Marriage in Germany automatically creates a legal contract between the spouses, even if they have not signed an individual Prenuptial agreement. The default regime is a community of accrued gains, under which assets accumulated during the marriage are taken into account in a divorce. Gifts and inheritances are excluded.

This arrangement can become expensive when one spouse owns a successful company or real estate. Even if a property was purchased before the wedding, the increase in its value during the marriage may count toward the accrued gains. Pension entitlements are generally divided as well, and a claim to post-marital support may arise.

For example, if one spouse enters the marriage without assets and the other increases her wealth from €100,000 to €300,000, half of the €200,000 increase—€100,000—would be payable in an Equalization of accrued gains. Lawyers recommend documenting both partners’ assets on the wedding day. If the initial assets cannot be proven, a court may calculate the equalization from zero.

A prenuptial agreement commonly modifies the statutory regime rather than eliminating every form of equalization. It may exclude company shares or separately acquired property, and it can set out post-marital support. Such provisions are particularly relevant for couples planning children, since one partner may reduce working hours for childcare. Agreements can also describe the intended division of paid work and caregiving, which may later help assess whether the couple’s original arrangements were followed.

The agreement cannot unfairly disadvantage one spouse. A court may declare it invalid if, for example, one partner is excluded entirely from pension equalization without receiving another form of financial compensation.

A prenuptial agreement is not required simply to protect one spouse from the other’s debts. Unless the partners take out a loan together or guarantee each other’s obligations, each generally remains responsible for their own finances. Debts can nevertheless affect the calculation of accrued gains.

The contract can be concluded before or during the marriage. An agreement made shortly before divorce is known as a divorce consequences agreement. A notary or a family-law attorney can prepare the document, but changes to the marital property regime and provisions involving real estate or support generally require notarization. Attorneys represent their individual clients, whereas notaries must remain neutral. Couples can therefore jointly instruct a notary, but independent legal advice requires each spouse to have their own attorney.

Notary fees are set by Germany’s Court and Notary Costs Act and depend on the transaction value. This value is based largely on the couple’s adjusted net assets: debts are deducted, although only up to half of the gross assets. In one example involving adjusted net assets of €500,000, the exclusion of accrued-gains equalization, three years of monthly support payments of €1,200 and the exclusion of pension equalization would result in a notary bill of €2,446.

The notary fee is the same whether the notary drafts the agreement or notarizes a document prepared by an attorney. Attorneys calculate fees under the Lawyers’ Compensation Act, although they can generally negotiate their out-of-court remuneration. Fees may be based on the value of the matter, the time involved or a flat rate. In the example above, a calculation by the German Bar Association would produce an attorney fee of €13,109, including business and settlement fees. In practice, a lawyer may charge less for a straightforward agreement.

There is no discount for combining legal and notarial services. A lawyer who drafted an agreement cannot notarize it as a notary, and this also applies within the same firm. In very simple cases, couples may be able to proceed without an attorney. However, each spouse is advised to obtain independent legal advice before signing.

A separate-property regime is another legally defined option, but it requires a notarized agreement rather than a simple declaration at the registry office. Under this regime, assets remain separate during the marriage and no equalization takes place when the marriage ends. It can, however, have tax disadvantages if one spouse dies: the surviving spouse may have only a €500,000 tax allowance, while the accrued-gains regime can provide an additional allowance. Lifetime tax-planning mechanisms based on switching marital property regimes are also unavailable under separate property.

Family-law attorney Eva Becker says separate property is now uncommon and is mainly chosen by older couples who have previously been married, have no children together and do not want to combine their finances.

Sources: Handelsblatt.