With a gift, you can settle your estate and at the same time experience how it can do something good. In this article, you will find out how a gift works, what you need to consider (legally) and which deadlines and regulations apply. 

Imagine if you could see your wish to protect the last wilderness areas on our planet become a reality today. What would it be like to not only know that your legacy will make a difference, but to actively witness it? That's exactly what a lifetime gift to Wilderness International allows you to do.

A gift is a decision made during one's lifetime and in this sense is not a traditional donation to an estate that only occurs after death. In addition to the opportunity to share in one's inheritance during one's lifetime, the ten-year period of the Inheritance and Gift Tax Act is another reason why many people resort to making a gift to settle their own estate. 

The ten-year period is intended to prevent inheritance tax avoidance. Otherwise, it would be possible to simply give away your own estate without paying inheritance tax. 

Gifts made more than 10 years before the deceased's death are not taken into account when calculating inheritance tax. The tax-free amounts can then be fully utilized (again) in the inheritance.

Gifts made within 10 years prior to death are added to the estate on a pro rata basis in accordance with the meltdown model: For each year that has passed since the gift was made, 10% of the value of the gift is deducted from the addition. 

If death occurs after 5 years, for example, 50% of the value of the gift is added to the estate. 

It is only a gift if there is no consideration. Tax relief or tax exemption under gift tax law is only conceivable if there is no consideration. 

It is therefore advisable to draw up a gift agreement that stipulates that the gift is free of charge. This ensures legal certainty and tax clarity. 

Ultimately, everything that belongs to you can be given away: 

• Money: Whether cash in hand, by bank transfer or as a deposit into an account - gifts of money are flexible and uncomplicated.
• Real estate: You can give away a house, an apartment, a plot of land or even just a share of it.
• Securities and custody account assets: These include shares, fund units, bonds or even entire custody accounts.
• Company shares: If you own shares in a GmbH, AG or other company, you can also give these as a gift.
• Moveable property: As the name suggests, you can give away so-called movables. These are, for example, cars, art and jewelry, furniture, collections of letters or coins or even patents and licenses. 

Important: Notarization is required for many properties. 

Gifts to charitable organizations are exempt from gift tax. 

As the donor, you can claim your gift as special expenses for tax purposes. You also "relieve" your heirs by reducing your estate with a gift, which can have a positive effect on inheritance tax.