Equalization of Accrued Gains in German Divorce Law
The equalization of accrued gains is a fundamental concept in German matrimonial property law. It applies when spouses are married under the statutory property regime of community of accrued gains (Zugewinngemeinschaft), which is the default if no prenuptial agreement has been made. The goal of the equalization of accrued gains is to fairly divide the financial growth that each spouse has achieved during the marriage.
Under this system, each spouse retains ownership of their individual assets throughout the marriage. However, in the event of a divorce, the difference between the starting and ending net worth of each spouse is calculated. The spouse with the higher gain must compensate the other for half of the difference. This financial compensation is known as the equalization of accrued gains.
Some assets are excluded from this process. Inheritances, gifts, or assets acquired for personal use are classified as privileged property and are not included in the calculation. Likewise, assets owned before the marriage remain the individual property of each spouse.
Importantly, the equalization of accrued gains does not happen automatically. It must be formally requested during divorce proceedings. Alternatively, spouses may reach an out-of-court settlement to resolve the matter. Early legal advice is essential, as the outcome of the equalization process can significantly impact one’s financial future.
Please note: spouses who are not German citizens are not automatically subject to the German property regime. Whether the equalization of accrued gains applies depends on international private law or on a choice of applicable law made by the couple.