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Would getting married help inheritance position?


Montcigoux
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My partner is about to buy a house in France for us to live in as our main home. It will be bought in his name only as the purchase money is his and is his only house. We are not married and he has two lovely adult daughters from a previous marriage. I don't want to disinherit his daughters and I want the house to go to them as it would under French law anyway I think. But if my partner were to die first is there any way he can leave the house for me to occupy even for a period before it passed to his daughters? Also without making their tax position any worse than it would have been had they inherited immediately? We could marry before the house purchase if that would help. The promis has not been drawn up yet. Any ideas would be gratefully received.
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Here are some quotes from the sticky http://www.completefrance.com/cs/forums/641727/ShowPost.aspx in this section:[quote]Non-common children and descendants

The deceased person may leave

children not stemming from the marriage, for example a child from a

previous marriage, an illegitimate child, or a child adopted solely by

the deceased. The surviving spouse receives ownership of a quarter of

the estate calculated in accordance with new Article 758-5 of the Civil

Code. He/she no longer has the option of selecting total usufruct, which

may have disadvantages where the spouse is relatively young in relation

to the children of a previous marriage.[/quote][quote]Temporary accommodation right

Regardless of the marriage scheme,

the surviving spouse enjoys a free right of undisturbed possession of

his/her home and the furniture in it. This only relates to the home

actually occupied by the spouse as the principal residence on the date of the death.

From 4th December

In

respect of any succession opened with effect from the publication of

the new law in the official journal, i.e. 4th December 2001, the

surviving spouse enjoys free right of undisturbed possession of his/her

home and the furniture in it for one year. This right is his/hers

regardless of the heirs or

legatees. The benefit of this right is granted by law and order and cannot be removed by a contrary wish of the deceased.

Procedures

This

temporary right can be exercised regardless of whether the married

couple are the owners or tenants of their principal residence. If they

were joint owners or if the property came from the estate of the

pre-deceased spouse, this right takes the form of free undisturbed

possession of the home and the furniture in it. If they are tenants, the

rent will be reimbursed by the estate to the surviving spouse as and

when it is paid.[/quote]so it looks like if you married you would have a year - but you really need to read it all and follow the link to make sure nothing has changed since I copied it from the notaires' site.

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Look at the use of usufruit for you and nu proprieté for the children.  My understanding of this is that a usufruitier cannot be "unhoused" unwillingly but does not "own" the house.  It is not a very common arrangement in the UK, but is used in France.  Don;t know if it can be used if only one of you owns the house .....  BUT please speak to your notaire about this BEFORE you sign the compromis.

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[quote user="Montcigoux"]My partner is about to buy a house in France for us to live in as our main home. It will be bought in his name only as the purchase money is his and is his only house. We are not married and he has two lovely adult daughters from a previous marriage. I don't want to disinherit his daughters and I want the house to go to them as it would under French law anyway I think. But if my partner were to die first is there any way he can leave the house for me to occupy even for a period before it passed to his daughters? Also without making their tax position any worse than it would have been had they inherited immediately? We could marry before the house purchase if that would help. The promis has not been drawn up yet. Any ideas would be gratefully received.[/quote]

Hi,

 The most satisfactory solution for you , without a doubt, is to marry in the UK before buying, and at the time of purchase have the notaire draw up a "donation entre époux" , this gives the surviving spouse (at the succession) a choice of how to inherit the deceased's estate, including everything, including the house , in life interest. If the estate is large (more than about 320 000€  --their combined tax-free allowances, at todays regs)  the daughters might be liable for some inheritance tax , on the value of their "bare-title", but this would not be very much, and can be postponed until they take possession of the estate at the second death.   At the death of the surviving partner the life interest is extinguished and the estate passes to the children without tax.

     As anything passing from you ,as step-parent, to the daughters would (present rules) be taxed at 60%, it would be wise to put the maximum of your possessions , bank accounts ,  car , investments etc. into your husband's name before becoming french resident. This would not affect your rights in the event of a marriage break-up, and as you see above, you would , as survivor have a life-interest in everything.

