Inheritance tax / Gift tax

• We recommend a foresighted planning of the transition of your assets in order to achieve an optimized tax result.
• Accepted reductions of your inheritance/gift tax could be achieved if you give your assets periodically to your children. In case of a favourable allocation you can use the tax free amounts several times.
• It is recommendable to check your last will in view of the inheritance tax and gift tax reform. Accordingly, tax free amounts, evaluation of assets and tax rates were changed.
• We advise you when planning the transition of your assets.

Inheritance which involves more than one country

• If you live in Germany and inherit for example real property which is located abroad, it may have a tax effect in Germany as well as in the other country.
• However, a double taxation could be avoided by the regulations of a Double Taxation Agreement (DTA) between Germany and the country in question. But currently DTA's regarding inheritance tax are only in force with Denmark, Greek, Sweden, Switzerland and the United States. The DTA with Austria was cancelled. (DTA's regarding income tax has been concluded with more than 80 states.)
• In case no DTA is applicable Art. 21 of the German Inheritance Tax Law Act stipulates the possibility to set off at least a part of your foreign inheritance tax against the German inheritance tax. However, in order to set off the tax some prerequisites have to be fulfilled.