Who receives which share of an estate is explained in our article Inheritance in France. This one covers the second question: what does inheriting cost in tax, and how can an estate with French property be planned sensibly?
Where is inheritance tax due?
Germany and France have a double taxation treaty on inheritance and gifts (since 2009). The basic rules:
- Property in France can always be taxed by France, even if the deceased and heirs live in Germany
- If the deceased or heir lives in Germany, Germany also taxes the inheritance but credits the French tax. In effect you pay roughly the higher of the two taxes
- If the deceased lived in France, France generally taxes worldwide assets
Rules for other countries depend on their treaties with France (the UK, for example, has an older treaty with France) – get individual advice.
French inheritance tax at a glance
Allowances (per heir):
- Spouse and PACS partner: fully exempt
- Children: €100,000 per child and per parent
- Grandchildren: €1,594 if their parents are still alive; for gifts there is a separate allowance of €31,865
- Siblings: €15,932 (exempt under certain conditions)
- