Skip to content

You inherit, make a gift or plan a succession

Paying tax on inheritances and gifts

Understand intestate succession, the compulsory share and the will, inheritance and gift tax and anticipated succession, compute the compulsory share, the allowance, the tax, the family home and the ten-year period, and file the return: 10 steps.

Start here: German intestacy, compulsory portion and wills

Understand: succession and compulsory share, inheritance and gift tax, usufruct

  1. Step 1 of 10
    CoursePaid individually50 min

    German intestacy, compulsory portion and wills

    Who inherits without a will is settled by the German Civil Code through orders, lines of descent and the marital property regime, and for a business that often ends in a community of heirs. The first module covers statutory succession with the extra quarter of the community of accrued gains, the forms of a will and how a Berlin will binds the survivor. The second calculates the compulsory portion and the supplement for gifts with its yearly reduction, sets the limitation and disclaimer deadlines and shows when a notarial will replaces the certificate of inheritance. Two modules with case studies worked on the statute itself.
  2. Step 2 of 10
    CoursePaid individually37 min

    Computing German inheritance and gift tax

    One statute for two events: tax class and allowance decide together, from 500,000 € for a spouse down to 20,000 € in classes II and III. Above them sits the ten-year rule in section 14, which aggregates earlier acquisitions at their EARLIER value — the real planning rule. The second module covers the tariff in section 19: a full-amount tariff in which the rate applies to the WHOLE acquisition, together with the hardship adjustment that cushions the jump at every value band. Two modules with case studies worked on the statute itself.
  3. Step 3 of 10
    CoursePaid individually43 min

    Usufruct and lifetime transfer of property in Germany

    Handing the house to the children during your lifetime while keeping the rent: the German usufruct (Nießbrauch) separates ownership from the right to the income. The first module covers civil law: powers, the cost split under sections 1041 and 1047 BGB, registration in the land register, extinction on death and the ten-year periods of a lifetime transfer. The second covers tax: the capitalised usufruct under sections 14 to 16 BewG reduces the gift, an early death can change that retroactively, and the rental income stays with the usufructuary.

Compute: compulsory share, allowance, tax, family home, ten-year period

  1. Step 4 of 10
    CalculatorFree result

    German compulsory share (Pflichtteil) — children and spouse by property regime

    The compulsory share is half the statutory share, which depends on the property regime: under the default community of accrued gains the spouse takes a quarter plus a quarter; under separation of property with one or two children everyone takes equally, otherwise the spouse takes a quarter; the children split the rest equally.
  2. Step 5 of 10
    CalculatorFree result

    German inheritance tax allowance — what stays tax free

    The allowance belongs to EACH recipient separately: three children have EUR 1,200,000 free between them, not EUR 400,000. It ranges from EUR 500,000 for a spouse to EUR 20,000 in tax classes II and III.
  3. Step 6 of 10
    CalculatorFree result

    German inheritance and gift tax by tax class (ErbStG s. 19)

    This is NOT a banded schedule: the rate of the band reached applies to the WHOLE acquisition, not just the excess. So that one extra euro does not trigger thousands in tax, subsection 3 caps the jump at half — three quarters above 30 % — of the amount above the threshold.
  4. Step 7 of 10
    CalculatorFree result

    German family home exemption — inheritance and gift tax, ErbStG s. 13(1) nos. 4a to 4c

    Between spouses the family home is exempt without limit — as a gift with no holding period, on death subject to ten years of owner-occupation. Children who move in also inherit it tax-free, but only to the extent the living space does not exceed 200 square metres.
  5. Step 8 of 10
    CalculatorFree result

    The ten-year rule — what will the next gift cost?

    The ten years run BACKWARDS from the latest gift: one made nine years after the previous is still aggregated, one made eleven years after is not.

File: inheritance tax return and gift tax return

  1. Step 9 of 10
    FormFree60 min

    German inheritance tax return (Erbschaftsteuererklärung)

    Two duties with two triggers: notify within three months of LEARNING of the accrual, on your own initiative — file the return only on request, with at least one month allowed. And why an opened will does not release you where business assets are involved.
  2. Step 10 of 10
    FormFree45 min

    German gift tax: notification and return

    Three months from AWARENESS, and the donor is under the same duty to notify as the recipient. Why the ten-year period counts backwards from the latest gift, why a gift that went untaxed at the time still counts, and where the 50 per cent cap sits. Guide and worked example.

The other paths

A different procedure, the same principle: the three pillars in order.

Read in German