4.9. Gift Between Husband and Wife

1. 4.9.1. What is a Gift Between Man & Wife?
2. 4.9.2. Effect of Gift Between Man & Wife
3. 4.9.3. Gift Procedure

4.9.1. What is a Gift Between Man & Wife?

In the past it has not been unusual amongst married couples to provide for the surviving spouse through a particular type of gift procedure, which is used to increase the amount of the estate left to the surviving spouse.

It differs from other forms of gifts (donations) in that it only takes effect on the death of one of the parties. For this reason it is sometimes also called a donation au dernier vivant.

The use of donation entre époux dates from a period before 2002, when the rights of a surviving spouse over the family home were significantly less than they are today. As a result of increased security to a surviving spouse, it is now less frequently used.

Where there are only children from the same marriage it rarely serves any useful purpose.

It is probably only appropriate to use this procedure in the absence of a French marriage contract, or property held en tontine.

4.9.2. Effect of Gift Between Man and Wife

It will be recollected from the section on Inheritance Rights that the rights of a surviving spouse depend on the type of matrimonial regime and the presence, or otherwise, of children.

It will be recollected, that, in the absence of a donation entre époux, provided the children were all from the marriage, the surviving spouse would only have the option of 1/4 of the freehold, or life use of the whole of the property. If there are children from outside of the marriage then the surviving spouse is only granted the right to 1/4 of the freehold, without the right to opt for life use.

In either case the surviving spouse has the right to remain in the principal home.

Remember also these amounts only refer to that part of the estate belonging to the deceased spouse, i.e. 50% of the property. So a spouse electing to take one quarter of the freehold will actually own 5/8 of the freehold of the property, with 3/8 in life use.

In the past, most surviving elderly spouse have opted for life use, as this option was normally the most fiscally advantageous option. Since 2007 and the abolition of inheritance tax between man and wife, this has become less important for most people.

Thus, a younger surviving spouse might well consider it preferable to opt for some of the freehold of the property, as it would give them stronger rights over the property, which they would need to occupy for many years to come, during which time they may remarry.

Conversely, where the estate included one or more rental properties in it, a surviving spouse might prefer the life use, from which they could then take all the income and thereby maintain their standard of living.

If there are no children, then the issue is a lot clearer. If the parents are alive, the donation entre époux enables the surviving spouse to receive the whole estate, where otherwise the parents would be entitled to up to half of it.

Where there are neither children nor parents alive it still enables a suriving spouse to prevent 'family heirlooms' being inherited by brothers and sisters.

4.9.3. Gift Procedure

If you wish to make a donaton entre époux you should contact your local notaire who will be able to process the transaction. You can do so yourself by way of a will, but you would be well advised to get professional advice from a good notaire.

The cost of making a gift between man and wife is around €250 although, on inheritance, there are notaire fees for 'opening' the gift based on a percentage value of the inheritance (in the broadly the same terms as a will).

Whilst the use of a donaton entre époux is simple and effective, the same effect could also be obtained through the use of a will. However, in either case, it pays to get a notaire to undertake the drafting.