Every year, more than €300 billion in assets are transferred through inheritances and gifts in France, and nearly 45% of estates are subject to some form of inheritance tax. With rates reaching up to 60% for non-family heirs, careful planning can make a significant financial difference.
At French Tax Online, we help expats and families make sense of French inheritance law, from forced heirship and tax allowances to cross-border estate planning. Our English-speaking experts work closely with notaires to ensure a smooth, compliant, and tax-efficient transfer of assets.
What are the inheritance rules in France?
French inheritance law, governed by the Civil Code, sets strict rules on how an estate is divided after death. Unlike in many common law countries, individuals in France cannot freely decide who inherits their assets. The system of forced heirship (réserve héréditaire) ensures that a fixed portion of the estate automatically goes to the deceased’s children, regardless of any will.
The reserved portion depends on the number of children:
- One child → must receive at least half of the estate.
- Two children → share two-thirds equally.
- Three or more children → share three-quarters equally.
Only the remaining part, the quotité disponible, can be distributed freely to others, such as a spouse or non-family member, and only if a valid will exists.
When no will has been made, intestate succession rules apply automatically. The estate is divided according to family ties: children first, followed by the surviving spouse, parents, siblings, and more distant relatives. If there are no legal heirs, the estate passes to the French State.
The surviving spouse benefits from specific inheritance rights that depend on whether there are children and on the couple’s matrimonial property regime. In most cases, the spouse can choose between:
- Full usufruct (the right to use assets and receive income from them), or
- Ownership of one-quarter of the estate.
Civil partners (PACS) and unmarried partners, however, have no automatic inheritance rights unless they are named in a will or benefit from specific estate planning tools, such as assurance vie (life insurance).
For foreigners or expats with property in France, the EU Succession Regulation (Brussels IV) offers flexibility. It allows individuals to choose the law of their nationality to govern the division of their estate. However, this choice only affects how assets are distributed, French inheritance tax still applies to assets located in France.
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Who pays and on what assets ?
In France, inheritance tax is paid by each heir or beneficiary, not by the estate as a whole. The amount owed depends on two key factors:
- the relationship between the heir and the deceased, and
- the value of the assets inherited.
Close family members, such as children, benefit from generous allowances and lower tax rates, while distant relatives or unrelated beneficiaries are taxed at much higher rates.
French tax residents are taxed on their worldwide assets, meaning all property and wealth they own – whether in France or abroad – are included in the inheritance tax base.
By contrast, non-residents are taxed only on assets located in France, such as real estate, bank accounts, or business interests.
Most assets are taxable under French inheritance law, including real estate, cash, investments, vehicles, jewelry, and company shares.
However, some assets may be partly or fully exempt:
- Life insurance policies (assurance vie) benefit from favorable tax treatment under specific conditions.
- Professional assets may qualify for the Dutreil exemption, reducing or eliminating tax on business transfers.
In international cases, double taxation treaties between France and other countries, such as the United States, United Kingdom, or Spain, help prevent the same inheritance from being taxed twice.
Nevertheless, heirs must comply with both French inheritance law and the tax rules of their country of residence, which makes professional advice essential for proper coordination.
Tax rates and allowances
French inheritance tax is progressive, meaning the more an heir receives, the higher the tax rate applied. The exact rate also depends on the degree of relationship with the deceased, close relatives benefit from significant tax-free allowances and lower rates, while distant relatives or unrelated heirs are taxed much more heavily.
Each heir is entitled to a personal tax-free allowance (abattement personnel). The most common are:
- €100,000 for each child (from each parent)
- €15,932 for brothers and sisters
- €7,967 for nephews and nieces
- €1,594 for unrelated heirs
After the allowance is deducted, the remaining amount is taxed at progressive rates ranging from 5% to 45% for children and direct descendants. Siblings are taxed at 35% or 45%, while non-family members can face a flat 60% rate.
Importantly, spouses and PACS partners are fully exempt from inheritance tax in France, regardless of the amount inherited. This exemption does not apply to unmarried or cohabiting partners unless they are explicitly included in a will and qualify for specific planning tools, such as a life insurance policy (assurance vie).
These allowances renew every 15 years, which makes lifetime gifts (donations) a useful estate planning strategy. By transferring assets gradually, families can use the allowances multiple times and reduce future inheritance tax liability.
How to calculate and pay ?
In France, inheritance tax is calculated individually for each heir, not on the estate as a whole.
The process involves three main steps:
- Determine the gross value of the assets received by each heir.
- Deduct the tax-free allowance based on their relationship to the deceased.
- Apply the progressive tax rate to the remaining taxable amount.
If a child inherits €300,000 from a parent, the first €100,000 is tax-free. The remaining €200,000 is then taxed progressively, starting at 5% and increasing through higher brackets as thresholds rise.
