Short answer: Under section 93 EStG in the version available today, a payout on death is generally treated as harmful use, which requires repayment of the allowances. Exceptions include survivors’ pensions and transfer to the spouse on death. From 2027 the rules of the pension reform act apply to the Altersvorsorgedepot, and you should check them in the contract and in the law (last updated: November 2026).
With the Altersvorsorgedepot, a question arises on death that rarely comes up with an ordinary savings account: what happens to the state subsidy when the contract holder dies? The answer depends on who receives the balance. This guide explains the differences between spouse, children and other heirs, sets out the legal consequences and names steps to arrange the contract in advance.
The most important points
- A payout on death is, under the version of section 93 EStG available today, generally harmful use and leads to repayment of the allowances.
- Transfer to the spouse on death is one of the statutory exceptions.
- Survivors’ pensions are also named as an exception.
- In the contract you set out who is the beneficiary on death. Have this confirmed in writing.
- For contracts from 2027 the rules of the reform act apply. Check the details in the current statutory text.
What happens to the balance on death
In the contract you name who should receive the balance on death. This beneficiary designation is the first step, before the law comes into play. Without a clear designation, the transfer follows the contract and the general rules of inheritance, and the subsidy is then often hard to sort out.
Tax and subsidy law sit in between. Whether the allowances must be repaid is decided not by who ends up with the money, but by the form of the payout and the identity of the recipient.
Spouse, children and other heirs compared
| Beneficiary | Rule under section 93 EStG (version available today) | What to check |
|---|---|---|
| Spouse | Transfer to the spouse on death is an exception to repayment | Whether the contract provides for the transfer and how it is handled |
| Children or other heirs | A payout on death counts as harmful use and the allowances must be repaid | Ask the provider in writing for the repayment amount |
| Survivors’ pension | Exception under section 93 EStG | Whether the contract offers such a benefit at all |
The repayment amount covers the allowances and the amounts determined under section 10a subsection 4 EStG. The provider works out the exact amount from the contract data, so ask for it in advance.
Worked example of a repayment
Assumption: the balance in the contract is 50,000 euros, of which 10,000 euros come from allowances. If the balance on death is paid to a child, the allowances must be repaid under the rule described. The repayment amount is then at least 10,000 euros, and determined amounts can be added.
If the balance instead passes to the spouse, the subsidy is kept under the exception. The example shows why the designation in the contract matters so much.
Arranging the contract in advance
- Record the beneficiaries in the contract in writing and keep the provider’s confirmation.
- Ask what repayment on death would arise for each possible beneficiary.
- Check whether the transfer to the spouse is provided for in the contract.
- Align the designation with your will and your other provision, so that nothing works against each other.
- Prepare an overview for the heirs with the contract number and the provider’s contact.
Frequently asked questions
Does my spouse automatically inherit the balance?
Not automatically. The designation in the contract and the statutory rules are decisive. Without a clear designation the transfer can remain unclear, so regulate it expressly.
What about a survivors’ pension?
Section 93 EStG names a survivors’ pension as an exception. Whether a contract provides such a benefit is stated in its terms. Ask the provider before you commit.
Does this also apply to existing contracts?
Existing Riester contracts follow the earlier rules, unless the law provides otherwise. The reform act applies to new contracts from 2027. When you switch, check which rules apply to the balance.
Is a transfer to another contract a death case?
No. Under section 93 subsection 2 EStG a transfer to another pension contract of the person entitled is not harmful use. The German guide on early payout (in German) covers this case in more detail.
When the transfer to the spouse applies
The transfer to the spouse is the case for which the law makes an exception. For the balance to stay with the spouse without repayment, the transfer must be provided for in the contract and carried out on death. Without such a provision, the transfer may run differently from what you expect.
Anyone who is married should therefore not rely only on the statutory rule but name the beneficiary expressly in the contract. The designation can be changed while the contract runs, if needed. The conditions for a change are set out in the contract documents.
Survivors and existing contracts
Survivors’ pensions are named as an exception. Anyone concluding a contract with such a benefit should check whether the pension goes to the spouse, to children or to other persons and how long it runs. The answer is in the terms and not in this guide.
Existing Riester contracts are in principle not affected by the reform, unless the law provides otherwise. Before switching to the new Altersvorsorgedepot, clarify which rules then apply on death. A switch changes the question of beneficiaries, and that should not be overlooked.
What heirs should tell the provider
Heirs should notify the provider of the death promptly and present the beneficiary designation. The provider usually asks for a death certificate and proof of entitlement. Which documents are needed exactly you learn directly from the provider, because the requirements can differ between contracts.
Tax consequences in individual cases
Whether and to what extent taxes arise depends on the details of the case, such as who the recipient is and the form of the payout. This guide cannot replace an individual review. A tax adviser or the competent tax office can assess the specific case (the German tax office is the Finanzamt).
Related articles
- Retirement provision 2027: the overview of depot, Frühstart-Rente and Riester
- Altersvorsorgedepot early payout: is it possible and what does it cost?
- Payout plan in the Altersvorsorgedepot: what 20 years means
- Does a guarantee product in the Altersvorsorgedepot pay off?
- Riester contract: keep it running or cancel it?
Sources: Section 93 EStG, harmful use (version available today), Pension Contract Certification Act (AltZertG) in the version amended by the pension reform act (version from 1 January 2027).
Last updated: November 2026. This guide is general information, not individual advice.
