Understanding Inheritance Laws in France
In the UK, after a person has died, it is the estate that pays any “death duties” after an allowance and the beneficiaries receive the net proceeds, i.e. after inheritance tax has been paid. The use of a ‘will’ can enable you to leave your estate to whom you like.
In France, it is the beneficiary who must pay any tax due before being able to receive the bequest. The allowance before tax depends upon the relationship between the ‘giver’ and the ‘receiver’, or the deceased and the beneficiary. The closer the blood tie, the larger the allowance. Therefore a son or daughter would receive a tax free allowance of €100,000 from a parent but a step-son would only have an allowance of €1,794 before a tax rate of 60% commences.
This is a very different concept to our British way of thinking especially as there are strict Inheritance rules which govern who may actually receive your estate (known as the civil code). Currently children must inherit before the spouse (unless other legal instruments have been put in place) meaning that the spouse may not receive their fair share in the first instance.
Our mindset, is that we wish to be free to dispose of our assets to whom we like, and certainly our spouse or partner before the children. The most common difficulty is when there are children and/or stepchildren and the steps you know you can take to make sure all receive their fair share.
Our separate factsheet on taxes list the allowances for inheritance purposes for different beneficiaries.
It is vital that clear advice is sought before putting any plans in place for your life in France so that there are no nasty surprises later.
The making of a ‘will’ in France or a ‘testament’ is normally done through a notaire but understanding what needs to go into a will to achieve your aims is paramount.
We can help you understand your existing position, the taxes applicable and the changes you can make in order to retain the lost control over your assets during your lifetime and minimise any taxes for your loved ones thereafter.
The information on this page is intended only as an introduction only and is not designed to offer solutions or advice. Beacon Global Wealth Management can accept no responsibility whatsoever for losses incurred by acting on the information on this page.