Inheritance rights and obligations in another Member State

In accordance with statutory succession law, the spouse and relatives, i.e. those with parents, grandparents or great-grandparents in common, are the legal heirs pursuant to sections 1924 et seqq. of the German Civil Code (, BGB). Other heirs can be designated by means of a will or agreement as to succession. However, the spouse and close relatives are still entitled to a reserved share.

Upon the death of a person, that persons assets, including debts, devolve as a whole to the heirs pursuant to section 1922 BGB. An heir may, in principle, waive the succession within 6 weeks of the date of obtaining knowledge of the succession pursuant to section 1942 et seqq. BGB.

Inheritance tax

Whether and to what extent inheritance tax is to be paid depends on the value of the acquisition (inheritance, legacy, reserved share, etc.), and the relationship between the heir and the deceased.

The enrichment of the heir is deemed a taxable acquisition. This is the value of the acquired assets, insofar as this is not tax-free, less the obligations of the estate issuing from the deceased and less the tax-exempt amounts.

The valuation of all types of assets is always based on their market value.

Inheritance tax is calculated according to the value of the taxable acquisition and in accordance with the tax rate applicable to the heirs depending of their tax bracket:

• Tax bracket I: Spouses and civil partners, children (born in and out of wedlock), adopted children, stepchildren, grandchildren and other descendants as well parents and grandparents; tax rate 7% to 30%.
• Tax bracket II: Siblings (half-siblings, children of siblings, step-parents, parents-in-law, children-in-law and divorced spouses; tax rate 15% to 43%.
• Tax bracket III: all remaining heirs; tax rate 30% to 50%.

The personal tax-exempt amounts are as follows:

• EUR 500 000 for the spouse
• EUR 400 000 for a child or a grandchild inheriting in lieu of a deceased child
• EUR 200 000 for grandchildren
• EUR 100 000 for the other persons in tax bracket I
• EUR 20 000 for persons in tax bracket II and
• EUR 20 000 for persons in tax bracket III.

Within the EU, the EU Succession Regulation (ESR) applies to deaths occurring after 17 August 2015. Devolutions of an inheritance from before 17 August 2015 are governed by Article 25 of the Introductory Act to the German Civil Code (Einführungsgesetz zum Bürgerlichen Gesetzbuch, EGBGB), old version.

The ESR also regulates the recognition and enforcement of decisions and the acceptance and enforcement of authentic instruments in matters of succession, as well as the possibility of applying for a European Certificate of Succession.

• Legislation on inheritance rights and obligations in the German Civil Code:
• Inheritance Tax and Gift Tax Act (Erbschaftsteuer- und Schenkungsteuergesetz, ErbStG) (only in German)
• Brochure of the Federal Ministry of Justice Erben und Vererben (Inheritance) (only in German)