Anticipated succession

In line with the saying "Giving with warm hands is better than with cold hands", many parents or grandparents transfer parts of their assets to their (grand)children during their lifetime. The future heir thus receives, for example, cash assets or real estate during the lifetime of the future testator. Even if the donee would inherit the donor and future testator anyway, there are several reasons for a (partial) transfer of assets during their lifetime, such as

In application of the saying "Giving with warm hands is better than with cold hands", many parents or grandparents transfer parts of their assets to their (grand)children during their lifetime. The future heir thus receives, for example, cash assets or real estate during the lifetime of the future testator. Even if the recipient would inherit the donor and future testator anyway, there are several reasons for a (partial) transfer of assets during their lifetime, such as

  • Dispute avoidance through transfers in agreement with the (grand)children, etc.

  • Securing the livelihood of the donee

  • Tax savings (use of allowances, possibly several times)

  • Relief for the transferor

  • Prevention of access by the social welfare provider in the event of a later need for care or a move to a care home

  • etc.

The transfer of real estate to (grand)children - as an anticipation of succession - often plays a particularly important role. The transferor then often retains a usufructuary right or a lifelong right of residence, which is intended to provide security in old age.

However, transferring larger assets to the future heir during their lifetime also has consequences. The transfer of assets reduces the subsequent estate value. The question then arises as to whether the later estate should be divided between the heirs according to their inheritance quotas, regardless of the gifts made during their lifetime, or whether the value of the gift must be taken into account in the estate distribution so that all heirs are ultimately on an equal footing in terms of value. Such questions may also arise in relation to potential claims to a compulsory portion or supplementary compulsory portion or their targeted minimization (supplementary compulsory portion claim). Therefore - depending on the donor's wishes - one of the following 5 solutions can be agreed:

  • gift subject to compensation

  • gift subject to offsetting

  • Gift subject to compensation and offsetting

  • Gift not subject to equalization or offsetting

  • Endowment

Each of the 5 solutions leads to different results at inheritance and compulsory portion level. Which path is the "right" one should therefore be clarified as part of a case-by-case consultation.

In general, a transfer during one's lifetime is not the right way for every future testator. For example, the specific (personal) composition of assets should always be kept in mind. For this reason, comprehensive advice on overall "estate planning" may be advisable and sensible.

The above explanation is intended to provide an initial insight into the topic of anticipated succession. It is not a substitute for advice in individual cases.

If you have specific questions or would like an assessment of your case, we will be happy to provide you with an initial consultation at any time. The costs of such a consultation amount to a maximum of EUR 190.00 plus VAT. The length of the consultation and the size of your assets are irrelevant.

Status: 19.07.2023