Forward-looking estate planning is the most effective way to transfer assets to the next generation securely and to avoid conflicts in the event of succession. I advise private individuals and businesses on the drafting of wills, gifts and the structuring of business successions – in particular in cross-border situations with a German-Italian dimension.

The choice of applicable law under the EU Succession Regulation, taking into account forced heirship rights in both countries and tax optimisation are central advisory areas. Arrangements made in good time open up planning opportunities that no longer exist once succession has occurred.

Estate planning in Italy

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The will is the central instrument of estate planning. In a German-Italian context, the choice of testamentary form is closely linked to the applicable law – and formal validity is governed by the generous alternative connecting system of the Hague Convention of 1961.

The three testamentary forms under Italian law

Revocation and amendment

A will may be revoked at any time – by a subsequent will of any form or by a notarial act of revocation. A holograph will may also be revoked by destruction; merely reclaiming it from fiduciary deposit is not sufficient for this purpose. Where a holograph will is to be completely revoked, the express clause „Revoco ogni mia precedente disposizione testamentaria" in the new will is advisable.

Publication and searching after death

For a holograph will, administration of the estate begins with its publication: a notary draws up a public protocol in the presence of two witnesses, into which the full text of the will is incorporated. The will may then be executed. If heirs are unsure whether a will exists, they may make an enquiry with the Consiglio Notarile Distrettuale using the death certificate; a cross-border search is also possible through the Registro Generale dei Testamenti in Rome.

What is not permitted in Italy

Recommendation: Anyone with assets in both countries should consider whether two coordinated wills (one for the German estate, one for the assets situated in Italy) are more practical than a single universal will – in order to simplify the notarial administration in both countries.

The EU Succession Regulation (EU No. 650/2012, in force since 17 August 2015) has fundamentally reformed private international succession law in Europe. It applies universally – including to non-EU citizens habitually resident in a participating Member State.

The general rule: law of the last habitual residence

Without an express choice of law, the law of the state in which the deceased had their habitual residence at the time of death applies (Art. 21 EU Succession Regulation). What matters is a close and stable centre of life – not mere registration of address. The applicable law governs the entire estate, including immovable property situated in other EU Member States: the earlier split between moveable and immoveable property has been overcome.

Choice of law under Art. 22 EU Succession Regulation

A person holding the nationality of another state may, by testamentary disposition, choose the law of that state to govern their succession. The choice must refer to the law of the nationality held at the time of the choice or at death – a free choice among any legal system is not permitted. In the case of dual nationality (e.g. German-Italian), one of the nationalities concerned must be chosen.

The choice of law must be declared expressly in a testamentary disposition – or follow unambiguously from its clauses. It may be revoked at any time and should be reaffirmed in every will. A partial choice of law for individual assets is not permitted.

Strategic considerations for the choice of law

Practical note: The choice of law is not a blank cheque. A choice of German succession law does not provide protection against the obligation under Italian law to file a dichiarazione di successione, to have wills published notarially, and to retitle real property in the catasto. Procedural law (procedura) and conflict of laws (sostanza) operate in parallel.

Inter vivos gifts can be an effective instrument for anticipatory succession. They must, however, be structured securely and analysed for their impact on the forced share and on inheritance and gift tax.

Formal requirements for gifts in Italy

Gifts of immoveable property or substantial assets must under Art. 782 c.c. be made by public instrument (atto pubblico) before a notary in the presence of two witnesses. This formal requirement applies on pain of nullity. An exception applies to gifts of low-value moveable assets completed by immediate delivery (donazione di modico valore).

Donazione con riserva di usufrutto

A particularly common arrangement is the gift with reservation of usufruct: the donor transfers the nuda proprietà (bare ownership) to the recipient and reserves a lifetime right to use the property and draw fruits (e.g. rental income). The riserva di usufrutto may also be structured in sequence: first in favour of the donor, and after their death in favour of the surviving spouse. Note that the value of the donated nuda proprietà also enters into the riunione fittizia (forced share calculation).

Donazione indiretta – indirect gift

An indirect gift arises where a parent pays the purchase price for a property acquired in the child's name. Legally it remains a sale – the gift consists in the economic benefit to the child. This arrangement is not subject to notarial certification of the gift itself. It is advisable, however, to declare the origin of the purchase price in the deed of sale: for reasons of tax transparency, clarity in succession law (for the riunione fittizia) and – following recent Court of Cassation case law – to reduce the risk that the indirect gift is apparent to third-party acquirers from the land register.

