Last updated: November 12, 2026
A house in Calgary, a condo in Munich, a German bank account, a Canadian RRSP. If your assets are in two countries, your estate will be dealt with by two legal systems and two tax systems that do not talk to each other. Without planning, heirs face a German certificate of inheritance procedure, a Canadian probate, German inheritance tax and Canadian capital gains tax, sometimes on the same asset. This article shows where the systems clash and what you can arrange during your lifetime.
TL;DR
- The Canada Germany tax treaty does not cover inheritance tax. A double tax burden on the same estate is possible.
- Canada taxes deemed capital gains of the deceased. Germany taxes the heirs, for German real estate even if everyone lives in Canada.
- German real estate is in many cases governed by German inheritance law, including compulsory shares for children.
- Separate wills are common, but they must be coordinated, or one can revoke the other.
- A will recorded by a German notary can spare your heirs the German certificate of inheritance procedure for real estate.
Does the Canada Germany tax treaty cover inheritance tax?
No. The tax agreement between Canada and Germany deals with taxes on income and capital. It decides, for example, where rental income from a German apartment is taxed. German inheritance and gift tax is not among the taxes it covers. Canada has no inheritance tax, so there is nothing to coordinate on its side.
For income during your lifetime the agreement remains important. For your estate, the two countries apply their own rules side by side.
Two tax systems at death
Canada: When a Canadian resident dies, their capital property is treated as sold at market value immediately before death. The gain is taxed in the final income tax return and paid by the estate. Property passing to a surviving spouse or common-law partner resident in Canada can roll over without immediate tax.
Germany: German inheritance tax is paid by each heir. If the deceased or the heir lived in Germany, the whole inheritance is taxable. If nobody lived in Germany, only German domestic assets are taxed, mainly German real estate. The allowances depend on the relationship, see German inheritance tax allowances.
A Canadian resident who owns an apartment in Germany can therefore trigger Canadian tax on the deemed gain and German inheritance tax for the heirs on the same apartment. Whether the Canadian tax can be credited against German inheritance tax must be checked in each individual case. Richard Rummel, German lawyer in Calgary, reviews your situation. Call him at +1 587 349 3535 or book a consultation.
Which inheritance law applies?
From the German point of view, the EU Succession Regulation applies, even if the deceased lived in Canada. In principle it points to the law of the last habitual residence, for an Albertan the law of Alberta. Canadian conflict rules, however, refer real estate to the law of the place where it is located. The Regulation accepts this reference back. In many cases German law therefore governs German real estate, while Canadian law governs the rest.
This has practical consequences: under German law, children and spouses who are left out have a compulsory share (Pflichtteil) of half their statutory share. A German citizen can also choose German law for the whole estate in a will. Our article on applicable law in cross-border inheritances explains the rules in more detail.
One will or two?
Many clients have a Canadian will for Canadian assets and a German will for German assets. That can work well if both are drafted together. The most common mistake is a standard revocation clause in the newer will that cancels the older one. See our article Two wills: which one is valid?
For the form, German authorities are generous: a will is formally valid if it complies with the law of the place where it was made, the nationality or the residence of the testator, or for real estate the law of the location. Details in formal validity of last wills.
Probate in two countries
A Canadian grant of probate is usually not enough for German banks and the German land registry. Heirs typically need a German certificate of inheritance (Erbschein). For real estate, a will recorded by a German notary together with the record of its opening generally replaces the certificate. How heirs in Canada apply is described in the certificate of inheritance procedure from abroad.
Germany and Canada compared
| Topic | Germany | Canada |
|---|---|---|
| Tax at death | Inheritance tax paid by each heir, allowances by relationship | No inheritance tax. Capital gains taxed in the final return of the deceased |
| Spouse | Allowance €500,000 plus pension allowance | Tax-deferred rollover of property to the spouse possible |
| Forced shares | Children and spouse have a compulsory share (Pflichtteil) if German law applies | No compulsory shares. Dependants can claim support under provincial law |
| Proof of heirship | Certificate of inheritance (Erbschein) or notarized will with opening record | Grant of probate from the provincial court |
| Treaty | Canada Germany tax agreement covers income and capital taxes, not inheritance tax | Same agreement |
Planning steps
- List your assets by country and how they are held, for example joint ownership, beneficiary designation or sole ownership.
- Check which law governs each asset and whether German compulsory shares could affect your plans.
- Coordinate your wills, especially revocation clauses, executors and the order of heirs.
- Use German gift tax allowances, which are available again every ten years, if transferring German assets during your lifetime makes sense.
- Consider a will recorded by a German notary for German real estate.
- Have the Canadian tax consequences checked by a Canadian accountant or estate lawyer.
Example from practice: Mr. and Mrs. B. from Calgary, both Canadian, own a house in Alberta and an inherited apartment in Freiburg. Their Alberta wills left everything to the surviving spouse. We drafted a coordinated German will for the apartment, checked compulsory share claims of a son from a first marriage and explained the German tax position of the children. (Fictitious example based on typical cases from our practice.)
Assets in Canada and Germany? Book a consultation with our German lawyers in Calgary or call us at +1 587 349 3535.
Frequently asked questions
Is inheritance tax part of the Canada Germany tax treaty?
No. The agreement between Canada and Germany deals with taxes on income and capital. German inheritance and gift tax is not among the taxes it covers. Canada has no inheritance tax, so there is no counterpart to coordinate.
Can the same estate be taxed in Canada and Germany?
Yes, that is possible. Canada taxes the deemed capital gains of a Canadian resident at death as income. Germany taxes the heirs on what they receive, for example on German real estate. The German credit rule only covers foreign taxes comparable to inheritance tax, so a double burden cannot be ruled out.
Which inheritance law applies to my German property if I live in Alberta?
From the German point of view, the law of your last habitual residence applies in principle, but Canadian conflict rules refer real estate back to the law of the place where it is located. In many cases German law therefore governs German real estate. A German citizen can also choose German law in the will.
Do I need two wills?
Not necessarily, but separate wills for Canadian and German assets are common. They must be coordinated. A standard revocation clause in the second will can accidentally cancel the first.
Is a Canadian grant of probate enough for my German property?
Usually not. The German land registry generally requires a German certificate of inheritance, or a will recorded by a notary together with the record of its opening.
Who advises on cross-border succession between Germany and Canada?
You need knowledge of both systems. Our German lawyers in Calgary advise on German inheritance law and inheritance tax and work with Canadian estate lawyers and accountants on the Canadian side.
Sources
- Department of Finance Canada: tax treaties
- Canada Revenue Agency: capital gains when someone died
- Section 2 Inheritance Tax Act (ErbStG)
- Section 21 ErbStG, credit for foreign inheritance tax
- Regulation (EU) No 650/2012, EU Succession Regulation
This article is for general information only and does not replace individual legal or tax advice. Rocky Mountain German Law Ltd., Suite 201, 8989 Macleod Trail S.W., Calgary, AB.
