Statutory share of inheritance and inheritance tax: basics

In short: The statutory share of inheritance guarantees close relatives a minimum portion of an estate even if they were left out of a will. Inheritance tax is levied additionally on inherited assets, depending on allowances and degree of kinship.

In more detail: Those entitled to a statutory share are generally children, spouses, and under certain circumstances the deceased’s parents.

In detail

• Statutory share rate: It amounts to half of the statutory inheritance share the person would have received without a will.
• Disinheritance: Complete exclusion from the inheritance is possible, but the statutory share claim in money usually remains.
• Withdrawal of the statutory share: Only in very narrow legal exceptions, such as serious crimes against the testator, is complete withdrawal possible.
• Inheritance tax allowances: Spouses and children have significantly higher allowances than more distant relatives or non-relatives.
• Tax classes: Inheritance tax is divided into different tax classes with different rates based on degree of kinship.
• Valuation of the estate: Real estate, securities, and business shares are valued according to special rules, which affects the tax burden.
• Early planning: Gifts made during one’s lifetime can help use allowances multiple times and reduce the later tax burden (testament-und-gesetzliche-erbfolge, steuerklassen-und-lohnsteuer).