How is the property determined

Calculate gain compensation

This is how you calculate your gain in a divorce

Dr. Britta Beate Schön
Legal Expert As of April 22, 2019

Dr. Britta Beate Schön

Britta Beate Schön is responsible for all legal issues at Finanztip. The doctor of law and attorney was head of the legal department at financial service providers such as Telis Finanz AG and Interhyp. Before that, she taught and researched in Japan as a DAAD junior professor for German and European law. She completed her studies in Münster, Geneva, Regensburg and Leipzig. You can reach the author at [email protected]

  • Without a marriage contract, married people automatically live in a community of profit.
  • Anyone who is getting a divorce and has previously lived in a community of profit can demand half of the assets generated during the marriage.
  • Not everything is balanced, only the increase in wealth after marriage. In the case of an inheritance or gift, only the increase in value is offset, but not the inheritance itself.
  • It is up to the spouses whether they want to carry out a formal profit equalization procedure in the context of the divorce.

Anyone getting a divorce and living in a community of profit during the marriage can apply for a so-called profit compensation. This applies to all marriages in which the couple did not sign a marriage contract before the notary. Because spouses live automatically in a community of gainsif they do not contractually agree something else (§ 1363 Abs. 1 BGB). This also applies to registered civil partnerships.

The gain that the spouses make in marriage is in divorce on application balance. In contrast to the pension adjustment, nothing happens as long as you do not submit an application to the family court.

What is the profit sharing?

During the marriage, both spouses, or at least one of them, usually gained wealth. This can be, for example, bank balances, land, securities, insurance, luxury goods or your own company. The increase in wealth can also be due to debts being paid off during the marriage. The gain is the difference between a partner's final fortune in the event of a divorce and his initial fortune in the case of marriage.

The law assumes that, in principle, both spouses should each share half of the increase in wealth during the marriage. If, for example, a woman and a man both add up to 200,000 euros richer during the marriage, each of them is entitled to half of it, i.e. 100,000 euros.

The compensation claim is a claim to a certain amount of money. It cannot be required that certain assets be transferred. If, for example, the wife acquired less assets than her husband during the marriage, she can only demand that he pay her compensation. She cannot ask that he let her part of the stake or the house. Of course, the couple can agree something else with each other.

For the calculation of the gain adjustment there is a Statement of assets required. All existing assets must be included in the calculation. It is therefore not possible to balance individual assets in isolation.

Our tip: First try to regulate the profit sharing among each other. Otherwise, the legal and court costs can rise quite considerably.

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When is there no profit compensation?

The profit sharing does not necessarily have to be carried out in the event of a divorce. Nobody forces the couple to do so.

No application- It is up to the spouse to whom the gain adjustment is entitled to decide whether and how to assert this claim. If the differences in wealth are very large or you have no overview at all, you should consult a specialist lawyer for family law. This is the only way to calculate a claim.

Same gain- In many cases, there is no need to compensate for profits. Namely, when it is clear from the outset that a man and a woman have gained an equal amount during the marriage. Typical example: when they got married, neither of them had any assets, during the marriage a house was bought together, and there are no other noteworthy assets. Here the gain is the same on both sides, namely half of the co-ownership of the house, so that a gain compensation is not even considered.

Contractual regulation- Spouses can agree in a marriage contract that the profit compensation should be calculated differently than the law provides. For example, you can specify that certain assets should not be taken into account. Or you can decide that the beneficiary will be compensated with a lump sum. You can also regulate in the contract that the beneficiary receives an asset instead of a sum of money. These and other conceivable agreements always require notarial certification. Then there will be no compensation procedure according to the legal regulations.

Separation of property- If you have already agreed the separation of property in front of a notary by means of a marriage contract, no gain compensation can be requested in the case of the divorce. Such an agreement can be made at the time of marriage in a prenuptial agreement, but also during the ongoing divorce proceedings.

How is the gain compensation calculated?

The equalization of profits presupposes that the two total assets of the spouses are compared with one another. For each person, the increase in wealth during the marriage is to be determined. To do this, one calculates the difference between his final and initial fortune. Initial wealth is the wealth he had at the time of marriage. Final assets are the assets that the spouse has at the end of the marriage.

