He is a founding partner and co-managing partner of the law firm LEXWELL Avocats / Legal. Founder of the think tank NOVA ROMA, he is also co-author of the collective work "Repenser la France d’après" (Bold, 2021).

Planning your estate when you live abroad is always a delicate matter.

Whether you have assets located in France or abroad, and whether or not you have potential beneficiaries residing in France, it requires anticipating an inherently international situation whose planning can prove complex.

It is important to know that French domestic tax law (Article 750 ter of the French General Tax Code – or "CGI") stipulates that the transfer of all movable and immovable property located in France and abroad is subject to inheritance (or gift) tax in France when:

  • they are received by an heir/legatee (or donee) who is a tax resident of France
    and/or
  • the deceased was a resident of France at the time of the transfer.

However, inheritance (and gift) tax only applies to movable and immovable property transferred that is exclusively located in France when:

  • the deceased/testator was not a tax resident of France at the time of the transfer,
    and
  • the heir/legatee (or donee) was not a tax resident of France for at least six years during the ten years preceding the year in which they receive the assets.

Therefore, it is always essential – if one wishes to properly prepare an international inheritance (or gift) – to:

  • determine with certainty the place of residence of the testator and their beneficiaries, and
  • verify the existence of a tax treaty regarding inheritances between France and the country of residence of the testator or their beneficiaries. Otherwise, Article 750 ter of the French General Tax Code (CGI) will apply in full.

Primacy of International Tax Treaties: A Decisive Framework for the Taxation of Cross-Border Inheritances

Given the international nature of this type of inheritance (or gift), it should be noted that the application of French domestic tax law may be limited or tempered by the application of the provisions of bilateral international treaties concluded between France and other states regarding inheritance (or even gifts).
Due to the primacy of international treaties over domestic laws (a primacy enshrined in Article 55 of the Constitution of the Fifth Republic), the provisions of tax treaties concluded and in force for France must always prevail over the principles of taxation set forth in Article 750 ter of the French General Tax Code (CGI).

As examples (there are many more, and we cannot list them all), we can note that:

  • Pursuant to Article 9 of the French-Italian Tax Convention on Inheritance and Gift Tax, sums of money are taxable only in the state of the deceased (or donor). This may mean that they are not subject to inheritance (or gift) tax in France if the deceased (or donor) was a tax resident of Italy.
  • Pursuant to Article 30 of the French-Spanish Tax Convention on Inheritance Tax, real estate is taxable only in the state where it is located. This may mean that the transfer is not subject to inheritance tax in France when the transferred real estate is located in Spain – even if the deceased or their heirs were residents of France. However, if the property is held through a company (for example a French SCI), the transfer of the property could fall within the scope of inheritance tax in France.

LEXWELL Law Firm assists you with these procedures

Therefore, it is highly recommended that you consult a specialist advisor to determine the applicable tax regime in the event of inheritance (or gift) and, if necessary, to implement a strategy that may include international structuring of your assets, tailored to your needs and transfer objectives.