Don't Get Caught Out By French Succession Rules

28 January 2009

Kent lawyer reports on a worrying trend

People considering buying a property in France are overlooking a key issue – their Will, says Kent lawyer Sarah Bogard who has just hosted a stand at the popular France Show at London’s Earls Court.

Sarah, fluent in French and an associate solicitor specialising in French property matters at leading regional law firm Furley Page, commented: “Many of the people I spoke to who were looking for advice on buying a property, or already owned a French property, admitted that they’d completely ignored the fact that they needed to re-think the structure of their Wills.

“The inheritance and tax laws in France are very different from English law. An English Will could deal with French assets - but only if it complies with French succession rules. In some cases a French Will may be preferable. ”

Don’t get caught out. Four important facts to bear in mind are:

• French law protects family members from being disinherited
• Since August 2007 transfers of French assets between spouses on death are fully exempt from French inheritance tax – currently not the case for civil partners
• Practically the whole value of French assets transferred to a stepchild are caught by a 60% French inheritance tax charge
• The same high rate applies to a transfer to a civil partner as currently, a civil partnership in France isn’t recognised to give the same tax treatment as between spouses

Joining Sarah on the stand was colleague Simon Ludden, head of Furley Page’s financial services team, who answered visitors’ queries about the current Euro exchange rate and bank base rate and the impact on their savings and pensions if they moved to France.

Simon’s advice was to set up a portfolio to provide a good income in tough economic times,  pointing out that in most cases pension funds could be transferred to Euro-based funds.

For further information on French property issues contact Sarah Bogard on 01227 763939.

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