German Expats: Inheritance Tax Home

Start with the UAE side, because it is the simpler half. The UAE levies no inheritance tax, no estate tax and no gift tax on individuals: when a German expat dies holding Dubai property, UAE bank accounts or business interests, no UAE death tax falls due on the estate. That single fact surprises many newcomers, but it does not mean the estate passes smoothly. Succession - who gets what - is a separate question from taxation, and in the UAE it is governed by personal-status law unless a registered will says otherwise. For Muslim expats, Sharia-based succession applies with fixed heir shares; non-Muslims can register wills with the DIFC Wills Service Centre for Dubai assets or the ADGM wills registry, choosing the law of their nationality for succession. Without a registered will, the estate goes through the UAE courts under default rules, which can be slow and may not match the family's expectations. Practical consequences follow immediately: UAE bank accounts can be frozen on notification of death, jointly held Dubai property passes under local property rules, and business licences need succession handling before they can be transferred or renewed. Home-country rules below are general information only - confirm with qualified local counsel in Germany before acting on them. The key takeaway: the UAE gives you a zero-tax canvas, but you still need a will the UAE courts will respect. Joint ownership with a spouse does not bypass succession procedure in the UAE: jointly held Dubai property still needs the succession documents to retitle the deceased's share, and the surviving owner's rights depend on how title was registered. Check the title deed wording now, not after a death.

Germany levies Erbschaft- und Schenkungsteuer at 7-50% depending on the tax class (relationship) and amount, with personal allowances (EUR 400,000 per child, EUR 500,000 for spouses, among others). Gifts and inheritances aggregate over ten-year windows. Germany also imposes Wegzugsteuer (exit tax) on substantial shareholdings when residence ends. The expat question is whether that treatment follows you to Dubai. In most systems the answer turns on residence and domicile at death, not on citizenship alone: German nationals who have genuinely broken Germany tax residence are generally outside the Germany death-tax net for non-Germany assets, while those still resident - or domiciled, in systems where domicile matters - remain inside it for worldwide assets. This is where Dubai-based families get hurt: they assume the UAE's zero death tax travels with them, when the home country's claim travels with residence instead. Establishing where you were tax resident at the relevant date is therefore the first analytical step, before any discussion of rates. Home-country rules below are general information only - confirm with qualified local counsel in Germany before acting on them. Domicile and residence are different concepts, and the distinction decides cases: residence is about where you live now, domicile about where your permanent home is in law. Several systems - most famously the UK's - tax on domicile long after residence has ended. Know which concept your home country applies to death taxes.

7-50% by class and value after allowances; business-asset reliefs can sharply reduce the bill for qualifying business property. Rates alone never tell the full story: allowances, exemptions and valuation rules decide most real bills. Two features deserve attention in almost every system. First, the allowances usually matter more than the headline rate - spouse and child exemptions, per-beneficiary thresholds and business or agricultural reliefs routinely eliminate the tax for ordinary family estates. Second, gifts made during lifetime often aggregate with the estate (look-back windows of several years are common), so deathbed transfers rarely escape the net. Home-country rules below are general information only - confirm with qualified local counsel in Germany before acting on them.

There has been no Germany-UAE double tax agreement since the 2010 treaty expired on 31 December 2021, and no inheritance tax treaty ever existed. Most UAE double tax agreements are income-tax treaties: they allocate taxing rights over dividends, interest, royalties, employment and business income, but they say nothing about estate, inheritance or gift taxes. A small number of bilateral arrangements worldwide carry separate estate-tax articles, but Germany and the UAE have never had one, and their income tax treaty lapsed at the end of 2021. That leaves succession taxation to each country's domestic law: the UAE taxes nothing, and Germany taxes what its domestic law claims. Without a treaty there is also no tie-breaker: if the deceased or the heir kept a German residence or habitual abode, or is a German national within five years of leaving, Germany can tax the whole worldwide estate. Home-country rules below are general information only - confirm with qualified local counsel in Germany before acting on them. Where both countries claim death taxes on the same assets, relief is thinner than for income tax: few treaties cover estate taxes, and unilateral foreign-tax credits for death duties are patchy. This is why the residence-at-death analysis comes before any rate discussion.

