Anyone who holds assets in several countries or moves their centre of life abroad will sooner or later ask whether a will is enough or whether an inheritance contract (Erbvertrag) instead of a will is the better choice for international assets. Both instruments can be combined with a choice of law under the European Succession Regulation. They differ considerably, however, in binding effect, form, costs and evidential value, and in cross-border cases further pitfalls are added. This article explains the differences, shows when the inheritance contract offers advantages and when it can become a trap. Legal position: September 2026.
Basics: What distinguishes a will from an inheritance contract
German law knows three common forms of disposition, which are often mixed in practice:
- Individual will: The disposition of a single person. It can be made in the testator’s own handwriting (Section 2247 of the German Civil Code, Bürgerliches Gesetzbuch, BGB) or before a notary (Section 2232 BGB) and can be freely revoked at any time.
- Joint will (gemeinschaftliches Testament): Only spouses (Section 2265 BGB) and registered civil partners (Section 10 (4) of the Civil Partnership Act, LPartG) can make one. So-called mutually dependent dispositions (wechselbezügliche Verfügungen) can only be revoked to a limited extent during the lifetime of both partners (Section 2271 BGB) and as a rule become binding after the death of the first to die. The best-known example is the Berlin will (Berliner Testament).
- Inheritance contract: A contract that can only be concluded in a deed recorded by a notary (Section 2276 BGB) and that the testator must conclude in person (Section 2274 BGB). Contractual dispositions bind the testator; later deviating dispositions upon death are ineffective to that extent (Section 2289 (1) BGB). Persons who are not married to each other can also conclude an inheritance contract, and it is possible for only one of the contracting parties to be bound.
The European Succession Regulation (Regulation (EU) No 650/2012, EuErbVO) also makes this distinction. It defines the agreement as to succession in Article 3 (1) (b), including an agreement resulting from mutual wills, and the joint will in Article 3 (1) (c) as a will drawn up in one instrument by two or more persons. How a German joint will with binding effect is classified abroad is therefore not always clear. The legal systems of some states recognise neither inheritance contracts nor joint wills, or attach different consequences to them than German law; a local adviser must be consulted on this.
Which law applies: the starting point of the decision
The question of the applicable law comes before the question of the instrument. Since 17 August 2015, Article 21 EuErbVO provides that the law of the state in which the deceased had their habitual residence at the time of death applies. Nationality only matters if a choice of law has been made. A frequently repeated misconception is that the place of death decides: anyone who spends the winter abroad and dies there is therefore not automatically inherited from under foreign law. What counts is habitual residence, which the European Court of Justice understands as the result of an overall assessment of the circumstances of life in a single Member State (CJEU, judgment of 16 July 2020, C-80/19). There is no fixed period. The six-month rule of Section 9 of the German Fiscal Code (Abgabenordnung, AO), familiar from tax law, cannot be transferred to succession law; on the tax law side, see habitual abode in German tax law.
Anyone who does not want to rely on a later overall assessment can choose the law of their home state under Article 22 EuErbVO. The choice of law must be made expressly in a disposition of property upon death or be clearly demonstrated by its terms. Anyone with several nationalities can choose between these laws. The law of a state of which one is not a national cannot be chosen. What this looks like in detail is covered in the article will and succession law when living abroad. On the basic question of when German succession law continues to apply despite residence abroad, see also German inheritance law with residence abroad.
Without a choice of law, surprises can occur: if the deceased changes their residence several times, the applicable law can change. The Regulation does aim at unity of the estate, so that a single law governs the entire estate. There are exceptions, however, for example in the case of prevailing international conventions (Article 75 EuErbVO), special rules of the state where assets are located (Article 30 EuErbVO) and renvoi from third states. A split estate (Nachlassspaltung) therefore remains possible in individual cases even since 2015.
Advantages of the inheritance contract for international assets
Choice of law with special protection (Article 25 EuErbVO)
For agreements as to succession, the Regulation contains its own conflict-of-laws rule. Under Article 25 (1), the admissibility, substantive validity and binding effects of an agreement as to succession regarding the estate of one person are governed by the law that would have applied to the succession if that person had died on the day the agreement was concluded. For agreements regarding the estates of several persons, the agreement must be admissible under the law applicable to each of these persons; substantive validity and binding effects, including the conditions for its dissolution, are then governed by whichever of the laws relevant under the first subparagraph has the closest connection to the agreement (Article 25 (2)). Under Article 25 (3), the parties can choose the law of the nationality of one of the persons involved for admissibility, substantive validity and binding effects.
In practical terms: a German inheritance contract with an express choice in favour of German law makes it clear that its binding effect is assessed under German law, even if one of the parties later moves abroad. This is a key reason why an inheritance contract is worth considering in cross-border cases; whether it is more sensible than a will depends on the individual case. Whether a foreign state outside the EU recognises this choice of law is a question of that state’s law.
Binding effect: protection against later changes
The inheritance contract prevents the survivor or a contracting party from later making different dispositions. This is particularly relevant for international assets where:
- children from different relationships are to be provided for and nobody should have to rely on a later amendment,
- one party later reorients their life abroad and the contract is nevertheless meant to remain in force,
- foreign assets are intended for a particular heir who already uses or looks after them.
