French inheritance tax and paperwork for heirs living overseas

Reader question: I live permanently in France and want to leave my French house to my daughter in Australia. Will she face problems dealing with the inheritance process from overseas?

Thankfully, as communication with notaires is generally by email, and documents can increasingly be signed electronically, it is not too tricky for a beneficiary in Australia to be able to sign the inheritance documents for an estate in France.

If they do not speak French or understand the legal process, they could use a French legal consultancy firm to help deal with the notaire and explain the process, documents and signing in English.  

Assuming you have one child, they are entitled to inherit €100,000 tax-free. Any value above that is taxed on a sliding scale from 5% to 45%, although the 20% band applies up to €552,324 (on top of the €100,000 tax-free).

Australia does not have inheritance tax, so your daughter will only pay the French inheritance tax and notaire fees for administering the estate.

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As you are a French resident, the tax is due within six months of the date of death. After that, interest at 0.2% per month plus tax penalties of typically 10% apply to overdue tax.

French tax authorities will need to know about your worldwide assets for inheritance tax purposes.

Practical things to consider in advance include making sure your will is up to date, and registering it with the notaire.

Check that it includes accurate contact details for your child, and that your local contacts know who to get in touch with. If you have assets in different jurisdictions, check that your will works for those jurisdictions.

Some, such as the UK, struggle to deal with French handwritten wills (it is possible, but not easy). In this case it can be worth having a UK will for UK assets and a French will for French assets.

You might want to clarify in your will how many children you have, as you may not have a livret de famille. The notaire may otherwise instruct a genealogist to check for other children or heirs.

Perhaps give your daughter a list of assets, liabilities, insurance and tax details etc., plus local contact information so she can pass these on to the notaire in charge of the estate.

Your child will need someone locally who you trust to have keys to your property so they can gather post and allow an agent to value the property for inheritance purposes and in case your child wants to sell it.

John Kitching is a director of French Law Consultancy Limited