Give Now or Leave It: Where France and Germany Put the Threshold

The allowance is only half the number — the clock is the other half

Quoting an allowance without its renewal period is like quoting a salary without saying whether it is monthly or annual. France's 100,000 euros and Germany's 400,000 euros are both per parent and per child, which already means a couple with two children can move four times the headline figure. But the compounding effect comes from the reset: fifteen years in France, ten in Germany. Over a working parent's realistic planning horizon — call it from age fifty-five to age eighty-five — France offers three windows and Germany four.

Multiply it out and the difference is not marginal. Three French windows of 100,000 euros give 300,000 euros per parent-child line; four German windows of 400,000 euros give 1,600,000 euros. That is more than five times as much wealth moving without tax, on rules that both countries describe in the same vocabulary of allowances and progressive scales. It also explains why lifetime giving is a mainstream, almost administrative act in Germany and a carefully timed manoeuvre in France.

How each scale bites once the allowance is gone

France applies the same scale to gifts and to inheritances: 5 % up to 8,072 euros, 10 %, 15 %, then 20 % from 15,933 euros all the way to 552,324 euros. The consequence is that the French marginal rate on an ordinary family transfer is 20 % almost from the first euro above the allowance, and it stays there for over half a million euros.

Germany's § 19 ErbStG is gentler where most families live and harsher at the top. In Steuerklasse I — spouse, children, grandchildren, parents on a death — the rate is 7 % up to 75,000 euros of taxable acquisition, 11 % to 300,000 euros, 15 % to 600,000 euros, 19 % to 6,000,000 euros, and then 23 %, 27 % and 30 %. But note how the German bands work: the rate is applied to the whole taxable acquisition, not band by band, which is why § 19 Abs. 3 contains a hardship adjustment to stop a single euro over a threshold from costing more than the euro is worth. It is also why Steuerklasse III, where an unrelated beneficiary starts at 30 % on a Freibetrag of only 20,000 euros, is so punishing.

France's two extra doors: the money gift and the temporary housing exemption

Alongside the 100,000-euro allowance, France runs a separate exemption for gifts of money — 31,865 euros, cumulative with the ordinary allowance and renewing on the same fifteen-year cycle, provided the donor is under 80 and the recipient is an adult child, grandchild, great-grandchild, or a niece or nephew where the donor has no descendants. Because the two stack, a French parent under 80 can move 131,865 euros to an adult child in one operation without duty. The under-80 condition is the trap: it is an absolute cut-off, not a taper.

The second door is new, larger and closing. The 2025 finance act created a temporary exemption for gifts of money used to buy new housing or to carry out energy-renovation work on the recipient's main home, capped at 100,000 euros from any one donor and 300,000 euros in total for any one recipient. The donors it recognises are parents, grandparents, great-grandparents, and aunts and uncles without descendants. The money must be used by the last day of the sixth month after it is paid over, and the gift itself must fall between 15 February 2025 and 31 December 2026. If you are reading this in the second half of 2026, the second date is the operative one.

Germany's family-home exemption has no ceiling, and one hard condition

§ 13 Abs. 1 Nr. 4a ErbStG exempts a gift between spouses of the family home outright, with no value cap at all, provided the property is in Germany, the EU or the EEA and contains a dwelling actually used as the couple's own home. The equivalent for an inheritance, Nr. 4b, adds a condition that changes everything: the surviving spouse must go on using the dwelling as their own home for ten years, or the exemption is withdrawn retrospectively. For children inheriting under Nr. 4c the same ten-year rule applies and the exemption is additionally capped at 200 square metres of living area.

The practical reading is that Germany rewards continuity of occupation rather than the passage of time, and France rewards the passage of time rather than what is done with the asset. A German family that expects the surviving spouse to move into a smaller flat within a decade should price that exemption at zero. A French family that expects to sell should stop worrying about what the child does with the money and start counting fifteen-year cycles backwards from a realistic date.

The mistakes that cost the most

The commonest and most expensive is starting late. Both clocks run from the date of each gift, so a parent who begins at seventy-eight has one window; a parent who begins at fifty-five has three or four. No structure recovers a decade that was not used. The second is forgetting that both allowances are per donor: splitting a gift between two parents doubles it, and a gift made from a joint account without documenting who gave what invites the tax office to attribute it entirely to one of them.

The third is treating an informal transfer as invisible. In both countries a gift is a taxable event whether or not anyone declares it, and the declaration is what starts the clock — an undeclared gift does not begin its fifteen or ten years running, it simply sits there waiting to be discovered when the estate is settled. And a last, useful French detail: if the donor pays the gift duty on the donee's behalf, that payment is not itself treated as an additional taxable gift, which quietly increases what actually reaches the child.

Frequently asked questions

Does the fifteen-year clock in France run from the gift or from the death?

From each gift, and it is measured backwards from whatever comes next. A gift made in 2010 no longer counts against an allowance being used in 2026; a gift made in 2015 still does, and will until 2030. The same reckoning applies at death: the estate looks back fifteen years and adds in any gift inside that window before applying the allowance. This is why the practical advice everywhere is the same — the value of starting early is not sentiment, it is arithmetic.

Can I use the German allowance if the money and I are in France?

Not by choosing. Which country taxes a gift depends on the residence of the donor and of the recipient and on where the asset is, not on where you would prefer the rule to come from. Germany taxes on unlimited liability where either party is resident there, and § 16 Abs. 2 ErbStG reduces the Freibetrag proportionally where only limited liability applies. France and Germany have a bilateral treaty on gifts and inheritances, so a family straddling both should read the treaty rather than pick the friendlier statute.

Is a gift of property treated differently from a gift of money?

The allowances and the scales are the same, but the surrounding costs are not. A gift of real estate needs a notarial deed in both countries, with its own fees and registration formalities, and it raises the question of who bears the future capital-gains position on the asset. A gift of money settles instantly and, in France, has the extra 31,865-euro exemption available on top. That is one reason so much French lifetime giving takes the form of cash rather than bricks.

What happens in France if the donor dies within fifteen years of the gift?

The gift is added back for the purpose of computing the allowance and the progressive scale on the inheritance — a mechanism the French call the rappel fiscal. Duty already paid on the gift is credited, so the same euros are not taxed twice, but the allowance is not restored. The important asymmetry is that the gift is added back at its value at the date of the gift, not at the date of death, so an asset that has appreciated since is effectively brought back at the lower figure.

Does the German ten-year rule also cover gifts to a grandchild?

Yes — § 14 ErbStG aggregates every acquisition from the same person within ten years, whoever the recipient is, and each recipient has their own Freibetrag: 200,000 euros for a grandchild. That is exactly why generation-skipping gifts are a standard German technique: a grandparent with three grandchildren has 600,000 euros of allowance to use every ten years in addition to what goes to the children, and each of those transfers runs its own ten-year counter.