Section 2286 BGB must be borne in mind: despite an inheritance contract, the testator in principle remains free to dispose of their assets during their lifetime. Against gifts made with the intention of disadvantaging the contractual heir, Section 2287 BGB helps by establishing a claim for surrender. A foreign property that is sold or given away during the testator’s lifetime therefore does not simply escape the inheritance contract, but it can be difficult to recover in practice.
Waiver of inheritance and of the compulsory portion in the same contract
An inheritance contract can combine waivers of inheritance or of the compulsory portion (Sections 2346 et seq. BGB) as well as waivers of benefits. Especially where the applicable law provides for forced heirship, which makes those entitled to a compulsory share co-heirs instead of merely granting them a monetary claim, an effective waiver can prevent disputes. Here too, the validity of a waiver is governed by the law applicable to the succession, which is determined under the Regulation. More on compulsory portion claims across borders can be found in the article compulsory portion and foreign assets.
Notarial form and proof
Because the inheritance contract must be notarised, it is drawn up with notarial advice and is as a rule registered in the Central Register of Wills (Zentrales Testamentsregister) of the Federal Chamber of Notaries and deposited with the local court (deposit can be excluded under Section 34 (2) of the Notarisation Act, BeurkG). According to the Federal Court of Justice, banks may not generally require a certificate of inheritance (Erbschein) in their general terms and conditions; a notarial will together with the record of its opening (Eröffnungsniederschrift) can be sufficient depending on the individual case (BGH, judgment of 8 October 2013, XI ZR 401/12). In Germany, the notarial disposition with the record of its opening is also regularly sufficient for the land registry. Abroad, this only helps to a limited extent. There, banks and land registries often demand their own evidence; within the EU, the European Certificate of Succession may be an option.
Disadvantages and risks of the inheritance contract
Lack of flexibility on emigration and changes in life
The binding effect works in both directions. Anyone who emigrates, divorces or remarries cannot change an inheritance contract unilaterally. It can be cancelled by contract (Section 2290 BGB) or by withdrawal if this was reserved in the contract (Section 2293 BGB) or if there is a statutory ground for withdrawal (Sections 2294, 2295 BGB). A withdrawal must be declared before a notary (Section 2296 BGB). The rule is therefore: anyone who moves internationally should deliberately draft reservations of amendment or withdrawal for foreseeable events.
Not every foreign country accepts the inheritance contract
Various legal systems prohibit inheritance contracts or do not recognise binding dispositions. The EuErbVO partly resolves this through the connecting factor in Article 25 EuErbVO, but it cannot force a third state or a foreign land registry to accept the German binding effect. Whether a target state recognises inheritance contracts should be clarified by a local adviser.
Several dispositions in several countries
If there are several wills or contracts in different states, for example an older foreign will and a new German inheritance contract, disputes can arise as to whether the dispositions complement or cancel each other. Make sure that a new inheritance contract expressly states which earlier dispositions are revoked or continue to apply and whether it covers the entire estate or only parts of it.
Comparison: will, joint will, inheritance contract
← Tabelle nach links wischen, um weitere Spalten zu sehen
| Criterion | Individual will | Joint will | Inheritance contract |
|---|---|---|---|
| Who can make it? | Any adult alone | Only spouses and registered civil partners | Anyone; it is also possible for only one contracting party to be bound |
| Form | Handwritten or notarial | Handwritten (one spouse writes, both sign) or notarial | Notarial only, personal attendance |
| Binding effect | None, freely revocable | Mutually dependent, binding after the first death | Contractual dispositions are binding |
| Choice of law | Article 22 EuErbVO | Article 22 EuErbVO, classification abroad partly uncertain | Article 22 and Article 25 (3) EuErbVO |
| Notary fee (standard rate) | 1.0 (No. 21200 KV GNotKG) | 2.0 in notarial form | 2.0 (No. 21100 KV GNotKG) |
| Certificate of inheritance needed? | Usually yes for a handwritten will | Usually yes in handwritten form | Usually not in Germany |
The cost figures are the standard rates from Annex 1 to the Court and Notary Fees Act (Gerichts- und Notarkostengesetz, GNotKG); the business value based on the estate is also decisive. For the choice of law, Section 104 (2) GNotKG adds a further value of 30 percent of the value of the estate if it is notarised. This is not the same as a fee rate increased by 30 percent. The notary can give you a binding figure for the costs in the individual case.
Common mistakes in practice
- Forgetting the choice of law. A German inheritance contract without an express choice of law is assessed under Article 25 (1) EuErbVO, but the law applicable to the estate as a whole can change with the move abroad.
- Underestimating the binding effect. Anyone who binds themselves contractually and later emigrates can no longer freely change their dispositions. Without reservations, only a contract, rescission or a statutory withdrawal remain.
