Full tax allowance also for heirs abroad

Even those who are only subject to limited inheritance tax are entitled to the higher tax allowances to which fully taxable heirs are entitled.

The amount of the inheritance tax allowance for persons living abroad but receiving assets in Germany has already been the subject of court proceedings on several occasions. According to the law, these persons only have an allowance of 2,000 euros, regardless of the degree of relationship, as long as they do not apply for unlimited tax liability. However, the European Court of Justice (ECJ) has now also ruled this option provision to be contrary to European law. The Düsseldorf Tax Court, which referred the question to the ECJ, subsequently awarded the full tax-free allowance of 400,000 euros to a mother who had donated a property in Germany to her daughters but lives in the UK.