat national duty on completion misses all three. The share-deal rules were amended again in 2026 and should be checked against the current GrEStG.

Typical mistakes

Grunderwerbsteuer is triggered by the purchase contract, § 1 GrEStG, not by the Grundbuch entry, so dating the charge to completion or registration is wrong.
The rate is set by each Land, from 3.5 to 6.5 per cent, so there is no single German figure, and quoting one national rate misstates the cost.
It is the one-off transaction tax on acquiring land, not the annual Grundsteuer, and a share deal in which at least 90 per cent of a landholding company changes hands or unites in one hand can trigger it, § 1 Abs. 2a to 3 GrEStG.

What matters

Costing a German property purchase for a UK buyer, the transfer tax has to be pinned to the signing of the Kaufvertrag, § 1 GrEStG, and to the specific Land’s rate between 3.5 and 6.5 per cent, not to completion at a national figure. On a corporate acquisition the share-deal reach of § 1 Abs. 2a to 3 GrEStG needs flagging, since the tax can bite with no land changing hands.

Authority

§ 1 GrEStG
§ 8 GrEStG
Finance Act 2003

What the machine misses

Machine output renders real estate transfer tax as Grunderwerbsteuer, then presents it like a flat national duty on completion. It loses that the tax arises with the Kaufvertrag, not the Grundbuch entry, § 1 GrEStG, that the rate is a Land matter running from 3.5 to 6.5 per cent, and that a 90 per cent share deal can trigger it without land moving, § 1 Abs. 2a to 3 GrEStG. The rendering hides both the timing and the rate that decide the cost.

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Examples

liable to real estate transfer tax	der Grunderwerbsteuer unterliegen
real estate transfer tax on the purchase price	Grunderwerbsteuer auf den Kaufpreis
the applicable rate in the Land	der im Land geltende Steuersatz
a share deal triggering transfer tax	ein die Grunderwerbsteuer auslösender Share Deal