Anticipated succession: Gift allowances can be used more than once

Gifts inter vivos are also taxed like inheritances – both are regulated in the same law, the Inheritance Tax Act: When assets are transferred, the inheritance tax allowances of 307,000 euros for the spouse, 205,000 euros for children and children of deceased children and 51,200 euros for other grandchildren – every 10 years – are granted again. In the case of a large estate, it may therefore be advisable to start transferring assets in good time in order to make multiple use of the tax allowances (§§ 14, 16 ErbStG). It is important that wills and inheritance contracts are regularly reviewed as part of succession planning – a typical tax trap is the so-called “Berlin Will” which often results in much more inheritance tax than necessary. Additional assets can also be transferred through tax-free occasional gifts (jewelry, car, holiday allowance, etc.). A limit for tax-free occasional gifts is not regulated in the law. Generally, values of around 40,000 euros can be transferred here. If the inheritance tax is only up to 50 Euros, it is not assessed or levied, § 22 ErbStG. The tax-free amounts (including § 22 ErbStG) as of 2002 are: tax class I 307,714 Euro for the spouse or 205,714 Euro for children, tax class II 10,716 Euro (e.g. for siblings) and tax class III 5,494 Euro (e.g. for the girlfriend). It is important for the arrangement within the family to check the question of maintenance in advance: This is because maintenance payments cannot usually be deducted for the payer (except, for example, in the case of divorce with an agreement on taxation in conjunction with Annex U). However, alimony payments remain tax-free to the recipient for income and estate tax purposes….
Source:Fiala, Freiesleben & Weber Law and Patent Attorneys, Auditors and Tax Consultants

Our office in Munich

You will find our office at Fasolt-Strasse 7 in Munich, very close to Schloss Nymphenburg. Our team consists of highly motivated attorneys who are available for all the needs of our clients. In special cases, our law firm cooperates with selected experts to represent your interests in the best possible way.

About the author

Dr. Johannes Fiala Dr. Johannes Fiala

Dr. Johannes Fiala has been working for more than 25 years as a lawyer and attorney with his own law firm in Munich. He is intensively involved in real estate, financial law, tax and insurance law. The numerous stages of his professional career enable him to provide his clients with comprehensive advice and to act as a lawyer in the event of disputes.
»More about Dr. Johannes Fiala

On these pages, Dr. Fiala provides information on current legal and economic topics as well as on current political changes that are of social and/or corporate relevance.

Arrange your personal appointment with us.

Make an appointment / call back service

You are already receiving legal advice and would like a second opinion? In this case please contact Dr. Fiala directly via the following link.

Obtain a second legal opinion

The first telephone call about your request is free of charge.