Inheritance tax is paid to the French tax authorities (Service des Impôts) after submitting a formal inheritance declaration (déclaration de succession).
This declaration is usually prepared by a notaire, who evaluates assets, calculates the tax, and arranges payment on behalf of the heirs.
Deadlines
- If the death occurred in France → payment due within 6 months.
- If the death occurred outside France → payment due within 12 months.
Heirs may request to pay in installments or defer payment, particularly when real estate or other illiquid assets are involved. However, late payment can lead to penalties and interest charges.
Early consultation with a notaire or tax advisor helps ensure compliance, accurate valuation, and access to available reliefs or payment options – avoiding unnecessary stress or extra costs.
For expats and families with property in France, working with French Tax Online provides clear, English-speaking guidance throughout the inheritance process. Our team helps you understand your obligations, coordinate with notaires, and plan effectively to reduce French inheritance tax.
How to reduce or avoid inheritance tax ?
1. Lifetime Gifts (Donations)
Each parent can give up to €100,000 to each child every 15 years without triggering tax. By making gifts gradually over time, families can take full advantage of these recurring allowances and lower the future taxable estate.
2. Life Insurance (Assurance Vie)
Life insurance is one of the most efficient ways to transfer wealth outside standard inheritance rules. Premiums paid before age 70 are generally exempt up to €152,500 per beneficiary, and even higher amounts benefit from reduced tax rates.
3. Marriage and Civil Partnerships (PACS)
Transfers between spouses or PACS partners are fully exempt from inheritance tax. In addition, adapting the matrimonial property regime can further protect the surviving partner and simplify the transfer of assets.
4. Using a Property-Holding Company (SCI)
For real estate, creating a Société Civile Immobilière (SCI) can provide flexibility and tax advantages. It allows parents to gradually transfer ownership by gifting company shares, while keeping control of the property.
5. Plan Early
Effective estate planning takes time. By reviewing assets, making strategic donations, and seeking expert guidance, families can minimize inheritance tax legally and ensure a smooth, compliant transfer of wealth.
At French Tax Online, we specialize in helping expats and families understand the French inheritance system, coordinate with notaires, and optimize their estate planning. Our team provides clear, reliable advice in English so you can protect your family’s assets with confidence.
👉 Contact French Tax Online today to plan ahead and make French inheritance tax simple to manage.
FAQ About French Inheritance Tax Rules
How much inheritance is tax-free in France?
The amount you can inherit tax-free depends on your relationship to the deceased. Children benefit from a €100,000 personal allowance per parent, renewed every 15 years. In comparison, siblings, nephews, or unrelated heirs receive much smaller exemptions. Planning early through gifts or assurance vie policies can help maximize these allowances over time.
What is the 7-year rule for inheritance?
The so-called 7-year rule is often mentioned by expats familiar with UK inheritance tax, but it does not apply in France. In France, the comparable concept is the 15-year rule, which allows tax-free donations (lifetime gifts) to be renewed every 15 years between the same donor and beneficiary.
What is the best way to inherit a house in France?
The most efficient way depends on your family situation and tax objectives. Many families choose to hold property through an SCI (Société Civile Immobilière) to make future transfers easier and tax-efficient. Others use life insurance or lifetime gifts to reduce future inheritance tax liability. Each approach has different tax implications, so it’s best to seek advice before structuring ownership.
How to avoid double taxation on French inheritance?
France has double tax treaties with countries such as the United States, United Kingdom, and several EU nations to prevent estates from being taxed twice. These agreements determine which country has the right to tax specific assets. For example, French real estate is generally taxed in France, but credits may apply in your country of residence.
Do stepchildren or unmarried partners inherit under French law?
Stepchildren do not automatically inherit under French inheritance law unless they have been legally adopted. Similarly, unmarried partners have no legal inheritance rights unless named in a will or designated as beneficiaries of an assurance vie policy. PACS partners, however, benefit from a full inheritance tax exemption.
What documents are needed to declare inheritance in France?
The déclaration de succession (inheritance tax return) requires an official death certificate, the deceased’s will (if any), an inventory of assets and debts, and supporting documentation for all property valuations. A notaire typically prepares this declaration and submits it to the French tax office (Service des Impôts).
What happens if you inherit assets from France while living abroad?
If you are a non-resident beneficiary, you may still be liable for French inheritance tax on assets located in France, such as real estate, business interests, or bank accounts. However, your home country may provide tax credits under a double tax treaty to offset French tax already paid.
What are common mistakes to avoid in French inheritance planning?
- Not making use of the 15-year donation rule.
- Failing to plan for non-French heirs or mixed-nationality families.
- Overlooking life insurance advantages (assurance vie).
- Ignoring cross-border tax treaties.
- Waiting until it’s too late to adjust ownership structures.