Transferring property during one's lifetime

One thing is almost always inevitable with real estate: inheritance disputes. This can be avoided even before death by making a gift. If relatives are to be excluded from the inheritance or if children are to be spared excessive inheritance taxes, this can also be achieved by transferring the property. But what are the key considerations?

As with a sale, the property is transferred to the beneficiary via a notarized deed of gift. Owners should seek advice from a notary or lawyer beforehand. A local real estate agent can use their network to help find a legal expert.

Making a gift conditional

Life can always throw you a curveball, and you might need to reclaim your property for financial reasons. Alternatively, you might want to ensure the property remains securely within the family after your death. These and other conditions should be stipulated in the contract. Typically, the contract includes a right of residence, which is registered in the land register. Here are some examples of other conditions that can be agreed upon:

• Obligation to care for the donor (also to protect against revocation by the state in case of need for care)
• Revocation of gift
• Prohibition of letting, reselling, etc.
• Disbursement of a sum of money

All agreements should always be precisely described. In the case of a care obligation, this includes the recipient's duties and cost responsibilities. In the case of a revocation, this includes all reasons that would lead to the return of the property.

Type of gift

Each child has a tax-free allowance of €400,000. This can be claimed every ten years. If both parents are registered in the land register, the allowance increases to €800,000, as both can utilize the allowance for the child. Whether a gift is made in stages or as a series of gifts depends on the property's value. This can be determined by a local real estate agent.

If there are several children, nieces, siblings, or other relatives who will later inherit, an agreement can be made with them to waive their right to a supplementary compulsory share. This waiver is subject to compensation. The agreement must also be notarized.

Do you want to settle your real estate inheritance or have questions about buying or selling a property? We would be happy to assist you. Contact us.

Notes

For the sake of readability, this text uses the generic masculine form. Female and other gender identities are explicitly included where relevant to the statement.

This article does not constitute tax or legal advice for any specific case. Please consult a lawyer and/or tax advisor to clarify the facts of your individual situation.

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