Tax victory for UK civil partners

BRITISH civil partners who have recently paid full French inheritance tax after their partner died are to be refunded.

Budget Minister Eric Woerth has announced that the right of couples in foreign civil unions to be treated as their French equivalents will be backdated to August 21, 2007.

This date marks when pacs couples (French civil unions) received their current tax and inheritence exonerations.

Those who have already paid are eligible for refunds. A law on foreign partnerships in May stated that they would be treated as a French pacs but practical details were not given.

The back-dating also applies to tax on donations (formal gifts) for which pacs partners have a €79,222 tax allowance.

Civil partners will also be able to make joint income tax declarations for 2009 income.

The new rights mean that people in foreign civil union, like British civil partners, are no longer treated as legal “strangers,” required to pay 60% inheritance tax. France previously only recognised UK civil partnerships as a barrier to getting pacsed and UK couples were unable to separate simply to get pacsed in France.

Leading gay rights lawyer Caroline Mécary said that those whose partners died since the 2007 date who have paid tax should get a refund with interest.

Ms Mécary has been representing Jerry Lea, an Englishman who has so far paid instalments of e20,000 out of a €94,000 inheritance tax bill after inheriting his partner’s part of their French holiday home in 2008.

His case has been going through the courts, with Ms Mécary arguing that France’s (former) policy of giving no recognition to foreign partnerships was contrary to principles of international law.

“It’s good news from now on. Most civil partners will not be in the position I was in,” said Mr Lea.

Full details of civil partners’ new rights are due to be clarified further in coming weeks.