Separate property in marriage and cohabitation – how to protect the gift of money
Share
Updated: June 7, 2025 • Reading time: about 12 min
Table of contents
- Introduction
- What does individual property mean?
- Why are monetary gifts at risk of being divided in a divorce?
- How to write a separate-property clause
- Case studies: practical examples
- International aspects
- Tax & reporting
- Checklist before signing
- Common mistakes to avoid
- Conclusion & next steps
Introduction
When you give a large sum of money to a child who is married or cohabiting, you often want to ensure that the amount stays with the recipient even if the relationship ends. In Swedish law, this is done by classifying the gift as separate property . In this guide, you will learn why the clause is needed, how to formulate it in a Gift Deed and what international pitfalls can arise.
What does individual property mean?
Laws and basic principles
According to the Swedish Marriage Code (ÄktB) Chapter 7, individual property is property that is not to be included in future division of property. Common ways of creating individual property are:
- Prenuptial agreement registered with the Swedish Tax Agency.
- Terms in a will, insurance or deed of gift.
- Foreign “prenuptial agreements” (sometimes recognized).
For cohabitants, there is no formal division of movable property, but the Cohabitation Act divides a joint home + household goods - the privacy clause reduces the risk of the gift being mixed up with cohabitant property.
Why are monetary gifts at risk of being divided in a divorce?
The principle of marital property
All property owned by spouses automatically becomes marital property unless it is defined as separate. In the event of a divorce, the net amount is divided equally. A gift of money that lacks a clause therefore risks being included in the division of property – regardless of who deposited the money . For cohabitants, the money can indirectly affect the value of the home or household goods that are then divided.
How to write a separate-property clause
Recommended wording in English
Separate Property
The gifted amount shall constitute the Donee's separate property and shall therefore not be subject to division in the event of marriage, registered partnership or cohabitation ( Sambolagen 2003:376 ).
Step-by-step in the template
- Place the clause directly after the section on advances on inheritance.
- Add two checkboxes:
☐ shall / ☐ shall not. - Cross out the option that does not apply.
- Have the giver and recipient initial the letter in the margin.
Case studies: practical examples
Example 1: Swedish recipient, married in Sweden
Receives 500,000 SEK as a down payment on a new home. No separate-property condition → the amount becomes marital property and is divided in the event of divorce.
Example 2: Swedish recipient, cohabitant – home purchased jointly
SEK 400,000 is deposited into a joint account. Clause “shall constitute separate property” → the recipient has the right to withdraw the amount from the settlement before the equal division under the Cohabitation Act.
Example 3: Swedish donor, recipient residing in the USA
1,000,000 SEK is transferred. The Swedish separate-property clause is supplemented with “ and shall be deemed the Donee's separate property under applicable US marital property law ” to increase the chance that an American court will respect the condition.
International aspects
Different countries' views on separate property
- USA (community property states) – gifts are often considered separate property, but proof is required.
- United Kingdom – “non-marital assets” are better protected if provenance can be shown.
- Germany – Zugewinnausgleich does not take the gift directly, but the increase in value can be shared.
Therefore, the clause should be supplemented by the fact that the recipient is responsible for any registration in their jurisdiction .
Tax & reporting
Sweden
No gift tax since 2005, but the gift may trigger money laundering reporting for banks > 150,000 SEK.
Abroad
The USA has a federal gift tax (limit 18,000 USD per recipient in 2025). Write value as of transfer date in SEK and enter the equivalent USD to facilitate IRS reporting.
Checklist before signing
Amount stated in numbers and letters
Checkbox “shall constitute separate property” marked
Any note about the law of the recipient's home country
Signatures with dates
Digital copy saved + backup
Common mistakes to avoid
- Empty checkbox – leaves room for interpretation.
- No currency indication – complicates foreign transactions.
- Untranslated footnote – court abroad may ignore the clause.
- Lack of tracking – money is mixed with marital property → difficult to prove origin.
- No advice in the recipient country – local regulations may require registration.
Conclusion & next steps
A separate-property clause is the simplest and cheapest insurance to ensure that a gift of money is not divided in the event of divorce or separation. By using a legally reviewed Gift Deed template in English, you protect the recipient both in Sweden and abroad. Do you need such a template? Click here to download it directly for 49 SEK and fill it out in five minutes.
