French Inheritance Rules

[Mrs Trellis]

I'm not sure the change in inheritance law will affect us, as we are married, the house is en tontine and our children will inherit anything that's left - which is what we want.

When one of us dies, will any money in the bank be split between the survivor and the children?

[parsnips]

[quote user="Mrs Trellis"]I'm not sure the change in inheritance law will affect us, as we are married, the house is en tontine and our children will inherit anything that's left - which is what we want.

When one of us dies, will any money in the bank be split between the survivor and the children?[/quote]

Hi,

      If you were married in the UK , and have not made any arrangements then any bank accounts in sole name pass under french IHT rules , ie 1 child 50/50 with spouse , 2 children 2/ 3 children 1/3 spouse, 4 children 3/4 children 1/4 spouse.  Any joint accounts are split 50/50 deceased/ spouse , then the deceased's 1/2 is split as above.

     In your case the best plan is to make mutual "donations entre epoux" (about 140€ each).   This ensures that all assets not comprising real estate - savings , investments , etc can be taken by the surviving spouse in usufruit (life-interest) - best to specify in the donation "quasi-usufruit au sens de l'article 587 code civil "  which ensures that the survivor can use all the assets as they see fit. At the survivors succession the children will get the value of whatever remains of the assets , tax free.  A straight usufruit , can be constricting.

     It is also useful to register any car in joint names .

[Mrs Trellis]

Thanks Parsnips, that sounds the best route. Funny I've never heard anyone mention all this before! Must go and see our new young notaire.

I didn't know you can register a car in both names - though after the driving licence fiasco I really don't fancy ever braving the Prefecture again. I know that a friend who had been widowed several years, remembered she hadn't changed her address for her car when she moved . When she went to correct this she was told her step children had to give permission for her to own the now elderly car.

[Val_2]

My car was registered in both names but only the CHRISTIAN name of OH appeared so after he died and I decided to trade the vehicle in for a new car, I had to get written permission from my children and from the Notaire to do so. Therefore if both names on Carte grise, make sure BOTH Christian names are on it and if only the name of the deceased appears, the survivor has to re-register the vehicle in their name costing a fee, new number plates if old style and of course, again permission to do so from other inheritors.

[Laurier]

Hi

If there are no children, Parsnips, then 100% can go to the spouse, can't it, in a normal Will, without any donations being necessary?

Just checking - in case something has changed. I also didn't know about the 10 year 'marriage regime' rule if married in the UK.

Thanks

Laurier

[parsnips]

[quote user="Laurier"]Hi

If there are no children, Parsnips, then 100% can go to the spouse, can't it, in a normal Will, without any donations being necessary?

Just checking - in case something has changed. I also didn't know about the 10 year 'marriage regime' rule if married in the UK.

Thanks

Laurier[/quote]

Hi,

      In that case, even without a will, the surviving spouse automatically inherits all the deceased's estate ,provided no parents of the deceased are still living.

       It would be wise for each spouse to make a will leaving everything to the other, just so there can be no confusion.   Their wills should also specify their wishes for their own succession  should they be the survivor, or, if they should both die in the same event (God forbid).

[Val_2]

Parsnips, just to complicate things further, our Notaire dealing with the inheritance things at the moment told me that an official UK marriage certificate is recognised as a binding contract and the ten year thing was never mentioned, considering we have owned the property for over 25years now.

[parsnips]

[quote user="Val_2"]Parsnips, just to complicate things further, our Notaire dealing with the inheritance things at the moment told me that an official UK marriage certificate is recognised as a binding contract and the ten year thing was never mentioned, considering we have owned the property for over 25years now.[/quote]

Hi,

I should have mentioned that the hague convention only applies to marriages entered into after 01/09/1992.

details here;http://www.coupleseurope.eu/en/france/topics/1-which-law-applies/

[Laurier]

Thanks once again Parsnips.

Laurier

[idun]

Oh boy, all that is still complicated. Fingers crossed that most french notaires will get to grips with this and know how to interpret it properly.

