How to protect your assets from gift tax
First of all, it is important to clarify the question of why such a bizarre-sounding tax as the gift tax is actually levied in Germany. The widespread belief that one can freely dispose of one’s own property and private assets, which have already been severely affected by income tax, value added tax, wealth tax and/or capital gains tax, etc., very quickly turns out to be a fallacy. A closer look will reveal two things:
1. there is generally no business without father state holding out his hand
2. gift tax is regulated in the same law as inheritance tax
While the former is a bitter but not new realization, the latter quickly reveals what the gift tax is designed to avoid. The gift tax is intended to counteract circumvention of the inheritance tax and is handled in Germany according to the same principle as the inheritance tax. Gift tax applies to individuals who receive assets of any kind(real estate, cash, valuables) as a gift. The amount of gift tax to be paid to the respective tax office depends on the relationship between the donee and the donor and the value of the gift.
The most effective means of avoiding or even avoiding the issue of inheritance and gift tax is to deal with this issue at an early stage. A suitable strategy, especially in the case of large assets, is essential in order to make the best possible use of allowances when making gifts as well as inheriting. We will be happy to advise you individually on further options.
How we advise you on the subject of gifts and inheritance tax:
- General asset protection planning and consulting
- Advice on the efficient use of allowances
- Support with deadlines & reporting requirements
- Examination of the legal security of installations at home and abroad
- Protection of one’s own estate from access by authorities and creditors
- Drafting of wills
- Strategy for building up non-garnishable assets
- Drafting of marriage contracts
- Testing of existing installations for security
Helpful articles on asset protection & gift tax:
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About the author
PhD, MBA, MM
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.
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