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German Tax Law

German ProbateGerman Succession & Inheritance LawGerman Tax Law

Careful with Deed of Variation if Estate comprises Foreign Assets

Using a Deed of Variation in the UK may cause additional Taxes Abroad Let's take an easy example: An English testator owns property or a significant investment in Germany, which already triggers German inheritance tax, even if neither the legator nor the beneficiaries are resident in Germany. He has two children and gives the German house (or flat) to child 1, the German investment to child 2. For whatever reasons, the children prefer a different…
Bernhard Schmeilzl
June 1, 2016
German Succession & Inheritance LawGerman Tax Law

The Perils of German Inheritance Tax and Gift Tax

German Inheritance Tax applies when British Legators (and their Lawyers) least expect it UK and US lawyers are used to an inheritance tax regime where (only) the estate as such is being taxed. Within that system, it does not matter too much who the beneficiary is and where he or she is domiciled. The German Inheritance Tax concept, however, works entirely differently (basics explained here). Instead of taxing the estate itself, it taxes each individual…
Bernhard Schmeilzl
March 22, 2016
German ProbateGerman Succession & Inheritance LawGerman Tax Law

Don’t be afraid of Clients with Foreign Assets!

Crash Course for UK Inheritance Lawyers: Will Preparation for International Families and Expats. Obtaining Foreign Probate Solicitors working in the field Wills & Probate, sooner rather than later, are faced with clients who own foreign assets, are married to non-British spouses or are sent abroad as expats by their employers. These international clients, in most circumstances, will rely on their Will to also cover their non-UK assets and to function in foreign jurisdictions, i.e. the…
Bernhard Schmeilzl
October 20, 2015
German ProbateGerman Succession & Inheritance LawGerman Tax Law

International Wills and Estate Planning for British-German Families

... and the big misunderstanding regarding the "choice of inheritance (tax) law" Drafting a Will is no easy matter. It gets even more complicated if you are a mixed-nationality family, if you have assets in more than one country or if you have more than one residence. This posting explains the basic rules of estate planning for British-German spouses or families. With international inheritance cases and estate planning one must always strictly distinguish between two…
Bernhard Schmeilzl
July 24, 2015
Business in GermanyBusiness Tax & Fiscal ObligationsGerman Corporate LawGerman Labor LawGerman Tax LawStarting BusinessStarting or Expanding Business

When starting a Business in Germany: Don’t Forget the Trade Register Notification (Gewerbeanmeldung)

Your new German company is finally registered? Gratulations! But you are far from being done. Under German law (see section 14 Gewerbeordnung, i.e. German Trade Regulation), the commencement of a business activity must be notified in writing (Gewerbeanmeldung) to the local Ordnungsamt (Trades Office), which is a department of the municipal government, for example the city of Munich. This notification obligation also applies to any change in the business (e.g. move, modification to the nature…
Bernhard Schmeilzl
October 31, 2014
German LawGerman ProbateGerman Succession & Inheritance LawGerman Tax Law

Not only German Grant of Probate …

... is necessary for a foreign beneficiary to be able access the German estate. In addition to a Certificate of Inheritance (details here) the banks, insurance companies or other third parties that hold assets of the deceased will demand to see a Certificate of Non-Objection or Tax Clearance Certificate (in German called "Unbedenklichkeitsbescheinigung") issued by the German Tax authorities (Finanzamt). The reason for this is that according to Section 20 para. 6 German Inheritance Tax…
Bernhard Schmeilzl
September 23, 2014
Business in GermanyGerman Labor LawGerman Tax LawStarting Business

Beware of the horrid Monster of German Labour Law: Ficticious Self-Employment

The biggest fear of any German HR department: Having covert salary employees among their workforce German labour law is strictly regulated and employees are well protected against dismissal if the employer’s workforce exceeeds 10 full time employees (details here). Furthermore, German wage tax (Lohnsteuer), health insurance, social security and state pension contributions are rather hefty (for more see here: Statutory Pension Insurance in Germany). Therefore, to try to avoid these labour costs, some employers but…
Bernhard Schmeilzl
July 24, 2014
Business in GermanyBusiness Tax & Fiscal ObligationsGerman Corporate LawGerman Labor LawGerman Tax LawStarting BusinessStarting or Expanding Business

London Chamber of Commerce: 10 practical tips for doing business in Germany

In this issue of „London Business Matters“, the London Chamber of Commerce's monthly magazine, German corporate and business lawyer Bernhard Schmeilzl has compiled "10 Top Tips when starting a Business in Germany". The magazine also contains helpful information about the trading relations between the UK and Germany. Just browse the online issue. For more details on how to establish a business in Germany please see the articles below 3 Ways to expand your Business to…
Bernhard Schmeilzl
July 23, 2014
German ProbateGerman Succession & Inheritance LawGerman Tax Law

Can foreign Taxes be set off against UK Inheritance Tax?

Unilateral Inheritance Tax Relief in British-German Probate Matters If a legator was domiciled (or legally deemed to be domiciled) in the UK and possessed assets in other countries, then HMRC will levy inheritance tax on the entire estate, i.e. all assets worldwide (see here). The problem is: Other jurisdictions may employ an entirely different inheritance tax system and also demand inheritance tax. Germany, for example, does not use domicile but citizenship (nationality) and residency to…
Bernhard Schmeilzl
July 4, 2014
German ProbateGerman Succession & Inheritance LawGerman Tax Law

How to apply for a German Grant of Probate

First, you need to make the right choice about which German Grant to apply for The German equivalent of a UK Grant of Probate is the Certificate of Inheritance (Erbschein). Less common is its “little brother”, the Certificate of Executorship (Testamentsvollstreckerzeugnis). Both documents are issued by the Nachlassgericht which is the probate department of the respective local District Court (Amtsgericht). Who needs an Erbschein? As we have explained here, German law applies the principle of…
Bernhard Schmeilzl
June 30, 2014