What happens to the Altersvorsorgedepot when the saver dies?

Tilman Freyenhagen

Published on 14 June 2026 · Updated on 7 August 2026 · Managing Director & Partner, Alsterspree Verlag GmbH

The Altersvorsorgedepot when the saver dies: the key rules at a glance

What happens to the assets painstakingly saved in the new Altersvorsorgedepot (AVD) when the saver dies? This question weighs heavily on families in particular. In principle, the capital saved in the Altersvorsorgedepot is inheritable and becomes part of the estate^[1]. Our knowledge portal, Vorsorgedepot-Lotse, shows, however, that how large the deductions are depends decisively on how closely related the survivors are. While spouses benefit from a far-reaching privilege, other statutory heirs have to accept financial reductions through a clawback of the subsidy^[1].

The spousal privilege: a tax-free, subsidy-preserving transfer

Spouses enjoy an advantageous special position when it comes to inheritance. If a saver dies, the entire accumulated retirement assets can be transferred without deductions to the surviving spouse's Altersvorsorgedepot^[1]. The state allowances and the tax benefits from the special-expense deductions remain fully intact in this scenario^[1]. This is an important statutory easement designed to secure the surviving partner financially, without eroding the subsidised capital through tax clawbacks.

For other heirs — such as children or relatives — this special rule does not apply, however. The capital is indeed inherited by them, but the state reclaims the allowances and tax benefits granted^[1]. Only the net capital, after adjustment, is paid out, and this can additionally be subject to inheritance tax. To simulate the concrete subsidy effects for your personal family situation, our subsidy calculator is available to you. You can find further detail on tax questions in our knowledge section. Timely personal advice is also recommended for reliable protection.

The accumulation phase: inheriting the subsidised capital before retirement

Should death occur during the accumulation phase, the accumulated contract balance generally passes to your heirs. Under civil law, the account balance is protected as ring-fenced assets and becomes 100 percent part of the estate. As part of our information offering on the knowledge section, we show you that this balance represents an important financial safety net for your family, provided you know the legal framework. The assets in the Altersvorsorgedepot are made up of your own monthly contributions, the returns generated, and the state allowances and tax savings.

A decisive special rule applies for spouses when it comes to inheritance: on death, the accumulated retirement assets can be transferred without deductions to a pension contract held in the name of the surviving spouse^[1]. This transfer is entirely neutral for the subsidy, so all state allowances and tax benefits stay within the family. For all other heirs, such as your children, by contrast, the inheritance counts as a use that damages the subsidy. In that case, the capital you paid in, including any increase in value, does remain part of the inheritance, but the state subsidy has to be repaid to the tax authorities^[2].

For families, this distinction matters enormously, so that no financial losses are suffered in a worst case. With our source-based subsidy calculator, you can calculate various scenarios and the expected final capital. Because detailed estate planning and tax aspects are highly individual, we also recommend personal advice. Our independent advice service helps you easily get in touch with licensed experts, to protect your family in the best possible way. (Note: the calculations and explanations are for illustration and do not constitute investment advice within the meaning of § 1 Abs. 1a Nr. 1a KWG.)

The spousal privilege: a subsidy-preserving transfer without deductions

When a saver dies, the statutory framework for the subsidised Altersvorsorgedepot sets out strict rules. If the insured person dies during the accumulation phase, inheriting the capital by ordinary heirs generally counts, legally, as a damaging use. That means the state allowances received and the tax benefits have to be repaid to the state, and the remaining capital is subject to income tax. For families and married couples, however, the legislator has created an important exception: the so-called spousal privilege.

The conditions for a subsidy-preserving transfer

Under certain conditions, the accumulated retirement capital can be transferred without any deduction to the surviving partner's contract. Under the guidelines of the Bundesministerium für Finanzen (the Federal Ministry of Finance, BMF), the state subsidy remains fully intact in this case, and there is no immediate taxation of the capital^[1]. The requirement for this is that the accumulated assets are transferred directly to a pension contract held in the name of the surviving spouse or registered civil partner^[1]. This protects the family's long-term financial security. You can find further detail on the legal background and how this will work from the 2027 launch in our knowledge section.

This special statutory position ensures that, in a worst case, the retirement assets a married couple has painstakingly built up remain earmarked for the partner's retirement provision. Because the transfer process is bound to formal deadlines, timely protection and review of the contracts is advisable. Our independent advice service is happy to help you find the right contractual arrangements for your family situation, so your assets remain optimally protected in the future too.

Other heirs: why state allowances and tax benefits have to be repaid

The new Altersvorsorgedepot, which paves the way for more modern private retirement provision from 2027, raises important inheritance questions for many families. If a saver dies, statutory succession or the will determines what happens to the estate. If you leave your balance to people other than your spouse (for example, your children, grandchildren or more distant relatives), strict tax rules apply. Unlike a spouse, children cannot transfer the subsidised retirement balance into their own Altersvorsorgedepot without tax disadvantages. Passing it on to these heirs legally counts as a damaging use, because the accumulated capital no longer serves the saver's original purpose of subsidised retirement provision^[3].

This damaging use has immediate financial consequences for the community of heirs. In this case, the state reclaims all the allowances granted over the years, as well as all tax benefits and tax refunds received. The account provider deducts these amounts directly from the account balance and pays them to the state allowance office. The heirs are therefore paid out only the remaining net capital — that is, your own contributions plus the returns achieved, minus the clawed-back subsidy. This net pay-out becomes part of the regular estate and is subject to the general rules on inheritance tax, as well as any taxation of accrued gains.

It is therefore of central importance for families to engage with the legal options early on and plan their financial protection in the event of inheritance precisely. In our guides on the knowledge section, you will find well-founded, source-based analysis of the legal rules. Because every family situation raises individual questions, a personal conversation can provide clarity. Through the independent advice service, you can easily get in touch with an expert who advises you comprehensively on the best strategies for your Altersvorsorgedepot.

