Welcome to our comprehensive Guide to Inheritance Laws and Taxes in France.
There are few subjects that provoke more discussion and confusion amongst international owners of French property than the inheritance laws of the country.
These laws are complex and can sometimes cause difficulties because of their rigid nature and the taxation liabilities that can arise.
In particular, there is no freedom of testamentary disposition in France, as the law grants specific and entrenched rights of inheritance to the children.
There is a strong historical tradition to this approach, based on a desire to protect the interests of the family.
Accordingly, if you own French property you are not, per se, completely free to dispose of your property in the way that you might wish, say, through a will.
Hitherto, one of the biggest problems has been the limited recognition of the surviving spouse in French inheritance law, and this has caused a great deal of anxiety to many international buyers.
In recent years there have been significant changes to the law, to the extent that the average married couple from abroad should have few concerns.
Moreover, in 2015 new European regulations came into effect which grants individuals the right to elect by Will the succession laws of their nationality.
This change does not affect French inheritance taxes, but there is no liability for inheritance tax between and man a wife, or those in a civil partnership. There are also reasonably generous tax allowances for children.
Even if you may be potentially liable to inheritance tax, there are numerous methods that can be used to protect your surviving spouse, retain control of your property, and transmit family wealth to your children.
Nevertheless, you would be wise to start off on the right foot, anticipate your own mortality, and plan ahead.
If you are not married and living in free union, or you are married with children from a previous relationship, it is particularly important to give thought to inheritance planning, in order to secure greater control over your estate, plan an orderly inheritance, and reduce the potential inheritance tax liability of inheritors.
Tax considerations apart, France is plagued by legal disputes between inheritors, which often drag on for years, so some steps to avoid acrimony and deadlock would be well-advised.
It is a point often overlooked by international advisors, whose main expertise and interest is, not surprisingly, taxation issues.
Our review of this topic is divided into three main sections:
We do not deal with death procedures in the guide, but the matter is covered in a Newsletter article we published at Death Procedures in France.
Of necessity, this can only be a review of the main rules of inheritance law and taxation. Every case is different, and family affairs are rarely determined by a mere consideration of the legal or fiscal implications.
We do not believe you need to spend a fortune to get good advice, and the notes in these pages should stand you in reasonably good stead for many questions.
Nevertheless, make sure you do take advice, at least from a good French notaire, whose professional role is inheritance matters.
That said, in our experience a surprisingly high number of notaires are not entirely competent to deal with international property owners, and if you consider your circumstances are complicated, or you are not confident of the advice being given by the notaire, then discuss your circumstances with specialist international legal or financial advisors.
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