What Happens When an English Person Dies Owning Property in France?

Charlotte Macdonald is an associate solicitor in Stone King’s international and cross-border team.

Over a new 12-part series of articles, Charlotte will answer legal and practical questions that are often asked by her clients in relation to buying or selling property in France, French inheritance law, and how inheritance and capital gains tax are treated between the UK and France. 

What Happens When an English Person Dies Owning Property in France?

Here’s the scenario: Mabel has recently died. Mabel was English but had retired to France some years ago. She owned her home in France, a flat in England and had bank accounts in both the UK and in France. In her Will, Mabel appoints her daughters, Joanna and Katie, as her executors and leaves them all of her assets equally.

Mabel’s daughters need advice on what to do next.

Estate Administration (Succession) in France

Mabel’s daughters will need to appoint a notaire (French lawyer) to deal with the succession.

The role of the executor is not recognised in France in the same way that is in England, and usually the beneficiaries, or as they are more commonly referred to in France, the heirs or legataires, will be expected to sign the relevant succession paperwork.

Broadly speaking, the notaire’s work can be split into four stages. Some of these stages can be happening concurrently.

• Identify the beneficiaries
  The daughters will need to provide the notaire with Mabel’s Will and the beneficiaries’ identity documents (in this case the beneficiaries are Joanna and Katie) including passports, birth/death certificates, marriage/divorce certificates.
  The notaire will prepare the acte de notoriété which will formally recognise the daughters as the beneficiaries.
• Assets and liabilities
  The daughters will need to provide documentation demonstrating Mabel’s assets (bank statements, property deeds, life insurance etc) and liabilities (mortgage deeds, household bills, funeral fees, etc). The notaire will then produce a schedule of assets and liabilities based on the information provided. In some situation the notiare will carry out additional steps such as checking for property at the Land Registry and preparing l’inventaire to provide a correct valuation of furniture and personal belongings etc.The notaire will then provide the beneficiaries with a statement of how much the Mabel’s assets were worth at the time of her death. The beneficiaries can decide not to inherit at this stage (for example, if the value of Mabel’s debt was worth more than her assets).
• Tax
  The notaire will also prepare the déclaration de succession (French inheritance tax return) for Joanna and Katie to sign, and will help to arrange the payment of any inheritance tax due. This must be completed within 6 months if a person has died in France (this is extended for 12 months if the deceased died outside France). Unlike in the UK, it is the daughters (and not the estate) who are liable to pay French inheritance tax and any penalties for late payment.
• Distribution of the estate
  The notaire will prepare a deed to transfer Mabel’s real estate – the attestation l’immobilière. Finally, the notaire will prepare the acte de partage (this is not always required) and will distribute Mabel’s assets to her daughters.

French inheritance law and procedure: some practical points

• How long is this process?
  Succession in France usually takes around 6 to 12 months. Things could take longer if Mabel’s estate is particularly complex or if the daughters, or another person, challenge the Will or the inheritance.

• How much will this cost?
  The frais de notaire (notaire’s fees) are set by the French state and are calculated as a percentage of the estate. The notaire will provide an estimate of these fees at the outset of the matter, although as the quote is based on the value of the assets, this can’t be confirmed until the value of the assets is known. Sometimes notaires will charge an additional amount if the matter is complex.

• The daughters live in the UK, will they have to travel to France?
  No – the notaire can draft a specific procuration (power of attorney) which will authorise another person to sign any relevant documents on the daughters’ behalf. This will usually be an employee in the notaire’s office.

Estate Administration in the UK

As Mabel owned a flat and bank accounts in the UK, Mabel’s daughters will also need to obtain a grant of probate and submit a UK inheritance tax return.

It is a good idea to instruct an experienced international and cross-border solicitor to assist them to do this, as the solicitor will be able to advise the daughters on the double taxation treaty between the UK and France and will be familiar with both jurisdictions. The solicitor will also be able to assist the notaire with any relevant English law points.

At Stone King, we regularly work for people like Joanna and Katie administering UK/French estates. We work together with the notaire to ensure that the UK and French estates are administered correctly.

For more information please contact the international and cross-border team at Stone King: Charlotte Macdonald, Dan Harris, Raquel Ugalde and Emma Seaton either by calling +44(0)1225 337599, or by emailing: [email protected]

Article written by Charlotte Macdonald and trainee solicitor, Bryony Anning.