Inheritance tax on non-property assets

[R_Moss]

The focus of the inheritance FAQs seems to be on property inheritance with very little about the differences between French and UK law on transfer of other assets on the death of a partner.  My understanding of UK law is that all assets transferred between spouses on the death of one are exempt from inheritance tax.  This does not appear to be the case in France, with the surviving spouse receiving a tax free allowance of 76k euros, after which a sliding scale kicks in.

 

As a childless couple who will be dependent on income from our assets to supplement our pensions, this could make a significant difference to the survivor.

 

Is my understanding correct, and are there any smart but legal ways around this that we should investigate?

 

 

Richard

(still in the UK, but hoping to move to 40 or 64)

[Tourangelle]

Hi

If your French is good, have a look at this site

http://vosdroits.service-public.fr/particuliers

and look under "famille" then "succession et donation".

You seem to have done your research well. You are right in thinking that spouses are not exempt from inheritance tax here. I wonder though, whether you know that if either of you still have your parents, they would, if you died before them, be entitled to half. Also brothers and sisters, if you have inherited from your parents, would be entitled to a part of what you inherited, and you could not leave this to your spouse.

Obviously you are going to have to go and see a notaire. If I were you, I would ask about whether the communauté universelle marriage contract is for you. That way you totally bypass inheritance. It might be that it is not appropriate, only a notaire can really tell you in your individual circomstances. (things which might make it a bad/impossible route to go down include children from a previous relationship, or if you want to set up a business in France)

Otherwise you can look into donation entre epoux, which basically allows you a little more flexibility with regard to money "ownership".

I hope this helps.

[Shaun1138]

hi,

 

not too sure about the UK laws but when my dad died my mum had to prove that she had never received any lump sums from my dad before his death. apparently if she had, an inheritance tax would have been placed on the transferable portion of the property, with only a £50k allowance. this was a few years back now though.

but ive also heard recently that the UK government are looking to generalise both inheritance and capital gains tax, making them able to assess more people throughout the board. lets hope they change their minds, although it's unlikely.