Gifted properties and marketability

Gifts can restrict the marketability of the gifted property because forced heirs (legittimari) may subsequently bring the azione di riduzione and, if applicable, the azione di restituzione against third-party acquirers. The risk profile depends on four factors:

As additional protection, insurance policies are increasingly used to indemnify acquirers and financing banks against the financial risk of a successful restitution claim.

Note: Gifts no longer reduce the inheritance tax exemptions of the heirs in Italy – the coacervo successorio has been abolished. For gift tax itself, however, prior gifts between the same parties are cumulated (coacervo) – the exemptions apply only to the remaining unused amount.

Succession to business interests or family companies with a German-Italian dimension combines succession law, corporate law and tax questions. Early planning is particularly important here, as the death itself can cause operational paralysis in the business.

The patto di famiglia – business succession during the owner's lifetime

The patto di famiglia (Art. 768 bis ff. c.c.), anchored in Italian law since 2006, allows an entrepreneur to transfer their business or company shares during their lifetime to one or more successors – without those assets subsequently being subject to the forced share. Requirements:

Tax relief for business succession

The transfer of businesses and company shares to descendants and spouses – upon death or by gift, including by way of a patto di famiglia – is exempt from inheritance and gift tax (Art. 3(4-ter) D.Lgs. 346/1990), provided that:

For real property forming part of the business assets, the tax exemption extends also to imposta ipotecaria and catastale.

Succession law issues with company shares

The death of a shareholder has different consequences depending on the legal form. In a S.r.l. (equivalent to a GmbH under Italian law), shares can in principle pass to the heirs – unless the articles of association contain a clausola di gradimento or clausola di continuazione limitata. In a S.n.c. (equivalent to an OHG), the death of a partner without special provisions leads to dissolution of the company. Forward-looking drafting of the articles is therefore just as important as testamentary arrangements.

Note: The patto di famiglia is restricted to businesses and company shares – real property, cash or securities cannot be its subject matter. For the anticipatory transfer of real property, the gift (if applicable with riserva di usufrutto) remains the appropriate instrument.

In a German-Italian succession, inheritance and gift tax liabilities may arise in both countries. Since there is no double taxation agreement, forward-looking tax planning – ideally during the testator's lifetime – is essential.

Italian inheritance and gift tax

The imposta sulle successioni e donazioni (D.Lgs. 346/1990) applies uniformly to both succession and gifts – with the same exemptions and rates:

For real property, Imposta ipotecaria (2%) and Imposta catastale (1%) apply additionally – without exemptions. Where the primary residence relief (agevolazione prima casa) applies, a flat amount of €200 each applies instead.

Exemption optimisation through lifetime gifts

In Italy, the €1,000,000 exemption per parent and child may be utilised through phased gifts. The coacervo must be noted: prior gifts between the same parties are set against the exemption. The good news: in the succession itself, the coacervo successorio has been abolished – gifts received during lifetime do not reduce the inheritance tax exemptions of the heirs.

In Germany: gift tax exemptions may be used again every 10 years (§ 14 ErbStG). Long-term, phased gift planning can substantially reduce the German tax burden.

Avoiding double taxation

There is no double taxation agreement between Germany and Italy in the area of inheritance and gift tax. Relief is provided by the tax credit under § 21 ErbStG: the tax paid in Italy on the same assets is credited against the German tax – but only up to the amount of the German tax attributable to the assets situated abroad. Complete elimination of the double burden is not always achievable by this route.

Dichiarazione di successione – new autoliquidazione from 2025

The dichiarazione di successione must be filed online within 12 months of the death – even where no tax is due (otherwise retitling of real property is not possible). For deaths from 1 January 2025 onwards, the heir calculates and pays the inheritance tax themselves (autoliquidazione, Quadro EF-EF18bis) upon filing the return; for earlier deaths, the assessment is made by the tax authority.

Practical tip: Tax optimisation does not begin at the point of succession. Targeted gift planning utilising the exemptions in both countries, combined with a choice of law under Art. 22 EU Succession Regulation and testamentary arrangements, can substantially reduce the overall burden. Individual analysis is essential.

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Plan your estate early

Whether will, choice of law, gift planning or business succession – timely and precise planning protects your assets and your family. I advise you confidentially on all matters of estate planning with a German-Italian dimension.

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