Since September 1, 2009, the key date is not the divorce, but the day of Delivery of the application for divorce to the other spouse (§ 1384 BGB). If the marriage was legally divorced before September 1, 2009, the deadline for the compensation claim is still the termination of the marriage (BGH, judgment of July 16, 2014, Az. XII ZR 108/12)

It only depends on the respective wealth of the spouses at this point in time. It does not matter who paid what during the marriage. Just as uninteresting is who has earned more than the other.

The gain of the two spouses is compared. The person who earned more must pay half of the net profit to the other spouse.

Example: At the time of marriage, the husband had 10,000 euros. At the time of the divorce, he had accumulated a fortune of 25,000 euros from his professional activity. The wife owned 5,000 euros at the beginning of the marriage and 6,000 euros at the time of the divorce.

The husband's gain is thus: 25,000 euros - 10,000 euros = 15,000 euros.
The gain for the wife is: 6,000 euros - 5,000 euros = 1,000 euros.
The surplus of gain is: 15,000 euros - 1,000 euros = 14,000 euros.
The wife can demand half of this surplus from the husband, i.e. 7,000 euros.

With regard to the right to compensation, it is advantageous for each individual spouse if their initial assets are as large as possible, while their final assets are as small as possible. The larger the initial and the smaller the final wealth, the smaller the gain.

What is part of the initial wealth?

The following peculiarities can occur when determining the initial assets:

No precise knowledge of the assets at the time of marriage- If you can no longer prove exactly what assets were available at the time of marriage, your initial assets will be set at 0 euros (§ 1377 Paragraph 3 BGB). Everything has to be proven: Anyone who no longer has any records from back then (savings book, bank documents, etc.) is left empty-handed. Before getting married, you should write down exactly what assets and debts you have.

Marriage debt- If a spouse only had debts at the time of the marriage or if his debts were greater than his assets, these are taken into account. So-called negative initial assets are applied (Section 1374 (3) BGB).

Inheritance and gifts- Inheritances and gifts should be left out of the equation of profits. Therefore, they are added to the initial assets, even if they were only acquired after the wedding (1374 para. 2 BGB). This is intended to ensure that the equalization of profits is really limited to what is jointly generated. The other spouse does not benefit from the inheritance or gift because it is pretended that the inheritance already existed at the wedding.

Example: The wife owns 30,000 euros at the time of marriage. The mother dies during the marriage and inherits 150,000 euros. These 150,000 euros are added to the initial assets, so the initial assets are 180,000 euros.

What is part of the final assets?

The final assets include all assets that were available when the application for divorce was served on the other spouse. Debts are to be deducted. It is irrelevant where the assets come from. The final assets also include:

  • Assets that already existed at the time of marriage,
  • Inheritances and gifts,
  • Property acquired with inherited or gifted money,
  • Lottery win, even if it goes to one spouse long after the separation (BGH, judgment of October 9, 2013, Az. XII ZR 125/12),
  • Compensation for pain and suffering (BGH, judgment of May 27, 1981, Az. IVb ZR 577/80) and
  • Life insurances that are not used for old-age provision but for asset accumulation and are therefore not included in the pension equalization scheme. The surrender value or the fair value is used as the value if they are to be continued. The insurer must issue such a confirmation.

Joint assets of the spouses are also taken into account, but only their own share. So if the parties bought a joint house with a value of 300,000 euros during the marriage, this house will each flow into the final assets of both persons with an amount of 150,000 euros.

Negative final fortune- The final assets, just like the initial assets, can also be negative if a partner is in debt when the application for divorce is served (Section 1375 (1) sentence 2 BGB).

Allocation to final assets- If the partner has wasted assets, the amount that is no longer available will still be added to the final assets (Section 1375 (2) BGB). However, this has to be proven, which is not easy. A generous lifestyle or a life beyond the means is not enough. Participation in games of chance is wasteful if the gambling away of one's fortune is frivolous.

How is an inheritance taken into account during marriage?

An inheritance is added to the initial assets. As long as the inheritance still exists, it also belongs to the final wealth. For example, if the husband had no assets at the beginning of the marriage but inherits a house during the marriage, the house will be added to the initial assets at its then value. If he still owns the house at the end of the marriage, it will also be added to the final assets with the value when the application for divorce was served. You do this in order to record interim increases in value through the gain.

