Personal Tax-free Exemption for 2021
The personal tax-free exemption (Freibetrag) depends on the familial relationship between deceased and beneficiary. In case of unlimited tax liability (unbeschränkte Steuerpflicht) - the following tax free exemptions apply (see § 15 ErbStG and § 16 ErbStG):
Beneficiary is ... | Exemption in EUR |
the spouse of the deceased | 500,000 |
divorced spouse | 20,000 |
a registered same sex partner | 500,000 |
a child of the deceased (including step-children) | 400,000 |
a child of a predeceased child of the deceased | 400,000 |
a child of living children of the deceased | 200,000 |
other offspring of a living child of the deceased | 100,000 |
a parent or an other ascendant | 100,000 |
a sibling (sister or brother) of the deceased | 20,000 |
a niece and nephew of the deceased | 20,000 |
a step-parent of the deceased | 20,000 |
a parents-in-law of the deceased | 20,000 |
a daughters-in-law or son-in-law of the deceased | 20,000 |
an other person | 20,000 |
Tax-free Exemption in Case of Situs Taxation
In cases of situs-taxation, the personal tax free exemption under § 16(1) ErbStG is subject to a reduction which is calculated as follows:
All estate assets and gifts within a 10-year period not subject to German situs taxation
Divided by: All estate assets and gifts in a 10-year period.
For additional information on the calculation of the German inheritance tax, please refer to our article entitled German Inheritance Tax.