Germany: Inheritance

Germany: Inheritance

Inheritance tax is levied on transfers of property (assets) after death. This duty is paid by the beneficiary. Marginal rates applicable vary depending on the relationship of the beneficiary to the deceased. There are three relevant classes of relationship and exemptions applicable: INHERITANCE TAX   CLASS RELATIONSHIP EXEMPTION (€) I Spouse 307,000   Children and step-children, grandchildren 205,000   Parents and grandparents 51,200 II Siblings and their children, step-parents,     parents-in-law and divorced spouse 10,300 III All others 5,200 If the beneficiary and the deceased are both nonresidents, the standard personal exemption is only €1,100. A higher amount may be granted in the case of a surviving spouse.For property transfers upon death, the surviving spouse and children up to 25 years are granted a special support allowance. The support allowance amounts to €256,000 for the surviving spouse. The support allowance for the children varies depending on the children’s age; it ranges from €52,000 for each child up to five years old and €10,300 for each child between the ages of 20 and 25 years old. Transfers of property are subject to inheritance tax at graduated rates depending on the value of the property and the classes of family relationship. TAX RATES ON DIFFERENT CLASSES     CLASSES NET INHERITANCE (€) I II III Up to €52,000 7% 12% 17% €52,000 - €256,000 11% 17% 23% €256,000 - €512,000 15% 22% 29% €512,000 - €5,113,000 19% 27% 35% €5,113,000 - €12,783,000 23% 32% 41% €12,783,000 - €25,565,000 27% 37% 47% Over €25,565,000 30% 40% 50%