For German-Italian estate matters, structured planning is essential: the EU Succession Regulation, different forced heirship systems and the absence of a double taxation treaty make individual solutions necessary. This checklist gives you an overview of the key steps in legally sound estate planning with an Italian dimension.

Alessandro De Maria – Rechtsanwalt
Alessandro De Maria
Rechtsanwalt & Avvocato stabilito
Curriculum Vitae ›
1

Taking stock: assets in Germany and Italy

Every estate plan begins with a complete inventory of assets – separated by country and asset class.

  • Real property in Italy: cadastral data, land register extracts, mortgage position, any history of gifts
  • Bank accounts and investment portfolios: in which countries, in whose name, with any powers of attorney
  • Company interests: SRL, SPA or other corporate forms in Italy; GmbH, KG etc. in Germany
  • Life insurance and pension plans: check beneficiaries – these often fall outside the estate
  • Existing gifts: documentation of all gifts (date, value, recipient) for subsequent forced share calculations

Practical tip: Prepare a structured asset summary and store it in a safe place – ideally together with the will.


2

Determining applicable law – choice of law under Art. 22 EU Succession Regulation

The EU Succession Regulation determines which inheritance law applies to the entire estate. The general rule is the law of the deceased's last habitual residence.

  • Residence in Germany: German inheritance law applies to the entire estate – including the holiday apartment in Sicily
  • Residence in Italy: Italian inheritance law applies – including the bank account in Frankfurt
  • Frequent changes or dual residence: particular caution required; habitual residence is determined by the centre of life
  • Making a choice of law: under Art. 22 EU Succession Regulation, any person may choose the law of their nationality – declare this expressly in the will

The choice of applicable law should be made strategically: which law offers greater freedom of disposition? Which forced heirship system is more favourable for the planned distribution? Are executors or inheritance contracts desired?


3

Choosing the form of will and making a will

The choice of form depends on the applicable law and the practical requirements of the estate plan.

  • Holographic will (D + I): written entirely by hand, dated, signed – simple and inexpensive but error-prone; no notary required
  • Public (notarial) will: highest legal certainty; in Italy: testamento pubblico before a notary and two witnesses; in Germany: notarial execution
  • Berliner Testament (Germany only): mutual will of spouses – not possible in Italy; useful for assets located in Germany where German law applies
  • Inheritance contract (Germany only): binds both contracting parties; not effective in Italy, but capable of recognition under the EU Succession Regulation if German law is chosen

Recommendation: Where there are cross-border assets, always have the will reviewed for compatibility with the foreign administration law – a formally valid German will may in practice be difficult to implement in Italy.


4

Providing for forced heirs

Both German and Italian law protect close relatives through inalienable minimum shares. These claims must be observed when drafting a will.

  • Under Italian law (legittima): 1 child: ½; ≥ 2 children: ⅔ together; spouse alone: ½; spouse + 1 child: ⅓ each; spouse + ≥ 2 children: ¼ + ½; parents (without children/spouse): ⅓
  • Under German law: children and spouse are entitled to half the statutory intestate share as a cash forced share
  • Assessment base in Italy (riunione fittizia): estate − debts + all lifetime gifts (without time limit) = assessment base for the legittima
  • Azione di riduzione: limitation period 10 years from the opening of the succession; directed first against heirs, then against donees (azione di restituzione)
  • Risk with gifted property: azione di restituzione against third-party purchasers lapses after 20 years from land register entry (Legge 80/2005) – unless an opposizione has been registered; where the donor has been deceased for more than 10 years, no residual risk remains
  • Beneficio di inventario: where the estate's liabilities are uncertain, consider accepting the inheritance with the benefit of inventory – this protects the heirs' personal assets from being merged with estate debts

Practical tip: Before any property purchase, check the date of land register entry for any gifted property in the portfolio. In practice, specialist insurance policies are increasingly used to protect buyers and financing banks against the economic risk of a subsequent restitution action.


5

Regulating estate administration and powers of attorney

Who takes on the administration of the estate in the event of death – particularly in a country where the heirs may not be resident?