   When you have the "donation entre époux" drawn up,  if you specify that all non-real-estate is taken in a "Quasi-usufruit au sens de Article 587 code civil", this ensures that you can use all cash and investments without restriction. 

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The whole point of not being able to take a life interest when its a second marriage is that its unfair on the children from the first marriage to have to wait for the death of the second spouse, who could be a lot younger than the first spouse and even in some cases younger than the 'children'.   Isn't what you suggest, parsnips, making those children do exactly that - which apart from being what the OP didn't want to do, could be

challenged by those children?  Rightly so, in my opinion, in a case such as the OP's where the house

is being bought by one person with no contribution from the second

spouse.

Its an emotive subject so I hope I haven't caused offence by the above comments as I don't mean to and I do know its a difficult one to get 'right'.  

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No offence taken. But in England  as opposed to Scotland , France and some other european countries you are able to leave your estate to whoever you want to. While it may be unfair to disinherit your children it is equally unfair to leave your spouse/partner without a home when you die.This is obviously a complicate issue but it needs careful planning to avoid spouses suffering especially where there have been second marriages
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[quote user="Debra"]The whole point of not being able to take a life interest when its a second marriage is that its unfair on the children from the first marriage to have to wait for the death of the second spouse, who could be a lot younger than the first spouse and even in some cases younger than the 'children'.   Isn't what you suggest, parsnips, making those children do exactly that - which apart from being what the OP didn't want to do, could be challenged by those children?  Rightly so, in my opinion, in a case such as the OP's where the house is being bought by one person with no contribution from the second spouse.

Its an emotive subject so I hope I haven't caused offence by the above comments as I don't mean to and I do know its a difficult one to get 'right'.  
[/quote]

 Such an old fashioned view and frankly for the record I'm the second Mrs RH and there were no children or property to consider with the first Mrs RH so no fear of being biased.

Many women have thrown in their lot with a previously married man who had children, why on earth shoud they be deprived of the home they made because their were children from a previous liaison ? Even the question of 'no contribution from the second spouse' is rather a moot point in many cases where they ordinarily contributed to bill payment or even in kind ( not sexual services, but perhaps entertaining clients of the spouse and his business etc, or just making a happy secure home) ....

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Rabbie, since when can you disinherit your kids in France?

 

I understand what Debra is saying. Second marriages and children in law gets very awkward.  I think that the system is still fairer now than it used to be and the children should have to wait until their parent in law dies before they get anything. However, if the remaining spouse moves, then I think it fair enough that the children get their entitlement.

 

I wouldn't live with someone in France and not be married. Get the i's dotted etc, I'm all for things being done legally, no interest in religion or weddings, just all being done legally. And the truth is that if I go before my husband I would hate for another woman to get everything and my kids nothing, that wouldn't be right. And I couldn't see him being alone for long........ and I probably wouldn't be either, if things are the other way round.

 

ps I'm a second Mrs Idun too!

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Let me admit straight away that - unlike some of those above - I am not speaking from any deep legal knowledge, and only a notaire can tell you the true situation. 

The following is simply based on to how things worked when my husband died 10 years ago, leaving children from a previous marriage as well as our own.

Montcigoux, from my experience it seems to me that your possible scenarios differ as follows:

Scenario 1, if you do not marry:

(a) On the death of their father the two children will inherit half the property each, with a certain amount to pay in tax (5% - 40%, depending on value of property).   You would get nothing, and have no right to remain in it.  

Or

(b) If your partner made a Will leaving as much as possible to you, I think the two children would have one-third of the property each (less tax), and he could specify that you were to inherit the remaining third; though, as you would not be related to the deceased owner by blood or marriage, you would have to pay 60% tax on the value of your one-third share.  (I suppose this would allow you to block the sale of the house if the children wanted to sell it, though would not necessarily give you the right to live in it.  )

Scenario 2, if you do marry:

You would be deemed to own half the house. 

As parsnips says, you can both sign a donation entre epoux, which gives the survivor the right to go on living in the house and use the furniture etc, but means the children can enjoy their inheritance only on the second death.

If you died first, your partner would inherit your share (assuming that you have no children of your own).  Then on his death the whole property would be split between his children (as in Scenario 1(a)).

