French inheritance tax is one of the more frequently underestimated dimensions of property ownership in France, especially for international buyers. The applicable rate, the available allowances, and the very question of whether French inheritance tax applies at all depend on three factors : the tax residency of the deceased at death, the tax residency of the heir, and the location of the assets. This overview summarises the framework as it stands in 2026.
Our purpose here is informational. The figures and rules referenced below are drawn from the French General Tax Code (Code général des impôts, hereafter CGI). For your individual situation, the validation rests with a notaire.
Who is subject to French inheritance tax
Article 750 ter of the French General Tax Code defines three distinct situations in which French inheritance tax applies :
- The deceased was a French tax resident at death. French inheritance tax applies on the worldwide assets transmitted.
- The deceased was a non-resident, the asset is situated in France. French inheritance tax applies on these French situs assets only, including French real estate, French bank accounts, and shares in French companies.
- The heir or legatee is a French tax resident and has been one for at least 6 of the past 10 years. Inherited assets are taxable in France wherever they are located in the world, with a tax credit applicable for any inheritance tax paid abroad on the same assets.
For non-resident property buyers, the second situation is generally the relevant one : the French property is subject to French inheritance tax upon death, regardless of where the owner lived.
International tax treaties may override these rules
France has signed bilateral treaties in matters of inheritance tax with approximately 35 countries, including the United States, the United Kingdom, Italy, Sweden, Germany, Belgium, Switzerland and several others. These treaties take precedence over the rules above and contain country-specific provisions on residency, situs, and elimination of double taxation. Before any acquisition or transmission planning, the applicable treaty (if any) must be checked with a qualified tax counsel. This article does not summarise individual treaty provisions ; they vary substantially.
Two important exemptions for surviving partners
Under Article 796-0 bis CGI (introduced by the TEPA law of 2007), two categories of heirs are entirely exempt from French inheritance tax :
- The surviving spouse (married couple)
- The PACS partner (French civil union)
This exemption is specific to inheritance (transmission upon death). Lifetime donations to a spouse follow a separate regime, with a specific allowance of €80,724 renewable every 15 years (Article 790 E CGI).
An unmarried, non-PACSed partner is, for inheritance tax purposes, treated as a third party. This has substantial tax consequences (see the third-party section below).
Direct line : parents to children
Article 779-I CGI provides an allowance of €100,000 per parent per child, applicable to inheritance and to donations alike, and renewable every 15 years.
For a couple with two children, this represents €400,000 of total allowance (€100,000 multiplied by two parents and two children) before any tax applies.
Above the allowance, Article 777 CGI applies the following progressive scale :
| Net taxable share (per heir) | Marginal rate |
|---|---|
| Up to €8,072 | 5 % |
| €8,072 to €12,109 | 10 % |
| €12,109 to €15,932 | 15 % |
| €15,932 to €552,324 | 20 % |
| €552,324 to €902,838 | 30 % |
| €902,838 to €1,805,677 | 40 % |
| Above €1,805,677 | 45 % |
The same scale applies to grandchildren who inherit as direct descendants. Note that for lifetime donations, grandchildren benefit from a separate allowance of €31,865 (Article 790 B CGI), in addition to the parental allowance.
Brothers and sisters
Allowance : €15,932 per beneficiary (Article 779-IV CGI). The progressive scale is the following :
| Net taxable share | Marginal rate |
|---|---|
| Up to €24,430 | 35 % |
| Above €24,430 | 45 % |
Nephews, nieces, and family up to the 4th degree
Allowance : €7,967 (Article 779-V CGI). Flat rate : 55 %.
This category covers nephews, nieces, first cousins, great-aunts and great-uncles, and their issue, within the limit of the 4th degree of kinship.
Third parties (no family link, or beyond the 4th degree)
Allowance : €1,594 (Article 788-IV CGI). Flat rate : 60 %.
This category includes friends, godchildren without a legal relation, unmarried and non-PACSed partners. The treatment is the same regardless of the affective proximity of the relationship.
An illustrative example
The following calculation is purely illustrative and refers to a French tax resident at death, transmitting €1,500,000 of net taxable real estate to two children. Each child receives €750,000.