It is irrelevant where the increase in value comes from. It may come from the owner renovating the house. It can also simply come from the fact that land prices have increased. The so-called market value of the asset is always decisive. In other words, the value that could be achieved as proceeds from a sale by taking advantage of all market opportunities.

Example: The husband has a debt of 10,000 euros at the time of marriage. In 1995 he inherits a house that was then valued at 150,000 euros. At the end of the marriage in 2017, however, it is worth 220,000 euros. He took out a loan for renovation costs, which will add up to 40,000 euros when the application for divorce is delivered. The wife owned 20,000 euros at the beginning of the marriage. At the end of the marriage, her fortune amounts to 30,000 euros.

As you can see in the diagram, the wife's claim amounts to 15,000 euros.

How does purchasing power equalization work?

When calculating the profit equalization, the value of the initial assets must be deducted from the final assets. So that these values ​​are really comparable, the initial assets must be converted to the monetary value on the key date of the final assets. The inflation-related loss of purchasing power is deducted from the gain compensation with the help of so-called indexing. The consumption price indices of the Federal Statistical Office are decisive here. As a rule, the annual index is used and no differentiation is made according to months.

This is done with the following formula:
Initial assets x index at the time of the divorce petition / index in the event of marriage =
indexed initial assets.

Consumer price indices from 1991

199165,5200181,5201195,2
199268,8200282,6201297,1
199371,9200383,5201398,5
199473,8200484,9201499,5
199575,1200586,22015100
199676,1200687,62016100,5
199777,6200789,62017102
199878,3200891,92018103,8
199978,8200992,2  
200079,9201093,2  

Source: Federal Statistical Office (as of April 2019)

If you want to calculate your profit online, the purchasing power compensation is usually taken into account automatically. For example, you can request this form from the law firm Dr. Use Annegret Wiese from Munich.

Example: The wife had assets of 20,000 euros when they married in 1992. At the end of the marriage in 2018, she had assets of 220,000 euros, a net gain of 200,000 euros.
Calculation of indexed initial assets:
20,000 euros × 103.8 / 68.8 = 30,174 euros.
The gain now only amounts to 189,826 euros.

Are there limits to the compensation of profits?

There is a limit to the amount of gain compensation. The person who is obliged to compensate only has to pay up to the amount of his actual assets. How much wealth is actually available must be proven as a final wealth. He may have to pay this sum, but he does not have to incur any debts to offset the gain.

If the gain consists primarily in the fact that debts have been repaid, the claim for compensation can even be omitted entirely if there is no assets (§§ 1378, Paragraph 2, Clause 1, 1384 BGB).

Example: If the husband enters into the marriage with 100,000 euros in debt, he has a gain of 120,000 euros with a final net worth of 20,000 euros. If the wife has not made any profit, the compensation claim is 60,000 euros. However, the claim is limited to the existing assets, so that the wife can only demand 20,000 euros as compensation.

Is there an obligation to provide information?

In order to be able to calculate the gain compensation, you have to ask your partner for information about his assets. You need an overview of his initial assets and his assets upon separation (Section 1379 (2) BGB). This is to prevent assets from being put aside between separation and divorce.

But what if the spouse gave away his property before the separation? Or has transferred values ​​to a third party so that you are disadvantaged as a result? If there is a suspicion that a spouse had assets or assets disappeared before the separation, he must also provide information about this (BGH, judgment of August 15, 2012, Az. XII ZR 80/11).

However, you not only have to have a suspicion, but also present specific facts and also be able to substantiate them. Otherwise it will be difficult to find out about the time of separation.

When does the entitlement to gain compensation expire?

The right to gain compensation expires three years after the divorce becomes final (Section 195 BGB). This means that the spouse who thinks he is getting something from the other cannot wait forever with his demands.

Dr. Britta Beate Schön

Dr. Britta Beate Schön

Britta Beate Schön is responsible for all legal issues at Finanztip. The doctor of law and attorney was head of the legal department at financial service providers such as Telis Finanz AG and Interhyp. Before that, she taught and researched in Japan as a DAAD junior professor for German and European law. She completed her studies in Münster, Geneva, Regensburg and Leipzig. You can reach the author at [email protected]

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