Changes to inheritance laws for French property owners

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For anyone already owning or looking to buy property in France in the next year, there are some interesting and hopefully advantageous changes coming into operation in 2015 which will change the laws that govern current French inheritance applying to foreign home owners in France.

Under current French law, French property is subject to French forced-heirship law, which in practice means the French legal system will decide who receives your property when you die (there are ways around this of course but not guaranteed). This means that your current foreign Will is probably (at least partly) ineffective if it conflicts with the French forced-heirship rules.

However, from August 2015, European inheritance rules are set to change which will have an important and beneficial impact for foreign owners of properties in France (whether permanent residents or holiday home owners). Under the Regulation, after 17th August 2015, any foreigner (this is to be confirmed but  currently the law as it stands applies to all foreigners) who has property in France, can choose either the law of the country of their habitual residence, or the law of their nationality to govern the devolution of their French estate. This ability to nominate which law applies to your estate means that forced heirship provisions will no longer apply.

Having said that, the new rules will only benefit those foreign home owners who have taken the appropriate action which is to make a Will which is valid in France stating which law will apply to their property. This could be done in a French Will or, because in France English Wills (as long as properly drafted) are valid, the nomination can be done in your English Will. Moreover, it can be done now in preparation for the 2015 changes (owners of French property must also be mindful that any nomination made now will have no effect until 2015, which means you need to consider what will happen if you die in the next two years.) If no such Will is made, then the succession of your estate will be governed by the state of your habitual residence.

For the moment, the UK, Ireland and Denmark have all opted out of the new regulation but this does not make much difference because the opt-out simply means that it is not possible to make an election under ‘British’ law for ‘foreign’ law to apply in Britain to British assets, but it does not mean that Britons (or Danes) cannot make an election under the laws of participating EU States.

This article is for guidance only – I am not a lawyer so please take specialist legal advice on all of the above before making any decisions. I work with some excellent lawyers in the UK and France should you need a referral.

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