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Inheritance and estate planning laws in Europe

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2026-10-17 04:18 UTC → 2026-10-20 06:42 UTC · added removed

Legal frameworks in Germany and Switzerland govern the distribution of assets through testamentary instructions and statutory succession. In Germany, the Bürgerliches Gesetzbuch (BGB) dictates that if no valid will exists, assets are distributed based on kinship orders. First-order heirs, such as children, take precedence over second-order heirs like parents. Specific regulations include a six-week deadline to renounce an inheritance under § 1944 BGB and the right to a compulsory portion for close relatives under § 2303 BGB. For a handwritten will to be legally valid, it must be entirely written by hand and include the testator’s name, location, and date. Under statutory succession for spouses in a community of accrued gains, a surviving spouse typically inherits half of the estate if children are present, while children share the remaining half. To mitigate disputes within an inheritance community, disputes, legal instruments like a ‘Berliner Testament’ can be utilized to name spouses as sole heirs initially. utilized. Inheritance tax liability in Germany is determined by estate value and kinship. Significant kinship, with significant tax-free allowances include 500,000 euros for spouses and registered partners, 400,000 euros per parent for spouses, children, and 200,000 euros for grandchildren. For non-relatives or distant relatives, the allowance is 20,000 euros. Recent developments involve the German Federal Constitutional Court reviewing the constitutionality of inheritance and gift tax regulations, particularly concerning regarding business assets and regional variations. assets. The State of Bavaria has filed a motion arguing that current nationwide rules are inequitable, noting that inequitable due to stagnant tax-free allowances have remained unchanged since 2009 despite rising real estate values. While Bavaria seeks regional tax adjustments, North Rhine-Westphalia has opposed the motion. Additionally, 2009. In October 2026, the Central Association of German Crafts (ZDH) is investigating how tax burdens affect Federal Fiscal Court (Bundesfinanzhof) issued rulings affecting business succession and job preservation through inheritance taxation. Regarding business sales, the court addressed whether payments to managing shareholders for continued service should be classified as employment income or part of the sale price under § 17 EStG, noting that the entire value increase of a survey running until December 8, 2026. A participation should be captured under that statute. Additionally, the court ruling is expected clarified the tax exemption for the ‘family home,’ establishing that garden and pathway areas used in early 2027. conjunction with the property can be included in the tax-exempt residential area. This ruling follows concerns regarding rising real estate values and the financial burden on heirs.

Versions

  1. 2026-10-20 06:42 UTC Inheritance and estate planning laws in Europe
  2. 2026-10-17 04:18 UTC Inheritance and estate planning laws in Europe
  3. 2026-10-13 09:33 UTC Inheritance and estate planning laws in Europe
  4. 2026-09-28 15:43 UTC Inheritance and estate planning laws in Europe

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