Can we leave money to a French Charity? Inheritance Q&A

Charlotte Macdonald provides advice on issues that can arise with regards to inheritance regulations, and also reveals how you can leave money to a French charity after you die.

How can we plan our wills with properties in both France and the UK?

We have assets in both France and the UK (perhaps unusually, we live in France but have a holiday home in the UK). How does this dictate our estate planning?

As you have properties in both countries you need to ensure that you have wills which are going to work in the relevant country. If you have two wills, it is important to check that the two wills work with each other, eg one doesn’t accidentally revoke the other (we see this more often than you would expect).

It is also important that you take cross border inheritance tax advice, to ensure that your wills aren’t structured in such a way that will give rise to a high tax bill. Depending on your circumstances the UK/French double taxation convention 1963 may help to prevent or mitigate double taxation.

How has Brexit changes the buying process?

Now that the administrative dust is settling post-Brexit, what are you seeing in the buying process – is the paperwork more tricky, simpler or has it remained the same?

The short answer is that, in our experience, buying in France has remained the same. The notaires dealing with our clients in a purchase are not asking for additional or different paperwork from that needed prior to Brexit. The larger change has come from French property sales where our UK resident clients now need to go to the expense of instructing a fiscal representative to submit a tax return in relation to capital gains tax.

Obviously, UK nationals who wish to stay long term in France following their purchase now no longer have the right to live in France without getting a visa – which involves a lot of paperwork.

Is it easy to leave our assets to a charity?

We are British residents in Dordogne and we wish to leave a percentage of our estate to a French animal welfare charity close to our hearts. Is this straightforward in terms of the legal steps required?

Under French inheritance laws, if you have children you are not allowed to leave all your assets to charity. The maximum percentage that you can leave will be dependent on the number of children you have. So, if you want to leave a larger percentage than that specified under French law you will need to make a will in which you elect for the laws of the UK to apply (under English and Welsh law you have the freedom to leave your assets to charity).

It is worth noting that a change to French law was introduced last year which will allow your children to insist on their French inheritance rights being enforced over your French assets, even if you have made a UK law election in your will. However, this new law is contrary to EU law so it is likely to be challenged in the courts.

With regards to legal steps, the first is to ensure that you have wills in place. If you take professional help it will be helpful to instruct someone who has experience in UK/French estate planning and inheritance taxes.

Following your death, and assuming that you have a valid will in place, it will be possible for the French animal charity to inherit. There will, of course, be paperwork involved but it should not be too onerous, and a cross border solicitor can help if needed.

For more information please contact the international and cross-border team at Stone King LLP –Charlotte Macdonald, Dan Harris, Raquel Ugalde, Emma Seaton, Bryony Anning and Marina Emmanouel either by calling +44(0)1225 337599 or by emailing [email protected].