Gift tax calculator (Germany)

How German gift tax works

German gift tax (Schenkungsteuer) applies when assets are transferred during the donor's lifetime and the personal allowance is exceeded. Three factors determine the result: the allowance by degree of kinship (Section 16 ErbStG), the tax class (Section 15 ErbStG) and the tax rate on the taxable acquisition (Section 19 ErbStG).

Allowances by degree of kinship

One property is easy to miss and decisive: the allowance applies per donor and per recipient. Father and mother each have their own allowance towards each child, so a couple can transfer up to EUR 800,000 to one child tax-free, EUR 400,000 from each parent. The calculator models this through the number of donors.

The 10-year window

The allowance renews every ten years. Whoever starts early can use it several times: a gift today and another in ten years use two full allowances.

Within ten years, gifts from the same donor are combined under Section 14 ErbStG. The current-law tax on earlier gifts is deducted from tax on the combined acquisition, with a minimum of tax on the new gift alone and a cap of 50% of the new gift. A EUR 500,000 earlier gift and EUR 100,000 new gift to a child give EUR 22,000 combined tax minus EUR 11,000 prior-gift tax: EUR 11,000 due. The calculator assumes equal shares across donors and the same relationship; a higher actual earlier tax payment is not an input.

How the calculator works

The rate depends on the tax class and the size of the taxable acquisition: in tax class I it rises in steps from 7% (up to EUR 75,000) to 30%, in class II from 15% to 43%, in class III from 30% to 50%. Each rate applies to the entire taxable amount; near bracket boundaries the calculator applies the hardship adjustment of Section 19(3) ErbStG.

In optimization mode the calculator also shows how a larger total transfer can be split into allowance-sized tranches on a ten-year rhythm, and how much tax that staging saves compared with a lump-sum transfer.