Still wondering about a future sale though. ie the husband or wife dies, and even under french law the children can no longer 'just' claim their inheritance, but what happens now if someone wants to move? Leave maybe a home that is too big, or whatever and needs to buy somewhere else. Do these new rules transfer, or not? Or will children be asking for their inheritance, or if minor the person who deals with the tutelle make sure that the money is put aside for the children.

I know that inheritance was put aside at one point as a friend's, brother's wife died, leaving him with children. I never did ask how all this worked at the time, and wish I had. This man sold the house they lived in as he got a job somewhere else, remarried and one of his children could not stand the new wife. The day they were 18 they were at the notaire sorting out their inheritance, which they got.

Now IF he had not sold up, I do believe that the child would have to wait these days, but it is that moving that I do wonder about.

Also, as was mentioned, even if there are no children involved then ascendants inherit under french law.

And I also wonder how the french will deal with the tax due on inheritance too.

Would that all was very clear, to me at least.

[lindal1000]

I'm currently going through all of this at the moment in relation to our own wills. As I have been advised we can leave all our assets to each other and the person who inherits can sell, spend all the money and in fact do as they wish with it. Inheritance tax however is not affected ..and hence in order to protect the other person from having to pay an enormous amount of tax, we have to either PACs or get married. Ascendant are not protected heirs under French law so even with a French will we would be okay. The only thing you need the UK will for is to disinherit any children.

[Val_2]

parsnips, glad you bought the item up and I read through the Hague convention (you can google to read it in an easier form) and discovered its really for recent marriages or civil ceremonies.Luckily I married in 81. One thing too I have noticed recently with references to items on vosdroits websites, it does not give the exact information and people are better off actually reading the real article on the official code civile as the vosdroits is quite misleading really. As said earlier, I feel anyone buying French property with another person and who is not married to that person or anyone buying really who is not a French national should consider protecting themselves and eventually their heirs. I have just refused inheritance coincidentally and have caused a nightmare as OH was only child and many cousins who are next in line are scattered worldwide which will prove very costly to get geneologists and translators involved.

[idun]

val2, very very confused now............why did you do that, disinherit yourself. And I don't understand why the kids wouldn't get everything IF you did that, why the cousins etc? And ofcourse what happens to the proceeds of your home if you want or maybe need to move?

Lindal, I hadn't been in France long before I realised that there was no way I would be a concubine, for all people will tell me the disadvantages of marriage, because obviously there are some, then there are, as far as I am concerned more pros to getting married when living in France. And I couldn't / wouldn't PACS, it was a good law brought in for gay couples to give them some legality, and frankly as far as I was concerned that was what it was for, why straight couples used that system is sort of beyond me as they could get married, but they did 'use' it in some cases!  I lived with my husband before we married, not the done thing where we lived at the time, but for, as I suppose in this case it would be to avoid inheritance tax,  financial reasons meant that we did the sensible thing and married.  I don't understand fancy weddings, we just got our selves along to the registry office and signed up, simple.

[WJT]

[quote user="lindal1000"]I'm currently going through all of this at the moment in relation to our own wills. As I have been advised we can leave all our assets to each other and the person who inherits can sell, spend all the money and in fact do as they wish with it. Inheritance tax however is not affected ..and hence in order to protect the other person from having to pay an enormous amount of tax, we have to either PACs or get married. Ascendant are not protected heirs under French law so even with a French will we would be okay. The only thing you need the UK will for is to disinherit any children.[/quote]

Lindal1000 I am not understanding your comment in regards to the IK will. I thought for the new EU law in August that you would need a French will stating you want UK laws to apply. Are you saying this needs to be done in the UK?

[Val_2]

Idun, let me know if you get my email and you will understand the situation a bit better. In the case of my late OH because he was an only child, the next in line are his direct first cousins as there are no parents or siblings who would have been the inheritors. Originally the half of the property that belonged to OH would have come as 25% to me and 12,5% to our children making in total his 50% ownership.

[lindal1000]

Sorry I meant to say that the only reason to adopt UK law is to disinherit children.

