Hi,
Sorry if this is an old chestnut but…
My nephew (French resident) will be receiving an inheritance from his grandmother.
I would like to find an advisor for him, so that he can be prepared to receive (about 60k ) and not be taxed in France on the already taxed (in UK) funds.
Ideally a person in the Toulouse area.
Thank you
Also, if you have any experiences to share on this subject, I’d be really interested.
Do you need an inheritance specialist for this? I would have thought this is relatively straightforward as it a well trodden issue. Book an appointment at your hôtel des impôts and say it is an international tax matter, or use the contacts in the link.
Basically it has to be declared, you will get credit for anything paid in UK, but if French liability is higher then you will have to pay the difference.
Here is the info in English, although better in French.
True if Richard’s nephew’s Grandmother has already passed away. But if not there may be some planning that can be done to minimise the inheritance tax on both sides of the channel.
Would be interesting to know the outcome. I don’t pretend to have any idea, but I have read about similar things in other forums, which have suggested if the relative who passed away has no assets or connection (i.e. was never a resident) within France, then the estate is treated under UK tax law (even if there’s nothing to pay), and would not be liable for tax in France, although that might apply only up to a certain threshold.
The other thing I read is that a lot of so called ‘tax experts’ are misinformed and have given contradictory information to one another. I would ask at the local tax office (although depending to who you speak to, I still wouldn’t assume they are 100% knowledgeable in this area)…
Surely that relates to the deceased? If you receive an inheritance in France you have to declare it and may, or may not, have to pay additional tax depending on the circumstances of what has already been paid.
I have recent, first hand experience of this and hope the following may help -
Your nephew needs to make an inheritance declaration by completing and returning the required forms in this link -
https://www.impots.gouv.fr/international-particulier/when-and-where-declare
Just to add that I only found out about this process outside the stated time period so my application was late. That did not cause any problems and I found the office staff most helpful when I needed to contact them.
They also provided me with exemplars to assist form filling,
As inheritance tax will have been paid in UK, there would be no tax to pay on this sum in France.
Whether the beneficiary receives their inheritance into a UK or French bank account, I suggest they ensure this sum /legacy is clearly referenced on a bank statement (and the ‘gain’ can be explained/evidenced) as financial institutions are likely to carry out money laundering checks before savings/investments are made.
perhaps though, as @JaneJones has outlined under the France/UK Double Taxation Convention and assuming French residency and completion of the procedures and formalities under the convention:
Many thanks to everyone here for your advice.
So I understand that he needs to go to him hotel d’impots.
Do you know which papers he will need to show them to demonstrate how much uk tax has been paid?
Will these papers need to be translated?
Would his tax liability decrease if he received the sum as a minor?
Thanks again
Great links by the way, thanks…
Which prompts the question
The grandmother died, my nephew’s mother had already died, my nephew is therefore a “direct heir”?
Who paid this tax? The Executor or the recipient of the inheritance?
I’m not sure that holds any relevance.
The estate of the deceased paid the tax in th uk
so, in effect, the inheritor has not paid any tax personally in the UK as a consequence of this inheritance?
Take the probate papers, and if you can do your own translation that might help. You may not need anything of course!
I haven’t gone further into the link which gives you the forms which might prompt the need for other documents.
Here are more details of my experience if it helps anyone in a similar situation.
I only had dealings with the Impôts des Non-Résidents (office at Noisy Le Grand - see link in my earlier post) and not my local tax office.
Déclaration de succession is registered by completing forms -
2705-SD to provide details of the deceased, and
2705-S-SD for details of the déclarant, beneficiaries, assets and liabilities of the estate and an affirmation of sincerity.
I am a French resident and the deceased was resident in the UK where he died. The forms were completed in French and values reported in euros.
Les Impôts Non Résidents accepted the forms and sent me a certificat de non-exigibilité de l’impôt.
@JaneJones referred to the ‘probate papers’ - a beneficiary would usually receive related estate paperwork/final accounts on completion of the administration process.
A complex estate or one requiring the sale of property might not be settled within 12 months which is the deadline for declaring the inheritance in France.
The paperwork which will help the form filling includes -
The Grant of Probate - giving details of the deceased, executors and value of the estate at death
Probate valuation - listing assets and liabilities at date of death.
Form 2705-S-SD requires details of e.g. bank accounts, property, other assets.
For each, I converted the value from pounds to euros using the exchange rate at date of death.
HMRC inheritance tax forms were completed and submitted by the executors who, on behalf of the estate, paid IHT.
On form 2705-S-SD I included the amount of IHT and where it had been paid - no further proof of payment was requested.
A copy of the Will - giving the names/addresses of beneficiaries and their share of the estate.
2705-S-SD asks for names/addresses of all beneficiaries and their relationship to the deceased.
Why should France have all these private details of an estate, much of which may have nothing to do with the particular beneficiary of oerhaps a very tiny part of it, resident in France?
Also wondering what laws or treaties actually govern this. Does it all have to be covered by a double taxation agreement, in order for a beneficiary not to have to pay tax where inheritance tax has already been paid at origin? Unless someone is very rich and ties up their money in opaque structures in obscure jurisdictions, it sounds like tax on giver and receiver could annihilate most estates.
Yes, I followed this idea, but just need to make sure everything is nicely tidied up.
I too have my reservations about the truth, the whole truth, and nothing but the truth, of information which comes out of the mouths of officials and functionaries - so many times I have had different official departments arguing completely contradictory things between themselves, each calling the other ‘ill-informed’…
So I value hearing about peoples first hand experience and references to texts.
Thanks
This is the requirement of declaring the inheritance in France.
Inheritances from the UK are only taxable in the UK (1963 Estate Double Taxation Treaty).
The estate pays UK IHT, distributions are made to the beneficiaries, then no further tax is due irrespective of whether you are a UK or French resident.
@Sarah_Williams would you not also agree that much of the need for a French resident to declare all is one of transparency?
Even though, under the aspects of a DTT, no tax may be due, the sudden appearance of a (potentially) significant amount of funds in an account could be misconstrued if, unbeknown to the holder of the account, investigations were ongoing elsewhere for an entirely unrelated reason.
Yes totally, @graham and hence the importance of such funds being clearly referenced on bank account statements.
Hi Sarah, thank you for the information. I’m in nearly the exact same postion as this and was hoping to get further advice about filling in 2705-SD and 2705-S-SD. In my relative’s estate there was no IHT to pay after assessment by HMRC and we have a letter from them giving us clearance. The question I have is how I would write / explain this on these forms? Did you make any specific mention of the double-taxation treaty on the forms you submitted? Thanks