UAE assets follow UAE succession procedure even when the deceased was German. Dubai real estate transfers to heirs through the Land Department on production of a succession certificate or probated will - no transfer tax applies, but the paperwork must be right. UAE bank accounts are typically frozen when the bank learns of the death; release requires a court-issued succession certificate or equivalent, which is why families should know which court has jurisdiction before they need it. Business interests are the messiest category: trade licences do not transfer automatically, free zone authorities have their own succession procedures, and a deadlocked company can bleed value while heirs argue. Life insurance with named beneficiaries usually bypasses the estate, which is why beneficiary designations are reviewed in every serious plan. Home-country rules below are general information only - confirm with qualified local counsel in Germany before acting on them. Cross-border bank practicalities deserve their own checklist: notify each bank in the right order, expect freezes, and keep at least six months of family expenses in an account the surviving spouse can actually access. Probate on investment platforms follows the platform's domicile rules, which may differ from both countries'.

The ten-year aggregation makes lifetime gift planning a long game; Berliner Testament structures are standard for spouses. Coordinate a Dubai will with German succession advice, and model the Wegzugsteuer before deregistering if substantial shareholdings exist. Beyond the will itself, four practical steps complete the plan. First, align beneficiary designations - insurance policies, pension nominations and investment-account beneficiaries - with the will, because designations usually override wills. Second, consider lasting powers of attorney for incapacity, not just death: a coma without a POA freezes everything as surely as death. Third, keep an asset register - every account, property and policy in both countries, updated annually. Fourth, tell two people where everything is: the best-drafted plan fails if nobody can find it. Home-country rules below are general information only - confirm with qualified local counsel in Germany before acting on them.

Every row in this table comes from real files: families who discovered the problem at the worst possible moment. The pattern is consistent - the tax analysis was done, but the succession mechanics were not. Work through the table once, fix what applies, and calendar a review every two to three years or after any major life event. Digital assets need explicit succession handling: crypto exchange accounts and self-custody wallets do not pass through normal probate discovery. Leave a sealed memorandum with access instructions (never seed phrases in a will, which becomes a public document) and name a technically competent executor for digital holdings.

Get advice before the estate exists, not after. The moments that trigger a review are predictable: buying Dubai property, having children, receiving an inheritance yourself, moving back toward Germany, or accumulating assets that cross the home-country exemption thresholds. A cross-border succession review maps your UAE position - will registration, asset titling, beneficiary designations - against a properly caveated Germany picture prepared with local counsel, so both wills, the nominations and the asset register tell the same story. It is fixed-scope and plain-language, built for families rather than tax departments. Book it before the next property purchase or family milestone, because succession planning done under time pressure is where the expensive errors creep in. Home-country rules below are general information only - confirm with qualified local counsel in Germany before acting on them. Review the plan after every major life event - marriage, divorce, children, property purchases, large gifts, or a move back toward home. An unreviewed ten-year-old will is one of the most common causes of estate disputes in expat files.

Succession planning that only considers death misses half the picture: lifetime gifts and trust structures move wealth earlier, often more tax-efficiently. Many Germany systems tax gifts alongside inheritances - sometimes at the same rates, sometimes with separate allowances - and look-back windows pull recent gifts back into the estate. The UAE side is permissive: no gift tax, and DIFC/ADGM foundations plus trust structures offer formal vehicles for holding Dubai assets for family purposes, with governance that survives the founder. The catch is recognition: a Dubai foundation is a UAE creature, and Germany may treat it as transparent, as a separate taxpayer, or not recognise it at all. Home-country rules below are general information only - confirm with qualified local counsel in Germany before acting on them. Never assume a structure that works in Dubai works at home.