Inheritance tax and estate law: how the account's assets are treated for tax purposes

If a saver dies, the capital accumulated in the Altersvorsorgedepot becomes part of the estate. Contrary to popular assumption, private assets do not simply lapse on death, but pass to the statutory or testamentary heirs. For tax purposes, this inherited account balance is subject to the regular provisions of the Erbschaftsteuer- und Schenkungsteuergesetz (the Inheritance and Gift Tax Act, ErbStG)^[4]. This statutory rule matters greatly to families, because the inheritance is taxed differently depending on the degree of kinship, and the state subsidy is tied to specific conditions.

For forward-looking estate planning within the family, it is essential to factor in these allowances early on^[4]. While the spouse is especially protected through the transfer option, children and other heirs have to reckon with the state subsidy being deducted, because the tax benefits are tied to the individual. As a neutral guide, the knowledge section helps you get a clear, factual grasp of these complex rules for the new Altersvorsorgedepot from 2027. If you are seeking tailored protection for your family, a qualified consultation is a good route. Through our independent advice service, you can easily get in touch with licensed experts to have your individual retirement and inheritance situation planned professionally. Please note: our descriptions are for information only and do not constitute tax or legal advice.

The payout phase: what happens to the account once you retire?

Once you reach retirement age, the payout form you choose is decisive for whether your Altersvorsorgedepot can be inherited. If you opt for a structured drawdown plan running until age 85, the remaining account balance stays fully your personal property if you die. If the saver dies during this ongoing payout phase, the remaining capital is transferred to the statutory heirs. If you instead choose a classic, lifelong life annuity to protect against longevity risk, your individual right to the capital generally ends on death, since the remaining assets stay in the insurer's collective pool and therefore cannot be passed on to the family^[1].

Especially for families, the new Altersvorsorgedepot offers valuable financial protection in a worst case through the so-called spousal privilege. If a partner dies during the payout phase, the remaining subsidised capital can be transferred without tax deductions and without any loss of the state allowances accumulated so far to an existing or newly set-up Altersvorsorgedepot belonging to the surviving spouse^[1]. For all other statutory heirs, such as your own children, inheriting the state-subsidised capital is unfortunately treated for tax purposes as a damaging use. This triggers a clawback of the allowances, while the remaining net savings pass into the estate as normal.

Because the tax rules and the optimal choice of payout phase depend heavily on your individual family situation, forward-looking planning is essential. Use the subsidy calculator on our portal to transparently simulate the long-term effects of different withdrawal strategies. For well-founded background knowledge, the knowledge section is available to you at any time. Should you want a personal structure tailored to your family's needs, through our independent advice service we are happy to connect you with licensed experts who guide you neutrally, on a source-based footing.

Preparing for the worst case: getting beneficiary designations and account succession right

Nobody likes to think about their own death, but for families, clarifying account succession in good time is an essential step towards financial security. Without clear provisions, the assets you have painstakingly saved can, in a worst case, lead to protracted disputes over the estate or be eroded by tax disadvantages. If you set precise course while you are still alive, you ensure that your Altersvorsorgedepot from 2027 reaches where it is needed without bureaucratic hurdles. Through the knowledge section, you can inform yourself about the legal framework of the new reform at any time.

A provider-held instruction versus a will

To arrange account succession in a legally secure way, you essentially have two routes open to you, which ideally should be coordinated with each other. First, you can lodge a written beneficiary designation directly with the account provider. This instruction means the balance passes directly to the named people on death, without a lengthy wait for a certificate of inheritance. Second, the account can be governed through a will or an inheritance contract. Seamless coordination matters here: if the testamentary instruction and the beneficiary designation lodged with the broker contradict each other, this can lead to legal disputes among the heirs. Spouses also benefit from special rules, since under certain conditions the subsidised capital can be transferred without tax deductions to their own Altersvorsorgedepot^[1].

Because the legal detail surrounding the new Altersvorsorgedepot is complex, families should not leave succession planning to chance. Beyond the pure transfer of capital, inheritance tax and tax-free allowances play a decisive role. Through Vorsorgedepot-Lotse, you can easily get in touch to receive individual advice from a qualified expert on the tax consequences for your family. This kind of support protects your survivors from financial losses and creates lasting clarity.

Why families need advice: why individual protection is decisive

For young families, financially protecting the survivors in the event of death is the top priority. If an account holder dies during the accumulation phase, the existential question arises of how the accumulated assets and the state subsidy are treated legally. Strict statutory rules apply here under inheritance law and tax law, and these require precise coordination. While the pure capital is generally inheritable, the heirs' degree of kinship decides whether the state subsidy received stays intact or has to be repaid to the state^[1].

This distinction makes clear that unprepared inheritance can bring noticeable financial losses for your survivors. Spouses benefit from the special statutory rule allowing them to transfer the subsidised assets directly into their own Altersvorsorgedepot without tax disadvantages or losing allowances^[1]. For children or other statutory heirs, by contrast, this privilege does not apply, which leads to an automatic clawback of the state allowances.

To avoid such pitfalls and protect the assets you have saved for your family in the best possible way, you should analyse the various scenarios early on. With the subsidy calculator, you can work out the expected level of the state subsidy, and through the knowledge section access more in-depth expert information on the enacted reform (not investment advice within the meaning of § 1 Abs. 1a Nr. 1a KWG). Because the interplay between inheritance law and private retirement provision is highly individual, however, the route via the Vorsorgedepot-Lotse portal and our independent advice service is recommended for legally secure contract arrangements. A qualified expert helps you integrate the account seamlessly into your family's protection strategy.