If he died first, you would have the half that you own, plus half his half (making three-quarters so far); the remaining quarter would either be split equally between his two children (one eighth each), or if he specified, be divided three ways between you and them - giving them just one-twelfth each and you a total of ten-twelfths of the property. 

This means that the daughters could block the sale if you wanted to sell subsequently.   To avoid this you could offer to buy them out of their shares, and own the house outright.   However, a further complication is that if you should want to leave it to your stepdaughters on your death, they would have to pay 60% tax on it as they are not related to you by blood.

Angela

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[quote user="Russethouse"]

[quote user="Debra"]The whole point of not being able to take a life interest when its a second marriage is that its unfair on the children from the first marriage to have to wait for the death of the second spouse, who could be a lot younger than the first spouse and even in some cases younger than the 'children'.   Isn't what you suggest, parsnips, making those children do exactly that - which apart from being what the OP didn't want to do, could be challenged by those children?  Rightly so, in my opinion, in a case such as the OP's where the house is being bought by one person with no contribution from the second spouse.

Its an emotive subject so I hope I haven't caused offence by the above comments as I don't mean to and I do know its a difficult one to get 'right'.  

[/quote]

 Such an old fashioned view and frankly for the record I'm the second Mrs RH and there were no children or property to consider with the first Mrs RH so no fear of being biased.

Many women have thrown in their lot with a previously married man who had children, why on earth shoud they be deprived of the home they made because their were children from a previous liaison ? Even the question of 'no contribution from the second spouse' is rather a moot point in many cases where they ordinarily contributed to bill payment or even in kind ( not sexual services, but perhaps entertaining clients of the spouse and his business etc, or just making a happy secure home) ....

[/quote]So you're saying its ok to meet someone who has two children, owns their own house already (sorry but bill payments are a cost of living you'd have in a rented home and they don't buy you part of that) and then marries you - and that's it, you should now inherit everything?  The OP doesn't think so and didn't ask how to arrange that at all!  On the contrary, she said she wanted the children to inherit and was just concerned about being turfed out.  I pointed out that she wouldn't be for a year in any case.  Why is everyone assuming that she wants to keep the house until she dies?

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[quote user="Russethouse"]

[quote user="Debra"]The whole point of not being able to take a life interest when its a second marriage is that its unfair on the children from the first marriage to have to wait for the death of the second spouse, who could be a lot younger than the first spouse and even in some cases younger than the 'children'.   Isn't what you suggest, parsnips, making those children do exactly that - which apart from being what the OP didn't want to do, could be challenged by those children?  Rightly so, in my opinion, in a case such as the OP's where the house is being bought by one person with no contribution from the second spouse.

Its an emotive subject so I hope I haven't caused offence by the above comments as I don't mean to and I do know its a difficult one to get 'right'.  

[/quote]

 Such an old fashioned view and frankly for the record I'm the second Mrs RH and there were no children or property to consider with the first Mrs RH so no fear of being biased.[/quote]Try seeing it from the other side.  What about a woman who owns her own home and has young children from a first marriage and then remarries?  If she should die, should her children be in the position where they could be made homeless and penniless?  Where children of the step-parent end up inheriting everything?  Never mind your husband's next wife, as idun envisaged - what about a scenario where your husband's ex wife might inherit everything that was built up by you before you even met her ex-husband?  That can happen too if you have step-children .  You also have to consider putting your spouse in the position of being turfed out of their home by your own ex!

Perhaps I should state for the record that I'm probably biased then; being a second wife; married for the second time; with children from my first marriage as well as from my second marriage; with step-children and whose children from her first marriage have half siblings from their father's second marriage too.

Its complicated but with the help of life insurance you can do your best to make sure that nobody loses out on what they would have inherited before the second marriage happened and also that no surviving spouse is made homeless or put in the position of having no financial interest in their home. 

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[quote user="Mikep"]Don't marry him for inheritance and tax reasons, marry him for love.
Good luck!
[/quote]Quite.  Marrying simply to settle one's legal position seems a bit of a drastic solution to me!

