Changing the Marriage Regime

[Pickles]

[quote user="Tourangelle"]

[quote user="Pickles"]If you went for any "communaute" regime - there are various flavours but let's keep it as simple as possible - then yes, the surviving spouse would get the WHOLE of the property, essentially free of inheritance. However, IIRC, you would have to get your sons to agree to this, as they would in effect be disinherited in the first death. [/quote]Are you sure about this?  My wife and I adopted the same regime after we settled in France, and the question of consent from our children was never raised.[/quote]

Well, others have had the same experience as you, so perhaps I am in the minority!

[quote user="Tourangelle"]

Careful!  The basic regime is called the commanauté réduite aux acquis, it is the basic default contract, and it DOES not mean the surviving spouse gets everything.

[/quote]

Thanks for pointing this out. This is what happens when one (ie me) tries to oversimplify things! IIRC, communauté réduite aux acquis means that the surviving spouse gets the whole of the property etc which was purchased subsequent to the marriage, which hence excludes property acquired before the marriage. It is the default French contract, but is not the default contract which the French would apply to a UK marriage, if you see what I mean.

[quote user="Tourangelle"]

Also, you only need consent from children if the children are not from the marriage.

[/quote]

That might explain the line taken by our notaire. Thanks for the clarification.

[quote user="Tourangelle"]

 Otherwise it makes no difference to children from the marriage, except they inherit later (on the death of the surviving spouse) and pay more taxes, because they inherit more all in one go.

[/quote]

The essential thing here is that the route you have chosen (which is the same route that we went down) trades off "more taxation later" for children to sort out against "ease and security for the surviving spouse".

[quote user="Tourangelle"]

 I signed my communauté universelle on Wednesday, so my information is up to date!

[/quote]

Thanks again for the clarification. I think that the upshot of all this is that choice of regime is important because it affects what happens to the property and taxation on the death of each spouse, and needs to be done in an informed manner so that you are clear as to what your priorities are. Some will be concerned with tax-efficiency: others will be concerned with protecting the surviving spouse; still others will be concerned with protecting the inheritance rights of their children (eg in the event of remarriage of the surviving spouse). The choice will also be influenced to some extent by whether your are resident in France or not, and whether you intend to become resident in France in the future. Unfortunately, you also may wish to consider the ramifications (and likelihood?) of divorce - which is a whole other can of worms.

All in all, there is not "one solution to suit all requirements", but I would suggest that actively choosing a regime is probably going to give you a better outcome than allowing the default French interpretation of a UK marriage contract to govern things.

Regards

Pickles

[ebaynut]

Does anyone know if the 1% that is charged on the first death, if you register under the Universal community method, is on the full value of the property at time of death, or just half the value, as the survivor would surely already own the other half?  

Also, if you adopt the Universal community method when you first purchase a house in France, do you still have to pay for this registration?

As of course neither of these expenses are incurred in the U.K. it would be helpful to know.

Thanks.

[Pickles]

[quote user="thetwoofus"]so how does this fit,,,,  wife  and I  each have two older kids each from previous marriages, so far so good,,,,I   was a widower when we meet ,,,,and she was divorced, ok now, so we got married and a few years down the line we divorced and split.  some time later we got back together  and remarried ,,,, phew,,, now we want to live in france and start a business ,we are thinking   C/U has to be the best way to go .    but is it ???? I dunno ,,wad ya rekon....  I thankyou[/quote]

I doubt whether anyone on this list could or would even begin to presume to offer advice - as has been said before, you really need to seek professional advice and ensure that you understand the full ramifications of what happens in the event of death, split/divorce, business difficulties (a new spanner in the works), and ensure that your priorities are addressed. The key thing is to ensure that you undertand and to make sure that you've asked all the appropriate questions - and the questions that are appropriate depend on your priorities, your relationships, the extent to which you trust each other and your offspring, etc, etc.

Pickles

[Tourangelle]

Pickles, an interesting point about it not being the default marriage contract the French would apply to a UK marriage, you are absolutely right of course. In my case, although we got married in the UK, we lived in France after the wedding, and therefore it is considered to be a French marriage and therefore we were réduite aux acquis. However séparation des biens wouldn't have suited either.  As our marriage is considered a French one, anything I would inherit, even in Britain would be subject to this contract, and the notaire insisted on us signing a paper to the effect that he had informed us of this, which of course we did!  I did not enquire as to how much my husband being French came to bear on the situation!

[Tourangelle]

[quote user="ebaynut"]

Does anyone know if the 1% that is charged on the first death, if you register under the Universal community method, is on the full value of the property at time of death, or just half the value, as the survivor would surely already own the other half?  

Also, if you adopt the Universal community method when you first purchase a house in France, do you still have to pay for this registration?

As of course neither of these expenses are incurred in the U.K. it would be helpful to know.

Thanks.

[/quote]

Your change in marriage contract has to be published, I believe, so that anybody who owes you money can object, if you were trying to get out of paying them that way!  This seems quite expensive, a couple of hundred euros, I think, although having changed our contract this month, I am waiting for the notaire to send me the breakdown of the bill!

