What is inheritance tax in France?
In short, France inheritance tax is a central part of French succession law, combining rules, allowances, and tax rates that determine how much heirs actually receive after an estate is transferred.
Inheritance tax in France, often called French inheritance tax or succession tax, is a levy applied to the assets and property of a deceased person when they are transferred to heirs or beneficiaries. Unlike some other countries, French inheritance law applies specific rules (forced heirship rules) that protect children as “reserved heirs,” meaning part of the estate must be inherited by them.
The tax is calculated on the value of the estate (real estate, bank accounts, investments, life insurance such as assurance vie, and other assets) after deducting any debts. Each heir benefits from a tax-free allowance, which varies depending on their relationship to the deceased (e.g. children have a much higher allowance than distant relatives).
The inheritance tax rates in France are progressive: the closer the family tie, the lower the rates. For example, transfers to a surviving spouse or civil partner are exempt, while transfers to children benefit from significant allowances and reduced rates. On the other hand, distant relatives or unrelated beneficiaries face much higher rates.
For expats resident in France or those inheriting French property from abroad, the situation can be complex due to double taxation treaties (between France, the UK, Spain, Portugal, and other countries). Careful estate planning is therefore essential to avoid being taxed twice and to make full use of allowances.
👉 It is also important to distinguish between inheritance tax and capital gains tax. Inheritance tax applies when assets are transferred after death, while capital gains tax is due when selling property or other assets at a profit. If you are a non-resident considering selling French property, see our dedicated article: How to Avoid Capital Gains Tax in France for Non-Residents.
Need clarity on French inheritance tax as an expat?
Navigating succession law, allowances, and international treaties can be overwhelming – especially if you own property in France or have heirs abroad. At French Tax Online, we specialize in helping expats and international families understand their obligations, optimize estate planning, and avoid costly mistakes.
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Who has to pay inheritance tax in France?
Anyone inheriting assets or property in France may need to pay inheritance tax, depending on their relationship to the deceased, the value of the inheritance, and their country of residence.
In France, it is the heirs and beneficiaries who are responsible for paying inheritance tax (succession tax), not the estate itself. This means that each person who receives assets, property, or money from the deceased must calculate their own liability according to French inheritance law.
The amount payable depends on:
- The relationship between the heir and the deceased:
- Children benefit from large tax-free allowances and lower inheritance tax rates.
- Surviving spouses and PACS partners are fully exempt from paying French inheritance tax.
- Distant relatives or unrelated beneficiaries face much higher rates, sometimes up to 60%.
- The value of the inheritance: after deducting debts and applying the tax-free allowance, the remaining share is taxed progressively according to French tax bands.
- The residency status:
- If the deceased was resident in France, all worldwide assets may fall under French succession law and taxation.
- If the deceased lived abroad but left property in France, that French property is subject to France inheritance tax.
- Double taxation treaties: Expats may benefit from agreements between France and other countries (such as the UK, Spain, or Portugal) to avoid being taxed twice on the same inheritance.
For expats, this makes estate planning crucial. Tools like assurance vie (French life insurance contracts) are often used to reduce the tax burden, as they offer specific exemptions and flexible rules under French inheritance law.
What are the general inheritance rules in France?
Here are the main rules to know:
- Forced heirship:
- Children are considered reserved heirs.
- A portion of the estate (called the “réserve héréditaire”) must pass to them, regardless of the wishes expressed in a will.
- For example, if the deceased has one child, that child is entitled to at least half of the estate; with two children, they share two-thirds; with three or more, they share three-quarters.
- Surviving spouse:
- The surviving spouse or PACS partner is not a reserved heir, but French law provides certain rights, including the ability to inherit part of the estate, or to choose between usufruct (the right to use property and receive income from it) and ownership of part of the estate.
- Importantly, spouses are exempt from inheritance tax.
- Foreign residents and expats:
- If the deceased was resident in France, the French inheritance rules apply to worldwide assets (though double tax treaties may prevent double taxation).
- If the deceased was a non-resident but owned property in France, French law and taxation apply at least to that French property.
- Wills and estate planning:
- While French law limits full freedom to distribute assets, expats from certain countries (such as the UK or other EU nations) may benefit from the EU Succession Regulation (Brussels IV), allowing them to choose the inheritance law of their nationality instead of French inheritance law.