For the record, speaking as the offspring - I  always told both  my parents to spend all their money and not worry about me.  I'd rather they were content and benefited from the money THEY have earned than I, who have my own income and means, since I was brought up to be self supporting - and quite right too.  If either of them had found happiness with another person in later life then that would have been great and I'd have expected them to have been left with a roof over their head, not chucked out to cope alone and homeless. 

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I do find the French system somewhat hard to accept - let me say that I have no interest in children inheriting as both of us have been married before but have no children.

Bill Gates has said that his children will get nothing from his Will, they have to make their own way in the World (no doubt though they get a nice allowance).

What about the couple who have a child that has perhaps stolen from them, been violent to them etc that they wish to have nothing to do with. My understanding of the French system is that even if they have made a Will cutting out the child (and this assumes they are an adult) the child still receives from the estate.

As for the comment marry for love why should someone have to marry they may be happy to be as they are BUT the fear of losing ones home if the partner dies must be a very worrying one.

Paul

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[quote user="Debra"][quote user="Loiseau"]

You would be deemed to own half the house.

[/quote]Why? (As for the rest of the married scenario - the law changed after 2004 which was why the sticky was posted).

[/quote]

Hi,

      If the house was in the deceased husband's sole name, and he left children from a previous marriage , and he had not made a will or other arrangement, the surviving wife is entitled to claim the house in life-interest. 

      If the partners were not married the children would inherit the house outright.

       

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[quote user="parsnips"][quote user="Debra"][quote user="Loiseau"]

You would be deemed to own half the house.

[/quote]Why? (As for the rest of the married scenario - the law changed after 2004 which was why the sticky was posted).

[/quote]

Hi,

     

If the house was in the deceased husband's sole name, and he left

children from a previous marriage , and he had not made a will or other

arrangement, the surviving wife is entitled to claim the house in

life-interest. 

      If the partners were not married the children would inherit the house outright.

       

[/quote]Are you saying that the quote from the sticky below is now incorrect because its changed again since 2004?

[quote user="Debra"]Here are some quotes from the sticky http://www.completefrance.com/cs/forums/641727/ShowPost.aspx in this section:[quote]Non-common children and descendants

The deceased person may leave

children not stemming from the marriage, for example a child from a

previous marriage, an illegitimate child, or a child adopted solely by

the deceased. The surviving spouse receives ownership of a quarter of

the estate calculated in accordance with new Article 758-5 of the Civil

Code. He/she no longer has the option of selecting total usufruct, which

may have disadvantages where the spouse is relatively young in relation

to the children of a previous marriage
.[/quote]

[/quote]

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[quote user="cooperlola"]

[quote user="Mikep"]Don't marry him for inheritance and tax reasons, marry him for love.

Good luck!

[/quote]Quite.  Marrying simply to settle one's legal position seems a bit of a drastic solution to me!

For the record, speaking as the offspring - I  always told both  my parents to spend all their money and not worry about me.  I'd rather they were content and benefited from the money THEY have earned than I, who have my own income and means, since I was brought up to be self supporting - and quite right too.  If either of them had found happiness with another person in later life then that would have been great and I'd have expected them to have been left with a roof over their head, not chucked out to cope alone and homeless. 

[/quote]I agree totally with all you said.  I said the same to my parents too.  My children don't think they have the right to expect to receive anything after my death.  We don't want them growing up thinking they don't have to work because of a future inheritance - I knew someone who had that attitude in her early 20's, not bothering to buy a house because she was in line for her parent's, who were then probably about my age now or younger!  (We've told ours that when they have all left home and are settled, we're on a fun mission to make sure they have no inheritance!)  However, I want to feel that should anything happen to me tomorrow, rather than as one hopes, much later in life, then neither they or my spouse wouldn't be in a bad position because I didn't plan carefully.

You also have to think about what if things go wrong.  What if in your scenario where one of your parents 'found happiness with another person later in life', that person got married to your parent to ensure their security and then later decides to break their vow of 'in sickness and in health' and abandon your parent in their hour of need, demanding a divorce and half of everything your parent had accumulated before they met (possibly even with your other parent) because they didn't want to become a nurse to them - leaving that parent with lots of regrets and worry and about how they had disinherited their children for someone who wasn't really worth it, worrying about fixing what they'd done instead of being able to concentrate on having the best quality of life they can in their final years?   

