In which cases can a tax exemption be requested for inheritance tax?
April 12, 2024 | 40,00 EUR | answered by Alwin Widmann
Dear tax consultant,
My name is Isabel Pilz and I am currently facing the challenge of dealing with inheritance tax, as I recently inherited an estate. I am unsure whether and in which cases an exemption from inheritance tax can be requested.
The current situation is as follows: I have inherited a property from my aunt and I am now wondering whether I have to pay inheritance tax for it. Since I do not have extensive knowledge of tax law, I am worried that I may have to pay high taxes that could affect my financial situation.
Therefore, I would like to know from you under which circumstances an exemption from inheritance tax can be requested. Are there specific requirements or criteria that need to be met in order to benefit from a tax exemption? What documents or evidence are required for this and what is the process of applying for the exemption?
I would be very grateful if you could provide me with detailed information on this matter, so that I can better orient myself and take appropriate steps to potentially take advantage of any tax relief available.
Thank you in advance for your support and advice.
Sincerely,
Isabel Pilz
Dear Mrs. Pilz,
Thank you for your inquiry regarding inheritance tax and the possibility of a tax exemption. I am happy to provide you with detailed information on this matter.
First of all, it is important to know that in Germany, inheritance tax is levied on the acquisition of assets through inheritance or gift. However, there are certain tax-free allowances that vary depending on the degree of relationship to the deceased. As the niece of your aunt, you have a tax-free allowance of 20,000 euros. This means that you can inherit up to this amount without paying any tax.
In your case, where you have inherited a property, it may be that the value of the property exceeds the tax-free allowance, resulting in inheritance tax being due. However, there are various ways to obtain a tax exemption. For example, owner-occupied properties can be inherited tax-free under certain conditions. So if you plan to use the inherited property yourself, this could be an option to save on taxes.
Furthermore, there are also tax-free allowances for specific purposes such as education or initial setup costs for children. Donations to charitable organizations may also be tax-deductible.
To apply for a tax exemption in inheritance tax, certain conditions must be met. For example, the heir must prove that they meet the requirements for a tax exemption (e.g. owner-occupancy of the property). This requires relevant documents such as land registry extracts, lease agreements, or other proof.
The process of applying for a tax exemption can vary depending on the case. Generally, an application for a tax exemption must be submitted to the relevant tax office. The documents will be reviewed and a decision on the tax exemption will be made.
It is advisable to seek advice from a tax consultant in your specific case to explore potential tax-saving opportunities and facilitate the application process.
I hope that this information has been helpful to you. If you have any further questions, please feel free to contact me.
Best regards,
Alwin Widmann
