3.4. Payment of Taxes

Inheritance tax is known as the droits de succession and they are payable by the beneficiaries of the estate who are jointly and severally liable for the taxes.

Accordingly, the tax authority is able to demand full settlement of all of the taxes from any one of them.

In the past, beneficiaries were obliged to pay off the inheritance taxes within six months of determination of the estate.

Clearly a problem for inheritors who may have inherited valuable fixed assets, but without cash funds to pay any taxes that may be due!

In recent years the problem has been exacerbated by the substantial growth in house prices in France.

This sometimes meant that it was necessary to sell the family home in order to pay the taxes.

As a result of legislation introduced in 2005, some relief has been granted.

Interest is charged on the outstanding sum.

Where the non-cash assets are less than 50% of the inheritance, then the taxes are due within six months of determination of the estate.

Neither is it possible to defer the payment of the inheritance taxes where the beneficiary receives full freehold title to the property. In most cases, however, the beneficiary is likely to receive only the reversionary interest, or life interest, in the property.