International Estate Planning: Passing on French Property Through Your Will
According to the Government’s English Housing Survey, around 259,000 English households own a second home in Europe, with 60,000 of these being in France alone. Where a household has assets spanning two or more legal jurisdictions, careful legal planning is needed. Dealing with international property during probate can be complex with different countries having conflicting legislation on how assets can be passed down. To ensure your assets are inherited as you wish, getting your international estate planning right at the outset is essential.
In 2015, the EU Succession Regulation 650/2012, also known as Brussels IV, came into effect. The purpose of the regulation was to make the succession of an estate more straightforward following the death of an individual who owned assets in an EU member state, but who is a national of a different member state or of another country. It was meant to make international estate planning less complex and easier to administer.
In English law, testamentary freedom applies, which means English nationals are allowed to leave their estate on death as they see fit. By contrast, in most EU countries forced heirship applies, dictating who should inherit and in what proportions. This often means assets passing to children regardless of personal circumstances and preferences and may be against your own international estate planning.
Very helpful for some, the EU succession regulation can override forced heirship regimes by allowing the succession laws of the deceased’s habitual residence to govern the succession of their estate on death.
An individual can elect the law of their nationality to govern the succession of their estate on death. It is not necessary to be an EU national to make an election. An English person may elect for English law to apply to the succession of their French property, for example. This will be part of the will writing process when undertaking your international estate planning.
In English wills, it is often the case that individuals will leave all their assets to their spouse and then to their children in equal shares on the death of the surviving spouse.
Under French succession law, inheritances must pass along the bloodline. Children are protected heirs and must inherit between 50% and 75% of your estate (depending on the number of children) regardless of whether a spouse survives you.
Article 913 of the French Civil Code
For English nationals wishing to leave their French estate in the same way as their English will, the EU succession regulation has provided a useful mechanism to avoid the forced heirship rules. However, in November 2021, a change was made to Article 913 of the French Civil Code that impacts the regulation and can affect international estate planning.
This change affects English nationals who own French assets and who have made an election for the law of England and Wales to apply on their death. The change in law applies where, at the date of death, the deceased, or any one of their children, is a resident or national of an EU member state.
Where article 913 applies, and an English national has elected in their will that the law of their nationality should apply, the terms of their will are only carried out if the will is in accordance with the French forced heirship rules, or if their children agree with the terms of the will. It may therefore be helpful that your children are aware in advance of your international estate planning for your wishes to be executed.
Following death, it is up to the French notaire carrying out the administration of the estate in France to contact the children and obtain their agreement before following the terms of the will. This amendment of Article 913 is incompatible with the EU succession regulation. Because of this, it is expected that a case will be taken to court in due course so that clarity can be provided by the European courts.
Until that occurs, careful consideration should be given when dealing with the succession of your estate in France. It will be vital to understand the rules that may apply when considering how best to deal with the succession of your estate and international estate planning in general.
If you want to plan for the succession of your overseas assets, contact our team today for a no-obligation discussion. Call 01752 203500, email enquiries@GAsolicitors.com or use our online contact form.
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You can also read our recent article about trust funds here.
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