French residents receiving an inheritance from the UK You do not need to pay any French succession tax, provided the deceased was UK domiciled and there are no French assets. The estate will have been subject to UK tax.
French succession laws
French inheritance tax and succession planning go hand in hand. Succession laws apply to the worldwide assets held by anyone domiciled in France. The tax liability falls on the beneficiary and is applied to all the bequests and inherited rights of the deceased's estate.
Inheritance Tax in France is payable by people who inherit assets or receive gifts from French residents and is calculated on a progressive banding scale. This is unlike UK Inheritance Tax, which has a flat rate of 40% on all assets above £325,000 or £650,000 for married couples.
It is important to seek specialist advice in relation to both jurisdictions, to ensure that the most suitable arrangements can be put in place for a family's assets. French Wills – are they worth it? It may come as a surprise to many that an English Will is normally valid in France.
When someone living outside the UK dies. If your permanent home ('domicile') is abroad, Inheritance Tax is only paid on your UK assets, for example property or bank accounts you have in the UK. It's not paid on 'excluded assets' like: foreign currency accounts with a bank or the Post Office.
If you're a UK citizen who's moved to Australia permanently, you must declare a domicile; Declare UK Inheritance Tax lifetime gifts; Transferring to your spouse is exempt; Secure debt against your property.
If you receive a gift or inheritance valued at more than $100,000 from a non-US person (or their estate), you will need to file IRS Form 3520: Annual Return to Report Transactions with Foreign Trusts and Receipt of Certain Foreign Gifts at the same time as your individual income tax return.
Succession law and forced heirship in France
Children are protected heirs and must inherit between 50% and 75% of your estate (depending on the number of children). You can only leave the 'freely disposable' part to your spouse or PACS (civil) partner.
In addition, it is strongly recommended to file the Will with a Notaire who will register it with the central index in France to trace it after your death. The original Will is kept by the Notaire who registers it and will be opened and register after death by the same Notaire.
There are currently no restrictions on foreigners buying property in France³, however, you may find the process a bit more difficult as a non-resident. This means quite a lot of paperwork and due diligence. If you're working with a real estate agent, the process is likely to be relatively straightforward.
French double tax treaties
Since December 2009, the UK and France have had a double taxation treaty in place which means that you can legally avoid being taxed for the same income in both countries – however you will have to pay tax somewhere.
Each individual has their own NRB which is £325,000 for 2023/24. Any part of the estate up to the NRB threshold is chargeable to IHT at a rate of 0%. Any part of the estate that exceeds the NRB threshold is usually chargeable to IHT on death at 40%.
France and the UK have a specific tax treaty on inheritances, designed to avoid double taxation. Both countries tax worldwide assets but under this treaty, UK nationals who are long-term residents of France are deemed to be domiciled in France for inheritance tax purposes.
Settling an inheritance requires 4 steps
In case of a delay, an interest of 0.20% per month is due to the tax authorities (in addition to a penalty of 10% if the delay goes beyond six months).
If you own property or other assets in France, it is important to make a Will covering those assets to ensure they are distributed to your chosen beneficiaries in the event of your death.
Can foreigners in France inherit family assets in France? Yes, there is no restriction regarding the family assets inheritance for foreigners. The same French Inheritance Law applies in the case of non-residents in France. You can discuss more on this topic with our attorneys in France.
Applicable foreign inheritance laws in France
French inheritance law recognizes wills drawn up in other countries as long as they conform to the legal standards of that country. This means that foreigners living in France don't have to draw up a French will.
The members of the third estate had to pay direct tax to the state known as 'taille'. Indirect taxes were imposed on tobacco, salt and many other everyday items. Thus, the third estate was seething with financial difficulties. There was the rise and emergence of many social groups in France in the eighteenth century.
Children - if there is no surviving married or civil partner
If there is no surviving partner, the children of a person who has died without leaving a will inherit the whole estate. This applies however much the estate is worth. If there are two or more children, the estate will be divided equally between them.
The members of the first two estates, that is, the clergy and the nobility, enjoyed certain privileges by birth. The most important of these was exemption from paying taxes to the state.
There are no inheritance or estate taxes in Australia.
More In Forms and Instructions
U.S. persons (and executors of estates of U.S. decedents) file Form 3520 to report: Certain transactions with foreign trusts. Ownership of foreign trusts under the rules of sections Internal Revenue Code 671 through 679.
$10,000 in one financial year. $30,000 over 5 financial years - this can't include more than $10,000 in a single financial year.