Inheriting an apartment or a house in Germany represents a great wealth opportunity, but it also activates a rigorous tax and legal mechanism. Whether you live in Berlin, Frankfurt, Munich, or Stuttgart, understanding how inheritance of property in Germany for Hispanics works will save you unpleasant surprises with the tax office (Finanzamt) and allow you to make the best financial decisions from day one.

The Inheritance Tax in Germany (Erbschaftsteuer)

In Germany, all transfers of property due to death are subject to inheritance tax (Erbschaftsteuer). Unlike other countries where the tax is levied on the total inheritance, the German tax system taxes each heir individually based on the net value they receive and their degree of kinship with the deceased.

The tax categories (Steuerklassen) determine both the tax rate and the amounts exempt from tax:

  • Class I (Steuerklasse I): Spouses, registered partners, children, stepchildren, and grandchildren. The tax rate ranges from 7% to 30%.

  • Class II (Steuerklasse II): Siblings, nephews, parents (in donations), and divorced spouses. The tax rate ranges from 15% to 43%.

  • Class III (Steuerklasse III): Unmarried couples, friends, or heirs without a direct family connection. They are taxed between 30% and 50%.

Exempt Amounts (Freibeträge)

German law grants very generous tax-free amounts for the closest relatives, which are renewed every 10 years:

  • Spouse or registered partner: 500,000 € exempt.

  • Children and stepchildren: 400,000 € for each parent.

  • Grandchildren: 200,000 €.

  • Siblings and other heirs (Class II and III): Only 20,000 €.

The Exemption for Spouses and Children in the Family Home (Familienheim)

There is a significant tax advantage known as the exemption for spouses in inheritance. If you inherit the primary residence (Familienheim) of your deceased spouse, you can be 100% exempt from paying inheritance tax on that property, regardless of whether its market value in listed cities like Cologne or Düsseldorf exceeds one million euros.

To enjoy this total exemption, two non-negotiable requirements must be met:

  • The surviving spouse or partner must move in immediately or continue living in the property as their primary residence.

  • They must maintain residence there for at least 10 uninterrupted years. If the property is sold, rented, or abandoned before completing a decade, the Finanzamt will retroactively collect the tax, unless there is a duly proven force majeure (such as entering a nursing home due to dependency).

For children, a similar rule applies: they are exempt from tax if they live in the property for 10 years, provided that the living space (Wohnfläche) does not exceed 200 square meters. The excess over those 200 m² will be taxed according to the usual scale.

What Happens When Inheriting a German Apartment from Abroad?

Many Spanish speakers wonder what procedures correspond to inheriting a German apartment from abroad (for example, residing in Spain, Mexico, Colombia, or Argentina). Since it is a property located in German territory, there is a real tax obligation (beschränkte Steuerpflicht).

This means that the property is taxed in Germany regardless of where the beneficiaries reside. You have a strict legal deadline of 3 months from the time you become aware of the death to notify the inheritance to the competent tax office. Subsequently, the Finanzamt will require you to submit the formal tax declaration (Erbschaftsteuererklärung).

Mandatory Administrative Steps After Inheritance

1. Certificate of Heirs and Land Registry

To legally dispose of the apartment, you will need to prove your status through a notarial will (notarielles Testament) or by requesting a certificate of heirs (Erbschein) from the local court (Amtsgericht). With this document, you must update the ownership in the land registry (Grundbuch). If you make this registration change within the first 2 years after the death, the process is exempt from court fees.

2. Updating Policies and Asset Protection

By taking ownership of the property, you also assume its contracts and legal responsibilities. It is essential to review immediately:

  • Building Insurance (Wohngebäudeversicherung): Covers damage from fire, storm, hail, and pipe breakage. The policy is automatically transferred to the heir, but you must notify the insurance company of the change of ownership.

  • Liability Insurance for Owners (Haus- und Grundbesitzerhaftpflicht): Essential if you decide to rent the apartment or if it is a single-family home, as you will be liable without limit for falling tiles, accidents due to ice on the sidewalk, or community damages.

  • Legal Protection Insurance for Real Estate (Rechtsschutzversicherung): Key if you are going to manage rental contracts or deal with homeowners' associations (WEG - Wohnungseigentümergemeinschaft).

Protect Your New Real Estate Asset with Expert Advice

Inheriting property in Germany marks a milestone in your economic stability. Adapting the coverage of the property, optimizing your policies, and safeguarding your assets against unforeseen legal issues is the decisive step to making your legacy profitable.

At Finanzen Campuzano by BarmeniaGothaer, we accompany you in Spanish to ensure your home with the appropriate coverage from the BarmeniaGothaer insurance group.

Contact Elvis Campuzano, head of a service center at BarmeniaGothaer:

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