When there is more than one heir, the estate belongs to all of them jointly as a community of heirs (Erbengemeinschaft). No heir owns individual items. Each owns a share of the whole estate, until the estate is divided.
Communities of heirs are common, for example between siblings or between a surviving spouse and the children. They are also a frequent source of disputes, especially when real estate is involved.
Managing the Estate
| Measure | Decision |
|---|---|
| Urgent measures, such as emergency repairs | each heir alone |
| Ordinary management, such as renting out a flat | majority by inheritance shares |
| Disposals, such as selling the house | all heirs |
Income, such as rent, belongs to the community and is generally divided when the estate is divided. Costs, such as property tax and repairs, are borne by the heirs in proportion to their shares.
Dividing the Estate
The goal of every community of heirs is to divide the estate (Erbauseinandersetzung). The steps are:
- Settle the debts of the estate.
- Agree on a division, ideally in a written agreement, notarised if real estate is involved.
- Implement it, for example by transferring property or dividing bank balances.
If the will contains instructions for the division, they must be followed. An executor can also carry out the division.
Inherited Property
Real estate is the most common source of conflict. Options include:
- One heir takes it over and pays the others their share.
- Joint sale and division of the proceeds.
- Continued joint ownership, for example renting it out, which requires good cooperation.
If the heirs cannot agree, any heir can apply for a partition auction (Teilungsversteigerung). The court auctions the property, and the proceeds are divided. Prices achieved at auction are often below market value, which is why a negotiated solution is usually better.
Land register. After the death, the heirs should be entered in the land register. This is free of charge if applied for within two years.
Tax. If the heirs sell the property, the deceased's period of ownership counts towards the ten-year period for tax-free capital gains. See selling real estate in Germany.
Selling Your Share
You can sell your share in the estate to a co-heir or a third party. The sale must be notarised. If you sell to a third party, the other heirs have a right of first refusal for two months.
Points for Expats
- Heirs in different countries. Signing documents from abroad requires notarised or certified signatures, often with an apostille. Powers of attorney can simplify the process.
- Bank accounts. Banks only release funds to all heirs together or with a joint instruction.
- Proof. The community usually needs a certificate of inheritance to act.
Frequently Asked Questions
Can one heir live in the inherited house?
Yes, if the other heirs agree. Otherwise, they may demand compensation for the use.
Can an heir block the sale forever?
No. Any heir can demand division and, if necessary, a partition auction.
Who pays inheritance tax?
Each heir pays tax on their own share, with their personal allowance. See inheritance tax in Germany.
