Gift tax: Exemption for contribution of a family home to a marital civil law partnership

Any generous gift is subject to gift tax as a gift inter vivos if it enriches the recipient at the expense of the donor (Section 7 (1) No. 1 with Section 1 (1) No. 2 ErbStG, Inheritance Tax Act). However, a gift between spouses whereby one spouse grants the other (co-)ownership of a developed property located in Germany, insofar as it is used as a residence for their own living purposes (family home), remains tax-exempt pursuant to Section 13 (1) No. 4a ErbStG. In its decision of June 4, 2025 (case no. II R 18/23), the German Federal Fiscal Court clarified that this tax exemption also applies in the case of a gratuitous contribution to the assets of a civil law partnership (GbR) previously founded by spouses.

In 2020, the spouses established a civil law partnership with equal shares through a notarized agreement and agreed to transfer the developed property used by both for residential purposes and solely owned by the wife to the partnership's assets. They considered this to be a gratuitous marital gift from the wife to her husband. The GbR was entered in the land register as the owner of the property, naming both spouses. While filing the gift tax return, the husband applied for tax exemption for a family home for his acquisition, which the tax office denied in view of the transfer of ownership of the property to the GbR. The FG and BFH disagreed. 

Although under civil law the GbR acquires ownership of the developed property as an independent legal entity, according to the independent assessment under gift tax law, it is not the GbR as a joint owner but the partners as joint owners who are to be regarded as having gained financially. The Federal Fiscal Court refers to its previous case law that the partial legal capacity of an (external) GbR does not preclude its classification under gift tax law. According to this, in the case of a donation to a joint ownership community, it is not the community but its partners who are to be regarded as enriched and thus liable for tax in accordance with Section 20 ErbStG. Despite the partial legal capacity and land register capacity of the GbR, the ownership of the gifted property acquired by it is attributed to the individual partners. Consequently, the question of who acquires ownership of the family home through the inter vivos gift must be based on the enriched spouse. The property attributed to the partner as a participant in the joint property via the GbR is sufficient for the granting of tax exemption under Section 13 (1) No. 4a ErbStG.

Notice:

The ruling shows once again that civil law and tax assessments are not always completely identical. Different approaches may also arise depending on the type of tax. A detailed analysis of the individual circumstances and the respective tax consequences is essential.