💰 Germany Inheritance Tax (Erbschaftsteuer) Calculator

Erbschaftsteuer is the German tax on inherited assets. It is governed by the Erbschaftsteuer- und Schenkungsteuergesetz (ErbStG) and applies to everything a person receives by way of inheritance, whether cash, real estate, company shares or household goods. What makes the German system distinctive is that the tax burden depends almost entirely on who inherits, not just how much: the law sorts heirs into three tax classes and pairs each class with its own tax-free allowance and its own progressive rate schedule.

The allowances are generous for close family and minimal for everyone else. A surviving spouse may receive 500,000 euro tax-free, each child 400,000 euro, a grandchild 200,000 euro and a parent 100,000 euro. Siblings, nieces, nephews and divorced spouses get only 20,000 euro, and all other recipients - friends, unrelated business partners - also receive just 20,000 euro free of tax. Because the allowance is deducted before any rate is applied, many modest estates to close family pay nothing at all. The inheritance tax is settled through the German income tax framework only in the narrow sense that both are federal taxes; the calculator here models the ErbStG rules directly, and the sibling levy on investment returns can be seen in the capital gains tax tool.

Tax class I covers spouse, children, grandchildren and parents; class II covers siblings, nieces, nephews, grandparents and divorced spouses; class III covers everyone else. Each class then climbs through seven brackets from a low of 7% (class I on the first 75,000 euro) up to 50% (class III above 26 million euro). The calculator below works out the allowance automatically from the relationship you select, subtracts it, and applies the correct bracket sequence.

Three inputs drive every result: the relationship (which sets both the tax class and the allowance), the gross inherited amount, and any prior taxable gifts to the same person in the rolling ten-year window. The core steps are:

1. Taxable base = inherited amount - allowance - prior taxable gifts. If this is zero or negative, no tax is due and the tool says so. 2. Progressive tax. The taxable base is run through the seven-bracket schedule for the relevant class - each portion of the base is taxed at its own marginal rate, so the result is always less than a flat rate applied to the whole amount. 3. Effective rate. The tool also reports the effective rate (total tax divided by the taxable base) so you can compare the real burden against the top statutory rate.

Worked example: a child inherits 500,000 euro from a parent. The class-I allowance is 400,000 euro, leaving 100,000 euro taxable. The first 75,000 euro is taxed at 7% (5,250 euro) and the remaining 25,000 euro at 11% (2,750 euro), for a total of 8,000 euro - an effective rate of 8% on the taxable portion. A useful derived figure is the post-tax inheritance: 500,000 - 8,000 = 492,000 euro actually kept.

The allowance is deducted from the inherited amount before any rate applies. It depends only on the relationship, not on the size of the estate.

Each portion of the taxable base is taxed at its own bracket rate. The table shows the marginal rate for each band of taxable inheritance.

Rates are applied per bracket, so the effective rate is always below the top marginal rate shown.

1. Select the relationship to the deceased - this automatically sets the tax class (I, II or III) and the matching tax-free allowance.
2. Enter the gross inherited amount in euro (cash, property value, shares or their combined total).
3. If the same person already received taxable gifts from the deceased within the last ten years, enter that prior taxable amount so the allowance is reduced correctly.
4. Click Calculate to see the allowance, the taxable base, the progressive tax and the effective rate.
5. Read the post-tax inheritance figure and, for large or cross-border estates, take the estimate to a Steuerberater for a binding assessment.

What are the 2026 tax-free allowances for German inheritance tax?

Allowances are set by tax class and relationship, not by the size of the estate: spouse 500,000 euro, each child 400,000 euro, grandchild 200,000 euro, parent 100,000 euro, and sibling / niece / nephew / divorced spouse / other recipient 20,000 euro. The allowance is deducted before any rate is applied, so many close-family estates pay no tax at all.

How progressive are the inheritance tax rates?

Each tax class has seven brackets. Class I runs 7% (first 75,000 euro) up to 30% above 26 million; class II runs 15% to 43%; class III runs 30% to 50%. Because each bracket is taxed separately, the effective rate is always well below the top marginal rate - a child with 100,000 euro taxable pays 8,000 euro, an 8% effective rate.

Does the ten-year gift rule affect inheritance tax?

Yes. Gifts and inheritances to the same person share one rolling ten-year allowance under ErbStG. A taxable gift made within ten years of the death reduces the allowance still available on the inheritance, and after ten years the gift "drops out" and the full allowance resets. The gift tax tool models the same schedule separately.

Is a surviving spouse really better off than a child?

For the allowance, yes: the spouse gets 500,000 euro free versus 400,000 for a child, and both sit in the favourable class I. Beyond the allowance the rates are identical, so the advantage is concentrated in the first 100,000 euro of extra headroom. A second marriage with children from a previous relationship is where the class differences bite hardest.

Do non-residents pay German inheritance tax?

Non-resident heirs are liable on German-situated assets, most importantly German real estate and certain German business holdings, even if they never lived in Germany. Bank accounts and foreign property are generally outside the German charge. Double-taxation treaties can limit or eliminate the German claim where the country of residence also taxes the same assets.

Is this calculator legally binding?

No. It applies the published 2026 ErbStG allowances and rate schedules for orientation only. Valuation of property and companies, charitable deductions, business relief (Verschonungsregelungen) and treaty issues are not modelled. For any binding figure consult the Finanzamt or a Steuerberater.

This tool is for informational purposes only and does not constitute financial advice. Consult a qualified financial professional for advice specific to your situation.

Always subtract the correct allowance first - most disputes arise from heirs assuming a flat percentage when in fact the first several hundred thousand euro are free. Check whether the deceased already made taxable gifts to you in the last ten years; those reduce the remaining allowance under the rolling rule modelled in the gift tax tool.

Real estate and company shares have special valuation rules (Bedurfsbewertung, the Erbschaftsteuer-Anpassungsgesetz) that can differ sharply from market value, so a professional valuation matters for large estates. The allowance is per recipient and per ten-year period, so splitting an estate across several heirs can keep each below the threshold.

Non-resident heirs are still liable on German-situated assets (especially German real estate), and the treaty network may affect double taxation. Finally, several federal states have discussed supplementary wealth taxes, so confirm the current position before relying on the figure for planning.