Inheritance and gift tax returns
Who is obliged to submit a gift tax return or inheritance tax return?
Pursuant to §30 ErbStG (Inheritance Tax Act), every purchaser must notify the competent inheritance tax office in writing of any benefits (gifts, inheritances) within 3 months of becoming aware of the incident or the occurrence of the obligation. In the case of donations, this obligation also applies to the donor. Exceptions apply in the following cases:
The acquisition is based on a disposition of death passed by
- a German court
- a German notary public or
- a German consul
who opened a death warrant and the relationship to the testator undoubtedly results from this order. This does not apply if it is part of the acquisition:
- Real estate, business assets, shares in corporations that are not subject to the disclosure obligation pursuant to § 33 ErbStG or
- Foreign assets.
In this case, a report to the tax office is still required.
A notification is not required if a gift is legally or notarially notarised among living persons.
Inheritance tax rates and allowances
If you know your assets and your inheritance ratio, you can easily determine whether and how much inheritance tax would be payable by using the inheritance tax rates. However, the valuation for inheritance tax purposes sometimes differs from the market value. In addition to the personal tax exemptions, there are also factual tax allowances and, for example, deductions for the transfer of company assets.
What can happen if you do not submit a gift tax return or inheritance tax return?
If you fail to report this, tax evasion may occur if the tax-free amounts are exceeded (because only then is there a tax that could be evaded). Tax evasion can also occur if taxes are not determined in good time and if the limit of € 25,000 evaded taxes (§371 AO) is exceeded, exemption from punishment for late notification can only be obtained by paying a surcharge of 10-20%, depending on the amount of tax evaded. If you are unsure, we recommend that you arrange an appointment with us.
We prepare your inheritance tax and gift tax returns
If you would like us to prepare your gift tax return or the inheritance tax return of another person, we need some information about the testator or donor and the heir or donee. If there is a will, bequest, prenuptial agreement or partnership agreement, please enclose a copy. In addition, we require information and evidence on the type and amount of the testator’s assets on the date of death or on the donation on the date of the donation, even if these assets have been reduced or increased in the meantime.
We not only prepare gift tax returns and inheritance tax returns and determine the necessary values according to inheritance tax principles, but also prepare expert opinions on inheritance tax and anticipated succession.