- Net taxable share per child : €750,000 minus €100,000 allowance = €650,000
For each child, the calculation builds bracket by bracket :
- 0 to €8,072 at 5 % = €403
- €8,072 to €12,109 at 10 % = €404
- €12,109 to €15,932 at 15 % = €573
- €15,932 to €552,324 at 20 % = €107,278
- €552,324 to €650,000 at 30 % = €29,303
- Total per child : approximately €137,961
- Total for both children : approximately €275,922 in inheritance tax
On a €1,500,000 estate, this represents an effective inheritance tax rate of approximately 18.4 %. Notary fees on the succession declaration (typically 1 % to 2 % of the gross estate) and possible droits de partage (2.5 % if heirs choose to divide the estate) are paid separately.
This calculation is purely illustrative. Individual situations vary based on the exact composition of the estate, deductible liabilities, applicable allowances, prior donations within the last 15 years, treaty provisions, and many other parameters. Only your notaire can produce a calculation that applies to your situation.
The main tools used in transmission planning
Several lawful tools are commonly used by notaires and tax counsels to structure transmission. The following list is informational and not a recommendation that any of these tools is appropriate for your situation.
Lifetime donations
Article 779-I CGI allows a tax-free donation of €100,000 per parent per child every 15 years. The other categories have their own allowances : €80,724 for a spouse (Article 790 E CGI), €31,865 for a grandchild (Article 790 B CGI), €15,932 for a sibling, €7,967 for a nephew or niece. Timing and structuring are the heart of the strategy and must be set up by a notaire.
Démembrement de propriété
The transfer of the bare ownership (nue-propriété) of an asset to children, while retaining the usufruit (right to use, occupy and collect income), reduces the taxable value of the gift. The valuation is set by a legal scale based on the usufruitier's age (Article 669 CGI). For example, at age 61 to 70, the bare ownership is valued at 60 % of the full value and the usufruit at 40 %. This is a definitive transfer of the bare ownership ; structuring is performed by a notaire and the tax consequences should be reviewed individually.
SCI (Société Civile Immobilière)
Shares in an SCI can be transmitted progressively (partial gifts every 15 years), which is operationally simpler than dividing an indivision. In some cases, a valuation discount for illiquidity may apply, subject to documentation and to acceptance by the tax administration. The SCI is a tool whose effectiveness depends on the wider patrimonial strategy.
Assurance-vie
French life insurance contracts (assurance-vie) follow a separate fiscal regime, distinct from the inheritance tax framework. The treatment depends on the age of the subscriber at the time premiums were paid :
- Premiums paid before age 70 (Article 990 I CGI). Each beneficiary benefits from an allowance of €152,500. Beyond this allowance, the death capital is taxed at 20 % up to €700,000, then at 31.25 % above.
- Premiums paid after age 70 (Article 757 B CGI). Only the premiums (not the gains) paid after age 70, in excess of €30,500 (across all beneficiaries combined), enter the taxable estate and are taxed at the standard inheritance scale. The accumulated gains and interest remain entirely exempt.
The split between pre-70 and post-70 premiums has significant tax consequences. The structuring of contracts, beneficiaries, and donation strategy should always be reviewed with a CIF, a notaire, or a tax counsel.
Spousal or PACS qualification of the partnership
The legal qualification of a partnership (marriage, PACS, or neither) has a direct effect on the inheritance tax owed by a surviving partner. The tax framework applicable is fixed by Article 796-0 bis CGI. The choice between these options has legal consequences far beyond tax, and is a personal decision that should be made with appropriate counsel.
How Omage fits in
Inheritance tax is a frequent topic in our patrimonial conversations with international buyers acquiring property in France. Our role, as a regulated Conseiller en Investissements Financiers (CIF) and mortgage broker, is to surface this dimension early, to ensure that the structure of the acquisition (ownership form, financing, life insurance positioning) is consistent with your long-term transmission objectives, and to coordinate with the notaires and tax counsels of our network so that the technical analysis is performed by the right professionals.
We do not provide inheritance tax advice in our own name. We act as a knowledgeable interlocutor on the patrimonial implications of your acquisition, and we ensure that the right experts are involved at the right moment.