- Thinking only of succession law. Succession law and tax law must be examined separately. Under Section 2 (1) No. 1 of the Inheritance and Gift Tax Act (Erbschaftsteuer- und Schenkungsteuergesetz, ErbStG), unlimited tax liability continues for German nationals for five years after moving away, irrespective of the applicable succession law. The allowances of Section 16 ErbStG then apply in Germany, for example EUR 500,000 for the spouse and EUR 400,000 for a child. The notification period under Section 30 ErbStG is three months. How double tax treaty rules work here is explained in the article German inheritance tax and double taxation treaties.
- Ignoring matrimonial property law. The EuErbVO governs neither matrimonial property law nor inheritance tax. How the matrimonial property regime interacts with succession must be examined separately, see matrimonial property clause in an international marital agreement.
- Not aligning articles of association. Anyone who holds company shares must align the succession clauses in the articles of association with the inheritance contract; otherwise an inheritance contract can come to nothing. See business succession when a shareholder emigrates.
- Overlooking special cases. For children with disabilities, an inheritance contract without a well-thought-out structure is risky; see disabled person’s will when living abroad.
Example: married couple with a holiday home abroad
Example (fictitious persons and figures): Karl and Marlene, both German nationals, live in southern Germany. They own a house in Germany worth EUR 600,000 and a holiday apartment elsewhere in Europe worth EUR 250,000. They have two children, want to provide for each other and plan to spend longer periods abroad in retirement.
A Berlin will would provide for the surviving spouse. If the couple later moves abroad permanently without having made a choice of law, the law applicable to the succession can change, and the German joint will may be treated differently in the state of residence. A notarial inheritance contract with an express choice in favour of German law (Article 22 and Article 25 (3) EuErbVO) and with a reservation of withdrawal in the event of separation creates more clarity. As additional protection, a waiver of the compulsory portion by the children for certain foreign assets can be considered. It remains important to check with a foreign adviser whether the state where the holiday apartment is located imposes special requirements (Article 30 EuErbVO).
Practical approach
- Check the applicable law: habitual residence now and in the future, nationalities, location of the assets.
- Clarify the goal: is a binding effect wanted, or is flexibility more important?
- Include the choice of law expressly, in an inheritance contract also under Article 25 (3) EuErbVO.
- Draft reservations: withdrawal or amendment reservations for emigration, divorce, sale of assets.
- Review and align existing dispositions in Germany and abroad.
- Prepare proof: notary, register of wills, where applicable the European Certificate of Succession.
- Examine the tax consequences in Germany and abroad and involve a foreign adviser where foreign law is affected.
Conclusion
For international assets, an inheritance contract is not a substitute for the choice of law but an additional instrument. It pays off when a binding effect is desired, several persons are involved or a waiver by those entitled to a compulsory portion makes sense. A will remains preferable when flexibility is more important. In both cases, what matters is that the choice of law is made expressly, the move abroad is taken into account and the tax side is examined separately.
Frequently asked questions
Can I choose German law in an inheritance contract if I live abroad?
Yes, provided you are a German national. Article 22 EuErbVO allows you to choose the law of your nationality for the succession, and Article 25 (3) EuErbVO additionally for the admissibility, validity and binding effect of the inheritance contract. Whether a state outside the EU recognises this choice depends on its law.
Is an inheritance contract irrevocable?
Not without exception. It can be cancelled by contract (Section 2290 BGB), and withdrawal is possible if it has been reserved or there is a statutory ground (Sections 2293 to 2295 BGB). Free later dispositions are, however, ineffective to the extent that they impair contractual dispositions.
Can I still give away or sell my assets after concluding an inheritance contract?
In principle yes (Section 2286 BGB). However, if you make gifts with the intention of disadvantaging the contractual heir, the contractual heir can demand surrender after the succession has occurred (Section 2287 BGB).
Do my heirs not need a certificate of inheritance with an inheritance contract?
In Germany, the inheritance contract and the record of its opening are often sufficient, for example for banks and the land registry. Abroad or within the EU, the European Certificate of Succession may be required. It does not replace the German certificate of inheritance but exists alongside it (Article 62 EuErbVO).
What does an inheritance contract cost compared with a will?
The standard rate for notarising an inheritance contract is a 2.0 fee (No. 21100 KV GNotKG), for an individual will a 1.0 fee (No. 21200 KV GNotKG), in each case based on the business value. A notarised choice of law increases the value under Section 104 (2) GNotKG. A handwritten will incurs no notary costs, but as a rule offers less certainty in terms of proof and advice.
Does the law applicable to my succession change if I emigrate after notarisation?
Without a choice of law, the law applicable to the estate can change, because habitual residence at the time of death is decisive. For the binding effect of the inheritance contract, Article 25 (1) EuErbVO refers to the time the contract was concluded. The two levels should be examined separately.
Attorney Dr. Johannes Fiala has published extensively on international succession law and tax law and supports clients in his firm in drafting wills and inheritance contracts with a cross-border element in a legally sound way, formulating the choice of law correctly and keeping the tax consequences in view. Please get in touch with Attorney Dr. Johannes Fiala without obligation to discuss your individual situation in an initial consultation.