Its a horrible subject and a difficult one to get right or even close to right (and right is different for different people) and I'd recommend going to a notaire and discussing all the 'what if' scenarios to ensure that you are happy with what will or could happen in the one you choose.

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[quote user="pachapapa"]

Sticky 2004?

http://legifrance.gouv.fr/affichTexte.do;jsessionid=79237ABAD7ED32FF7B0C985B02481E23.tpdjo03v_3?cidTexte=JORFTEXT000000637158&dateTexte=20111031

[/quote]I was referring to the sticky that is in this forum, that I quoted from, that Quillan  made from a post I made on this subject in 2006 when I found it on the notaires' website - but which may have changed again since then for all I know.  I'm not sure where your link was meant to go but I got a massive list of laws rather than a particular piece of text.  Was it meant to go somewhere specific?  Perhaps to something that reverses the bit in the quote I posted?  Or is that just all the inheritance law in effect today?  [:'(]

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Debra, It's you view thats old fashioned - do you mean you think a woman can't have a job and contribute to a home too....? And far from not considering the woman being the better of I know several people in this position.Why anyone who had made a home with their partner should suddenly lose it, just when they probably need it most is beyond me...

You certainly do have to think of different scenario's when thinking of property and inheritance, we went through lots of different scenarios when we made our wills but that was in the UK.......and solutions were different

FWIW I have a good friend in France who has a life interest in the home she has with her partner through a PACS. The OP needs to talk to the notaire before the purchase......

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Clair put a sticky up which links to the laws in each country and shows various scenarios.  For France it seems to say the law from the 2004 sticky is still correct:

the link: http://www.successions-europe.eu/en/france/topics/in-the-absence-of-a-will_who-inherits-and-how-much/

[quote]

Where there is no will, the following principles apply to the various scenarios:

  • If the deceased was unmarried and without children,

    the deceased’s parents, together with his/her brothers and sisters, if

    there are any on the day of the deceased’s death, participate in the

    succession.
  • If the deceased is unmarried and leaves children: children inherit equal portions.
  • If the deceased leaves a spouse: The surviving

    spouse receives all the estate where the deceased has collateral

    relatives. Where there are parents, half of the estate devolves to the

    spouse and the other half to the parents.

  • The deceased leaves a spouse and children: Where

    there are children of the same parents, the surviving spouse receives,

    at his/her choice, either the usufruct of the deceased’s assets or the

    ownership of a quarter of the assets. Where there are children but not

    of the same parents, the spouse receives the ownership of a quarter of

    the assets.[/quote]
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Clair put a sticky up which links to the laws in each country and shows various scenarios.  For France it seems to say the law from the 2004 sticky is still correct:

the link: http://www.successions-europe.eu/en/france/topics/in-the-absence-of-a-will_who-inherits-and-how-much/

[quote]

Where there is no will, the following principles apply to the various scenarios:

  • If the deceased was unmarried and without children,

    the deceased’s parents, together with his/her brothers and sisters, if

    there are any on the day of the deceased’s death, participate in the

    succession.
  • If the deceased is unmarried and leaves children: children inherit equal portions.
  • If the deceased leaves a spouse: The surviving

    spouse receives all the estate where the deceased has collateral

    relatives. Where there are parents, half of the estate devolves to the

    spouse and the other half to the parents.

  • The deceased leaves a spouse and children: Where

    there are children of the same parents, the surviving spouse receives,

    at his/her choice, either the usufruct of the deceased’s assets or the

    ownership of a quarter of the assets. Where there are children but not

    of the same parents, the spouse receives the ownership of a quarter of

    the assets.[/quote]
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[quote user="idun"]

Rabbie, since when can you disinherit your kids in France?

[/quote]I didn't say that. Sorry if I didn't make it clear. Only in England of the countries I have lived in can you disinherit your children completely. In Sweden and Scotland the children are entitled to 1/3 of your estate divided between them. In Scotland the surviving spouse is entitled to 50% of your estate.

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