In Germany, <\/em>inheritance is subject to tax<\/em><\/strong>. However, there are allowances that vary depending on the degree of relatedness and the amount of the inheritance. These allowances make it possible to pay less levy.<\/em><\/p>\n This article explains the various allowances, tax rates for inheritance and further information on inheritance tax.<\/em><\/p>\n Inheritance: subdivision into tax classes (I-III)<\/p>\n How much of the inheritance is actually tax-free depends, among other things, on the degree of kinship.<\/p>\n The higher or more direct this is, the greater the personal tax-free amount.<\/p>\n \u00a7Section 15, 16 Inheritance Tax and Gift Tax Act (ErbStG) divides the relationships into three tax classes. However, these are independent of the tax classes<\/strong> for income tax.<\/p>\n This includes all relatives in the direct line:<\/p>\n Spouses\/registered civil partnerships, children and stepchildren as well as grandchildren and great-grandchildren. However, the tax-free amounts also differ in the individual classes.<\/p>\n – Spouses and civil partners: 500,000 euros<\/p>\n – Children, stepchildren and orphaned grandchildren: 400,000 euros<\/p>\n – Grandchildren: 200,000 euros<\/p>\n – Great-grandchildren: 100,000 euros<\/p>\n – Siblings, nieces, nephews: 20,000 euros<\/p>\n – Step-parents, children-in-law\/parents-in-law: 20,000 euros<\/p>\n – Divorced spouses: 20,000 euros<\/p>\n – All other heirs: 20,000 euros<\/p>\n If the inheritance is more than the tax-free amount, the government only taxes the part that is above this amount.<\/p>\n Example:<\/strong> Max Mustermann inherits 800,000 euros as a spouse from his deceased wife.<\/p>\n The tax-free amount in this case is 500,000 euros, so he has to pay duties on the 300,000 euros above this amount.<\/p>\n In addition to the allowances in the respective tax classes, there are further regulations that provide for tax exemption.<\/p>\n Spouses, civil partners, children, stepchildren and grandchildren without a pension can apply for their own allowances.<\/p>\n Spouses\/registered partnership: 256,000 euros<\/p>\n Children up to 5: 52,000 euros<\/p>\n Children between 6-10: 41,000 euros<\/p>\n Children between 11-15: 30,700 euros<\/p>\n Children between 16-20: 20,500 euros<\/p>\n Children between 21-27: 10,300 euros<\/p>\n If you receive a widow’s, widower’s or orphan’s pension, we deduct the amount from the pension contribution. The difference then defines the actual tax-free amount.<\/p>\n Example: Max Mustermann applies as a widower for 256,000 euros as a pension contribution in accordance with \u00a717 ErbstG. Once he has calculated how much widower’s pension he will receive, he can deduct this amount from the EUR 256,000.<\/p>\n The resulting amount, e.g. 150,000 euros, is then legally tax-free.<\/p>\n Good to know:<\/strong><\/p>\n The German Inheritance Tax and Gift Tax Act changed on June 25, 2017. The purpose of the change was to comply with European laws on combating tax avoidance.<\/p>\n This includes the rules for limited or unlimited tax liability and the tax-free amount for pensions.<\/p>\n With the amendment to Section 17 ErbStG, the surviving spouse or partner or the deceased’s child is also granted the special pension allowance<\/strong> in cases of limited tax liability<\/strong>. This law means that if you get an allowance under Section 16 ErbStG, you can also use Section 17 ErbStG.<\/p>\n The special pension allowance is reduced by foreign pension payments for spouses and children, similar to domestic pension payments.<\/strong><\/p>\n Spouses or children who have taken care of the deceased person without receiving payment can receive EUR 20,000. Section 13 (1) No. 9 of the ErbStG states this.<\/p>\n Note here that it is important to well document the support.<\/p>\n The death of a loved one usually causes further costs for the surviving dependants.<\/p>\n![\"Inheritance](\"https:\/\/suw-steuerberatung.de\/wp-content\/uploads\/2024\/01\/Erbe-in-Deutschland-Freibetraege-fuer-weniger-Erbschaftsteuer.png\")
Inheritance in Germany: Tax allowances for reduced inheritance tax<\/h2>\n
Tax class I<\/h3>\n
Tax class II<\/h3>\n
Tax class III<\/h3>\n
Lump sums as additional allowances<\/h2>\n
Special pension allowance: \u00a717 ErbStG<\/h3>\n
Care contribution: \u00a713 para. 1 no. 9 ErbStG<\/h3>\n
\u00a0Inheritance liabilities: \u00a710 ErbStG<\/h3>\n
![\"inheritance](\"https:\/\/suw-steuerberatung.de\/wp-content\/uploads\/2024\/01\/inheritance-tax-classes.jpg\" "\\"inheritance")