Divorce in Germany…assets before and after marriage

[Emkay]

Please can anyone give me a rough idea on asset splits in the event of divorce on Germany,

Prior to marriage, one owns a property in the UK. The other owns no property, DE or elsewhere

Since marriage, property is jointly purchased in DE, 50/50% Grundbuch.

No pre-nup / Gütertrennung

How would pre marriage/post marriage assets be generally split?

Many thanks in advance for any advice.

[PandaMunich]

No pre-nup / Gütertrennung

Since you did not go to a Notar to do an Ehevertrag so as to choose a marital state that is different from the default one and you lived in Germany immediately after getting married, you are in the German default marital state of "Zugewinngemeinschaft" (community of accrued gains).

For people who started their married lives elsewhere, this may be different, please see here: https://minsk-diplo-de.translate.goog/b ... r_pto=wapp
For an overview of the default marital states in other EU countries, please read chapter 3 in here: https://www.zweiter-gleichstellungsberi ... e5945e.pdf

Since marriage, property is jointly purchased in DE, 50/50% Grundbuch.

The German house remains 50/50, i.e. each of you gets half of it, and each of you gets assigned half the debt that is still on the house

Prior to marriage, one owns a property in the UK. The other owns no property, DE or elsewhere

You get to keep the UK property.
But as the "Zugewinnausgleich" (equalisation of accrued gains),you have to give him half of by what it increased in value during the marriage.
However, there is a mechanism in place to account for inflation, i.e. for the fact that house prices rose just because of inflation, please see chapter 6 in here: https://www-finanztip-de.translate.goog ... r_pto=wapp
and for a more exact calculation, please see here: https://www-lattermann--anwaltsbuero-de ... r_pto=wapp
You can use the month-by-month indices from this consumer price index table: https://www.famrb.de/media/Durchlaufend ... (2020).pdf

Example:
You got married in November 2014, when your UK house had a value of 200,000€ and the consumer price index was 94.1
Your husband received the divorce application which the court sent out, in May 2024, when your UK house was worth 280,000€ and the consumer price index was 119.3
You can only apply for a divorce at the court after your at least 1 year of separation is over, so you actually have to share increases in value that happened after you separated at the start of the separation year.

--> the value of your house adjusted for inflation in November 2014 is 119.3/94.1 * 200,000€ = 253,560€
--> you have to pay him half of the inflation-adjusted gain on the UK house, i.e. 50% * (280,000€ - 253,560€) = 13,220€

Or you can simply use this online calculator, but it only has yearly consumer price indices: https://www.lawyerdb.de/Zugewinnausgleich.aspx

2024-10-06 03_29_43-Zugewinn und Zugewinnausgleich berechnen mit Indexierung.jpg (224.58 KiB) Viewed 292 times

Additionally, you have to give him half of the amount by which your other assets increased during your marriage (again adjusted for inflation), e.g. your bank accounts because of the rent you received from letting your UK house and that you haven't spent yet and because of your interest earned during the marriage.
And he has to give you half of the amount by which your assets increased during your marriage (again adjusted for inflation).

Example:
You got married in November 2014, when your other assets were worth 50,000€, your husband's were worth 100,000€ and the consumer price index was 94.1
Your husband received the divorce application in May 2024 when you had 70,000€ in total and he had 150,000€ and the consumer price index was 119.3

70,000€ wife's ending assets
- 63,390€ wife's inflation-adjusted initial assets (= 119.3/94.1 * 50,000€)
_____________________________________________________________________
6,610€ wife's inflation adjusted gain

150,000€ husband's ending assets
- 126,780€ husband's inflation-adjusted initial assets (= 119.3/94.1 * 100,000€)
_____________________________________________________________________
23,220€ husband's inflation adjusted gain

--> he has to give you:
50% * (23,220€ - 6,610€) = 8,305€

--> if we look at the total Zugewinnausgleich (equalisation of accrued gains) across all assets:

• 13,220€ wife has to give to husband because of price increase of her UK house
  - 8,305€ husband has to give to wife because of increase of other assets
  _____________________________________________________________________
  4,915€ wife has to give to husband

sources (written by a lawyer):

• Divorce in the default marital state "Zugewinngemeinschaft" (community of accrued gains): https://www-kanzlei--hasselbach-de.tran ... r_pto=wapp
• Real estate in the default marital state "Zugewinngemeinschaft": https://www-kanzlei--hasselbach-de.tran ... r_pto=wapp
• Jointly owned house in the in the default marital state "Zugewinngemeinschaft": https://www-kanzlei--hasselbach-de.tran ... r_pto=wapp

[alma.freya]

What would happen if the wife started the marriage with 200k assets, ended the marriage with 150k assets, and has a depot with capital gains of 20k.