[Grecian]

Hello, could somebody please advise as to which agreement would suit myself and wife's situation.

Married with no children, so obviously no dependents to worry about after the second death.

Having read all the above, I can't really see an agreeement that would relate to our situation.

Many thanks for any advice provided.

 

[AnOther]

I'm absolutely no expert on the subject but I do know that it's not just dependants you have to be concerned with.

Others may correct me on the priority but in the absence of offspring your estate can go virtually any living relation be they a parent, sibling, cousin, what have you, the list goes on almost ad infinitum.

It's one of the reasons so many old properties fall into disrepair and ruin because often there is there is such a tangled web of inheritors that it's simply not worth anybody's time or money to sell it compounded by the fact that all parties have to agree to the sale well although I believe this is either changing or has changed.

If you truly have absolutely no relations at all then best decide where you want the estate to go then seek professional advice to ensure your wishes are met.

If not the French state probably gets the lot.

You can have my name and address if you like.............[;-)] 

[Pickles]

[quote user="Grecian"]

Hello, could somebody please advise as to which agreement would suit myself and wife's situation.

Married with no children, so obviously no dependents to worry about after the second death.

Having read all the above, I can't really see an agreeement that would relate to our situation.

[/quote]

Can't really give you definitive advice because I'm not qualified to do so, but - for example - what's up with "communaute universelle for property situated in France"? Why would that not relate to your situation? Of course it depends on what effect you want - CU basically will transfer the property to the survivor with minimal fees, and leaves a bigger tax bill to pay on the second death. It causes issues if you were to divorce ... I suggest that you talk it over with your notaire.

Pickles

[Grecian]

Ernie many thanks for the kind offer, of relieving me of my ill-gotten gains, after my last breath, not sure the wife would be too pleased though if she outlives me!

On a more serious note, obviously not having any children, would still leave the remaining spouse the threat of part of the house going to, in my case either my parents or brother, so one of the above options is still relevant. Thanks for pointing that out.

Pickles, as you say a CU would do the trick deferring the tax bill until both of us have departed, after which I guess that it is not my problem. Will certainly take advice, as you mentioned.

Thanks for the help.

 

 

[Andyphilpott]

We were in the same position as you and took professional advice which ended with a CU being fixed up. We used a firm of solicitors based in Portsmouth who advertise in Living France occasionally.

With this sort of thing I believe it is always best to leave it to the experts.

Andy

[Cardinal]

The ONLY person who can give you a definitive legal answer is an Avocat. Not a Notaire - they are NOT lawyers and not the same as a Solicitor in the UK. A properly qualified financial adviser can point you in the right direction, but beware of taking advice from Forums such as this. Every case is different and requires specialist knowledge and advice that is peculiar to your circumstance. Its worth paying for!

Also, be careful about the word "property". There is property as in house/land/etc and also property as in car/tv/furniture/pictures/jewellery etc and the rules can sometimes differ. The only thing that doesn't differ is that all property (both meanings) is taken into account for inheritance tax purposes. So before the notaire comes to value the property on the event of your spouse's demise, park the Beemer up the road out of sight!!

 

[Neb]

I was hoping that someone could help with the following as it seems to fit in with this thread:

We bought a property in France 3 years ago and had a Tontine clause inserted into the contract. Of note we are married (under English Law) and have three children (all under 8 yrs old) - none of whom are from a previous marriage. Our reasons for having a tontine were:

1) If either of us dies we would like the property to revert to the other so that the property could be sold with ease should the need for money arise. As noted the tontine essentially ignores any surviving children so the usual rules of succession don't apply. We didn't do this for mercenary reasons, we simply did it so that the surviving spouse could sell the property with the greatest ease should the need arise. I believe that buying en division would make this harder to do with surviving children as their consent would be required to sell it. The age of our children would suggest that this could be a long drawn out process.

2) We weren't really sure what to do but knew enough to know that a Tontine was only possible at the time of purchase not at a later date. We decided we could look into the matter at a later date (i.e. now) and take out the clause if need be.

We are now wondering if we did the right thing in having a tontine and whether we should adopt the French marriage regime of 'universal community' as outlined in this thread. I like the idea of a 'universal community' as there is no inheritance tax to pay (beyond the 1% transfer tax) on transferring the whole property to the surviving spouse. However, I have one question on this that I hoped someone might help with:

Although the 'universal community' overcomes the problem of inheritance tax upon death of one of the spouses, do the French rules of succession still apply? Would the remaining spouse (who now owns the property out right, received without paying inheritance tax) be able to sell the property with the same ease as under the tontine, or do the rules of succession apply and the surviving spouse is prevented from selling the property to protect the rights of the children? I guess it boils down to whether or not the 'universal community' ignores children in the same way that the tontine does?

Regards

Neb

[Jacqui Too]

Hi Neb

I have replied to your PM, Please check your messages

Chipie