- However, French inheritance tax rules (succession tax) will still apply to French property and assets.
- Allowances and tax:
- Beneficiaries benefit from tax-free allowances, which vary depending on their relationship to the deceased.
- After these allowances, progressive inheritance tax rates in France apply.
What is the maximum amount you can inherit tax-free in France?
The tax-free allowance depends on your relationship to the deceased:
- Children: €100,000 each, from each parent.
- Spouse or PACS partner: fully exempt from inheritance tax.
- Brothers and sisters: €15,932.
- Nephews and nieces: €7,967.
- Other heirs (friends, distant relatives, unrelated): only €1,594.
How is French inheritance tax calculated?
French inheritance tax is calculated on each beneficiary’s share of the estate, not on the estate as a whole. First, the value of the deceased’s assets, such as property, bank accounts, investments, or assurance vie policies, is assessed, and any debts are deducted. Each heir’s portion is then reduced by a personal tax-free allowance, which varies depending on their relationship to the deceased. For example, children can inherit up to €100,000 tax-free from each parent, while spouses and PACS partners are fully exempt, but distant relatives and unrelated beneficiaries receive only minimal allowances.
Once the allowance is applied, the remaining amount is subject to progressive inheritance tax rates. Children, for instance, pay rates starting at 5% and rising to 45%, while siblings face rates of 35% to 45%. In contrast, unrelated heirs can be taxed at a flat 60%. Some assets, particularly assurance vie contracts, benefit from special exemptions that can significantly reduce liability.
For expats, double taxation treaties between France and other countries may also play a role, ensuring that the same inheritance is not taxed twice.
How and where do you declare an inheritance in France?
In France, an inheritance must be declared to the French tax authorities (Service des Impôts), usually within six months of the death if it occurred in France (twelve months if abroad). The declaration is made using a succession tax return (déclaration de succession), often prepared with the help of a notaire, who is responsible for handling the estate and submitting the paperwork.
How do you pay inheritance tax in France?
Inheritance tax in France is paid directly to the French tax office after filing the déclaration de succession. Payment is usually made in a single installment, but heirs may request to pay in several installments or defer payment in certain cases, for example when real estate is involved. A notaire handles the calculation and payment on behalf of the heirs.
How can you transfer a house to your child in France, and at what cost?
You can transfer a house to your child in France either through a lifetime gift (donation) or via inheritance after death. A gift allows you to use the €100,000 tax-free allowance per parent and child every 15 years, reducing future succession tax. If the value exceeds the allowance, progressive inheritance tax rates apply. Additional costs include notaire fees and possible capital gains tax if the property is sold before transfer. Planning ahead with donations and tools like assurance vie can significantly lower the overall cost.
What is the best way to transfer property to your children (sale, gift, or inheritance)?
The best way to transfer property to children in France depends on your goals and tax planning. Gifting during your lifetime allows you to use the €100,000 tax-free allowance every 15 years per parent and child, reducing future inheritance tax. Inheritance applies after death and may result in higher taxes if the allowances have already been used. A sale is less common within families, as it can trigger capital gains tax and other costs. Many expats combine lifetime gifts with tools like assurance vie for effective estate planning.
Are there legal loopholes or mechanisms to limit inheritance tax in France?
There are no true “loopholes” in French inheritance law, since the rules are strict, especially with forced heirship protecting children. However, legal mechanisms exist to limit tax exposure. These include lifetime gifts, using the €100,000 allowance every 15 years, and assurance vie contracts, which enjoy favorable exemptions. Expats may also benefit from double taxation treaties and cross-border estate planning to optimize how assets are transferred.
Related reading
Understanding inheritance tax in France is just one part of the bigger picture. If you are a US citizen living in or investing in France, you may also face questions about income tax, social charges, and double taxation treaties between France and the United States.
To dive deeper into these topics, we recommend our dedicated guide: French Taxes for US Expats – What You Need to Know or in video:
Need clarity on French inheritance tax as an expat?
Navigating succession law, allowances, and international treaties can be overwhelming – especially if you own property in France or have heirs abroad. At French Tax Online, we specialize in helping expats and international families understand their obligations, optimize estate planning, and avoid costly mistakes.