  • Executor (Germany): appointed by the testator in the will; responsible for administration, settlement and distribution; not fully recognised as such in Italy – practical coordination required
  • Authorised representative for estate administration in Italy: notarial power of attorney (procura notarile) for bank accounts, tax matters, real property; may need to be apostilled and accompanied by a certified translation
  • Lasting power of attorney: regulates capacity to act in the event of incapacity already during one's lifetime; differently regulated in Germany and Italy – no automatic mutual recognition
  • Bank authorities: set up in good time before death; accounts without authority are frozen on death and accessible only on production of proof of entitlement

Practical tip: A notarial procura speciale in favour of a trusted lawyer or notarial representative resident in Italy can considerably accelerate the administration of the estate.


6

Tax optimisation: inheritance tax in Germany and Italy

Since there is no double taxation agreement between Germany and Italy for inheritance taxes, proactive tax planning is particularly important.

  • Exemptions in Italy: €1,000,000 for children/spouse (4%); €100,000 for siblings (6%); for other persons 8% without exemption
  • Exemptions in Germany: €500,000 for spouses; €400,000 for children; €200,000 for grandchildren; all usable again every ten years
  • Lifetime gifts: exemptions renewable every ten years (Germany) – stepwise transfer of assets possible in a tax-optimised manner
  • Credit under § 21 ErbStG: inheritance tax paid in Italy on foreign assets can be credited against German tax – but only partially and within limits
  • Business assets and real property: review special reliefs (business property relief in Germany; cadastral value assessment rules in Italy)

7

Storing and registering the will

A will is only useful if it can be found when the time comes. Both countries offer options for storage and registration.

  • Germany: custody with the local court (Nachlassgericht); entry in the Central Wills Register (Zentrales Testamentsregister) of the Federal Chamber of Notaries – automatic notification on death
  • Italy – public will: remains automatically with the executing notary and is registered in the Registro Generale dei Testamenti (Rome, Ufficio Centrale degli Archivi Notarili); internationally searchable through the Basel Convention
  • Italy – holographic will: fiduciary deposit with a notary is recommended; may also be entered in the Registro Volontario dei Testamenti (being introduced by the Consiglio Nazionale del Notariato) – enabling searches through any notary after death
  • Search request in Italy: if heirs or family members are uncertain whether a will exists, they may enquire with the Consiglio Notarile Distrettuale with the death certificate; a cross-border search is also possible through the Registro Generale dei Testamenti
  • International coordination: expressly inform heirs in both countries of the existence and location of the will – ideally through a note deposited together with the will
  • Regular updating: review the will on significant life events (marriage, divorce, birth of a child, acquisition/disposal of real property) and if necessary revoke and make a new one

Important: A later will generally revokes an earlier one. Where there are multiple wills (e.g. one for German assets, one for Italian assets), they must be consistent with each other and clearly delimited. A holographic will is revoked by destruction – merely withdrawing it from storage is not sufficient for this purpose.


8

Emergency planning: lasting power of attorney and advance care directive

Estate planning should be supplemented by provisions for the event that the person concerned is no longer able to make decisions during their lifetime.

  • Lasting power of attorney (Germany): authorises a trusted person to make financial and personal decisions; must be notarially or officially certified to be effective vis-à-vis land registries and banks
  • Statement of wishes regarding care (Germany): expresses wishes regarding a possible care supervisor (Betreuungsverfügung)
  • Amministratore di sostegno (Italy): the Italian institution of supported administration; a different person from a guardian; application to the court
  • Advance care directive: governed differently in Germany and Italy; draft one specific to each country for stays in both
  • Recognition in the other country: a German lasting power of attorney is not automatically effective in Italy – notarial confirmation and apostille may be required

Recommendation: Review powers of attorney and advance care directives regularly to ensure they are up to date, and store them appropriately in both countries. Inform the persons named of the content and location.

Planning your estate?

Want to structure your succession in a legally sound and tax-optimised way – with assets in Germany and Italy? I advise you individually on wills, choice of law, forced heirship and inheritance tax. Get in touch early.

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