Idun the PACS was originally for gay couples but is now more popular amongst heterosexual couples. We prefer the idea.. just sign a couple of forms in the notaires office, no need for anyone else to even know about it. If it wasn't for the inheritance tax we wouldn't be doing it.. Having been unmarried for well over 50 years I've no wish to go down that route!

Interestingly civil partnerships are not recognized in the UK for heterosexual couples.. so we are only PACS ed in France..an anomaly that amuses me!

[idun]

Thanks, I got your email and am in the process of replying.

[idun]

 [:D]There is absolutely nothing wrong with being married, at all. I remember soon after the PACS came in seeing  first hand it being abused by a hetrosexuals who were not and never ever have been a couple, and I shall say no more than that about it, but it was.

But, by the same token,  I also thought that the PACS was excellent when it came in, as it was really for homosexual couples, and as the french had decided to make it general, rather than for a specific group, soon realised that it would be used by hetrosexual couples, but now anyone can marry, I'd get rid of it, it has no reason d'etre.

And I suppose that now you have made me think about it, it boils down to commitment and throwing one's lot in together. If a couple is committed, what difference could it make to their relationship if they married, apart from the essential of giving 'them' legal cover if anything happened and if ill then one could talk to the Doctors. Also, PACS'ing certainly doesn't cover everything either and if it is for wills, then a will, will have to be made, otherwise there was no point in PACS'ing to start with.

Unless things have changed, I do not believe that the british civil partnership works in France either if a gay couple move to France, there again, they can marry now and that surely would be acceptable.

[lindal1000]

Things have moved on Idun. A French PACs is recognized in the UK for gay couples as equivalent to a civil partnership. however as Civil partnerships are not recognized for heterosexual couples in the Uk neither is a French PACs.

We are in the middle of collecting the paperwork for the PACS now and I can tell you it is exactly the same as the paperwork we would need to get married. It also gives you exactly the same rights as if you were married in relation to most things.j

There's nothing wrong with being married at all but also many people don't want to. There are a lot of heterosexuals in the Uk that would prefer a civil partnership to marriage or a civil marriage, objecting to the patriarchy of a traditional marriage system. Even in civil marriages in the Uk the groom is still invited to 'kiss the bride'.

All the PACs does in relation to inheritance is that it means that we can leave everything to each other without the worry of inheritance tax and of course it doesn't mean you don't need a will. It isn't so much of an issue in the Uk as it is the Estate that is taxed and not the person who inherits, and also we can leave things to whoever we want.

[idun]

As you say, it works for most things, but not all and that should not be forgotten.

[lindal1000]

Although as yet I have not found anything that it doesn't work for in France, where the statute is treated exactly the same as married couples. I am happy to stand corrected on this but I have checked it with a notaire and they said they were essentially the same. It is only when dealing with the UK that I have come up against potential problems. It used to be that PACsd couples couldn't adopt, but even that has changed now.

[Mrs Trellis]

I've just remembered that I went to a talk on how French inheritance tax affects foreigners. It was by someone from a company that has offered financial advice here for many years. There was no mention at all of this ten year rule!

[parsnips]

[quote user="Mrs Trellis"]I've just remembered that I went to a talk on how French inheritance tax affects foreigners. It was by someone from a company that has offered financial advice here for many years. There was no mention at all of this ten year rule![/quote]

Hi,

     Companies here giving financial advice are mainly interested in steering people towards buying their products.  While at least some do give generally good advice , I have found, when attending their seminars etc., that their representatives' knowledge of the finer points of french tax and inheritance is not always extensive or up-to-date.

[Val_2]

Yes, I know a fellow brit who went to one of these preparation seminars and ended up being frightened to death by their so called advice.On her return she spoke to her family Notaire who re-assured her with the official French information as written down by law.She swore she would never listen to anyone again regarding legal or financial matters unless they were French and this was a lady who had lived here since the 70's,married a French person and had all her children here too!

[lindal1000]

Just back from a meeting with our French Notary. He confirmed that once we have a PACs then the default state in our position is that if one of us were to die the other would automatically inherit the other's assets in France, including property, without inheritance tax. This is because we have no children. He actually advised us to opt for UK law with regard to our wills and said there was no need for a French will.