Transfer during one’s lifetime.

As at: June 2026

The answer first. A transfer during one’s lifetime can create clarity and avoid later conflict — provided that your own security is settled first. And it is one path among several: keeping the house and arranging the succession in a will is a solution of equal standing. What suits you is decided by your situation, not by a rule of thumb.

You decide who receives the house, at what point in time and under what conditions. That takes later inheritance disputes out of play and turns the transition into an active decision rather than an emergency. Whoever transfers during their lifetime can also settle what remains attached to the house: a right of residence or a usufruct for yourself, a balancing arrangement among siblings, clear duties for the next generation. All of this is set down in a transfer deed — discussed within the family, notarised at the notary’s office.

A transfer is not a must. Whoever keeps the house and arranges the succession in a will has made provision just as well — and remains free, to the very end, to decide differently. Keeping and transferring are paths of equal standing; a combination is also possible, for instance transferring only a share. Which arrangement carries best only becomes clear once the whole picture is on the table: your own provision, your family, the value of the house, your wishes.

Three ten-year periods surround a transfer during one’s lifetime. They are no instrument of pressure — but a reason to plan early and calmly. Whoever knows them understands why professionals speak so often of putting things in order early.

First: gift tax (sections 14, 16 of the Inheritance and Gift Tax Act, ErbStG). Every child may receive assets of up to €400,000 from each parent free of gift tax every ten years. The period starts afresh with every gift. Whoever transfers early can therefore use the allowance more than once — with a couple and two children, considerable assets can pass tax-free over the years. That is the tax reason why transfers often take place long before the inheritance.

Second: the compulsory-share supplement (section 2325 of the Civil Code, BGB). Gifts made within the last ten years are counted proportionately towards the compulsory share of close relatives — reduced by one tenth for every full year since the gift. Important to know: where the givers reserve a usufruct for themselves, settled case law holds that this period regularly does not begin to run at all. Precisely such interactions belong on the table before notarisation — with a lawyer or at the notary’s office.

Third: reclaiming a gift on impoverishment (section 528 BGB). If the giver becomes impoverished within ten years — for instance because care costs exceed income and savings — the gift can be reclaimed; if the social-assistance authority steps in, it can take this claim over. That is not a question of blame and no reproach to the family, but the law as it stands: one’s own assets are to serve one’s own provision before the public purse steps in. For planning, this means soberly: whoever transfers calculates their own provision first — and knows that the first ten years are a period in suspense.

Whoever transfers should know that housing and provision are secured. Two reservations have proven themselves. The right of residence secures your own living in the house — entered in the land register and thus effective against every later owner. The usufruct goes further: it additionally permits drawing income, for instance letting the house should your own living there one day end. Both reservations also reduce the taxable value of the gift, because the house passes encumbered — which often eases the pressure on the allowance noticeably. Added to this come reclaim clauses for defined events: for instance if the child dies before the parents, wishes to sell the house without consent, or runs into insolvency or divorce. Which clauses make sense is a matter of drafting for the notary’s office; the tax effect is examined by a tax adviser. More on both rights: Right of residence and usufruct.

A transfer of real property requires notarial form; the land registry demands publicly certified declarations (section 29 of the Land Register Code, GBO). That protects you: the notary satisfies herself that you understand what you are declaring and that you want it freely. But it also means: no one can take this decision off your hands — and no one can make it up for you later, should you one day no longer be able to decide yourself. Whoever puts things in order in good years keeps their hand on events and spares the family the slow detour via the guardianship court. That is no cause for worry, but an expression of sovereignty: you shape things as long as the shaping lies entirely with you.

Taxes, questions of the compulsory share and your own later liquidity all need to be considered — as does the balance among siblings, for an unequal transfer without a clear arrangement sows the later conflict. The law is clarified by a lawyer or the notary’s office; taxes by a tax adviser. Our task is that the whole picture lies on the table in good order, that the family carries the path together and that no one feels passed over.

Back to the overview: Right-sizing your home · on to Right of residence and usufruct.

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This article provides orientation and does not replace legal or tax advice. The law is clarified by a lawyer or the notary’s office; taxes by a tax adviser.