200 - 150 = -50 total loss during marriage

Would the 20k capital gains still be equalised?

Are individual asset (depot, property, classic car etc.) gains equalised regardless of a spouse total gain/loss during the marriage?

[PandaMunich]

What would happen if the wife started the marriage with 200k assets, ended the marriage with 150k assets, and has a depot with capital gains of 20k.

200 - 150 = -50 total loss during marriage

Would the 20k capital gains still be equalised?

No.

Are individual asset (depot, property, classic car etc.) gains equalised regardless of a spouse total gain/loss during the marriage?

No, only the total gain/loss during the marriage counts.

[alma.freya]

What would happen if the wife started the marriage with 200k assets, ended the marriage with 150k assets, and has a depot with capital gains of 20k.

200 - 150 = -50 total loss during marriage

Would the 20k capital gains still be equalised?

No.

Are individual asset (depot, property, classic car etc.) gains equalised regardless of a spouse total gain/loss during the marriage?

No, they only the total gain/loss during the marriage counts.

Ok and inheritance is considered a protected asset?

Initial: 25k + 75k inheritance received during marriage = 100k
Ending: 80k (including 18k capital gains from investment of inheritance during marriage)

Option 1: 80 - 100 = -20k.
Option 2: 80 - 25 = 55k

I assume option 1 would be used and no equalisation would be due because inheritance is considered an initial asset?

[Emkay]

@PandaMunich. Thank you so much for your super helpful reply. It’s very much appreciated.

[PandaMunich]

Ok and inheritance is considered a protected asset?

Initial: 25k + 75k inheritance received during marriage = 100k
Ending: 80k (including 18k capital gains from investment of inheritance during marriage)

Option 1: 80 - 100 = -20k.
Option 2: 80 - 25 = 55k

I assume option 1 would be used and no equalisation would be due because inheritance is considered an initial asset?

Yes, it's option 1, the inheritance gets added to the initial assets, this is laid down on § 1374 (2) BGB: https://www.gesetze-im-internet.de/engl ... html#p5634

• (2) Assets that a spouse acquires after the beginning of the property regime as a result of death or with regard to a future right of succession, by donation or as advancements, are added to the initial assets after deduction of the liabilities, to the extent that in the circumstances they are not to be seen as income.

Please also read: https://www-asp--rechtsanwaelte-de.tran ... ngen%20etc.

However, you forgot to do the inflation-adjustment of the initial assets.
In your case, even without inflation adjustment, it's clear that there was a loss, i.e. that no equalisation is due.
But that may not always be the case.

The online Zugewinnausgleich calculator: https://www.lawyerdb.de/Zugewinnausgleich.aspx
has a section in which you can input received gifts/inheritances and it then does the inflation adjustment, it's the section "Erhaltene Zuwendungen nach §1374 Abs. 2 BGB":

2024-10-06 23_27_34-2024-10-06 03_29_43-Zugewinn und Zugewinnausgleich berechnen mit Indexierung (1) .jpg (239.56 KiB) Viewed 199 times

[DuBa]

I have a similar question: how is income of non-married partners treated under German law?
Neither partner has physical assets, they are living together for several years and are not formally married and no formal life partnership has been established apart from sharing an apartment. Would one partner be entitled to share of the other's income or savings earned during their cohabitation?

[PandaMunich]

I have a similar question: how is income of non-married partners treated under German law?
Neither partner has physical assets, they are living together for several years and are not formally married and no formal life partnership has been established apart from sharing an apartment. Would one partner be entitled to share of the other's income or savings earned during their cohabitation?

No.

[DuBa]

Thank you Panda!

I assume that German law does not recognize an "extramarital union" (this is a literal translation to English of a legal term from another European language), in other countries partners have the same rights and obligations as if they were married.

[PandaMunich]

I assume that German law does not recognize an "extramarital union" (this is a literal translation to English of a legal term from another European language),

It only recognises it, if it saves the state money.
For example, if someone gets welfare and they live together with someone else, they are seen as a "Bedarfsgemeinschaft": https://www-hopkins-law.translate.goog/ ... r_pto=wapp
--> If the other person earns too much, less or even no welfare gets paid.

[DuBa]

Thanks again Panda! Term "eheähnliche Gemeinschaft" explains a lot