French inheritance tax

When are French droits de succession payable?

French inheritance tax (droits de succession) is a separate issue from inheritance law, which determines how property is passed on.

For example, an estate may be governed by the law of England and Wales or Scotland, but still be subject to French inheritance tax.

In cross-border situations, taxation depends in part on whether an inheritance tax treaty exists between France and the other country. France does not have a specific inheritance tax treaty with the UK, so standard domestic rules generally apply.

When is French inheritance tax due?

Whether French inheritance tax is payable depends on where the assets are located and where the deceased and beneficiaries are tax resident.

If the deceased was tax resident in France, beneficiaries are generally liable to French inheritance tax on worldwide assets, unless an exemption applies.

If the deceased was not resident in France, French tax may still apply to assets located in France, such as property.

Inheritance declarations must usually be made even where no tax is ultimately due. The main exceptions are small estates, notably where the total value is below €50,000 for close family members (such as children or spouses), or €3,000 for others.

How is inheritance tax calculated?

Where a notaire is involved (as is usually the case for estates including French property), they will establish the total value of the estate, including assets in France and, where relevant, abroad.

Certain deductions are allowed before tax is calculated. These can include debts outstanding at the time of death, certain funeral costs, costs linked to administering the estate, and gifts to recognised charities. A 20% allowance may also apply to the value of the main home if it was shared with a spouse, civil partner or dependent child at the time of death.

Some assets may benefit from partial or full exemptions, including certain historic properties, forests, farmland, or business interests, subject to conditions.

Once the net estate has been calculated, inheritance tax is assessed individually on each beneficiary, based on the value of what they receive and their relationship to the deceased.

Allowances and rates

French inheritance tax is calculated using allowances and progressive rates that vary depending on the relationship between the deceased and the beneficiary.

A simulator exists to check what a person may be due to pay.

Spouses and partners in a Pacte Civil de Solidarité pay no inheritance tax.

Children benefit from a tax-free allowance of €100,000 each, after which tax is charged on a sliding scale, starting at 5% and rising to 45% for larger amounts.

More distant relatives and unrelated beneficiaries are taxed much more heavily. In particular, inheritances between unrelated individuals are taxed at 60%, after a small allowance.

Higher allowances may apply in certain cases, for example for beneficiaries with disabilities. Allowances are also reduced by gifts received from the deceased within the previous 15 years.

Paying inheritance tax

Inheritance tax must generally be paid within:

• six months of death if it occurred in mainland France

• 12 months if the death occurred abroad

Payment is made at the time of filing the inheritance declaration. It can usually be paid by bank transfer or cheque, and in some cases by transferring assets (for example, works of art), subject to agreement.

It is possible to arrange staged payments over one year, or up to three years where the estate consists largely of non-liquid assets, although interest will apply.

In some cases, payment can be deferred — for example where a beneficiary inherits only the bare ownership (nue-propriété) of a property — though interest is generally charged during the deferral period.

UK considerations

If you are connected to the UK, it is important to be aware that the UK and France operate separate inheritance tax systems.

The UK may levy Inheritance Tax based on domicile and the value of worldwide assets, while France taxes based on residence and asset location.

As there is no specific UK–France inheritance tax treaty, relief from double taxation is typically provided through unilateral tax credits, rather than a dedicated agreement.

Given the complexity of cross-border estates, particularly where assets or family members are split between countries, professional advice is strongly recommended.