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 9th February 2010
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 French inheritance tax to be abolished between married couples in France
French president Nicholas Sarkozy has very quickly tabled a new law which makes considerable changes to French Inheritance Laws (note the word Inheritance and not Gifts Tax). Whilst the proposals have to go through the Parliamentary process the current majority means it is likely to be adopted. It is always good news when they raise the limits on any Tax especially a voluntary tax such as French Inheritance Tax. (With careful planning you can reduce or even remove any liability). What has not happened? For many UK residents moving to France one of their concerns is the forced succession laws. This has not changed and they still remain. What has happened? There have been minor changes but the two big changes are: 1) Inheritance Tax between married couples and those with a PACs (Pacte Civil de Solidarité) agreement on first death is to be abolished. This is good news. As an example, if neither partner has children and consequently has a freely disposable estate AND provided they take the right advice according to their personal circumstances they can leave assets to each other on death with no liability to French Inheritance Tax. This is a breakthrough as previously there were upper limits. Another example is the Tontine Clause which is much cheaper (usually free to insert in the property contract) and easier to arrange is now much more attractive than previously. Until the proposals take effect with a Tontine Clause you can trigger an Inheritance Tax liability on first death. 2) The inheritance allowance per child (of the deceased) is increased to from €50,000 to €150,000. Another attractive option is that the Gifts allowance per child is also increased to this level. In summary the proposals are good news but it is still as important to get advice from persons that understand the changes and how they may impact on you and your family to ensure you are not deferring the liability by passing assets to the surviving spouse or partner but using it to everybody’s advantage. Duncan Campbell, Associate Director, Siddalls For more information on the French taxation system or any other financial planning issue contact us: Siddalls (UK Head Office) Tel: +44 (0) 1329 288641 Email: enquiries@siddalls.net Website: www.siddalls.net Authorised and Regulated by the Financial Services Authority. Siddalls is a trading name of John Siddall Financial Services Ltd. Independent Financial Advisers, John Siddall Financial Services is a wholly-owned subsidiary of the IFG Group Plc. Download the Siddalls booklet ‘Help with living in France’ by clicking here. See also: Top tax tips Tax Zone Home Page Looking for a property in France? Use FrenchEntrée's Property Finders to help you find your property and to help you through the buying process 
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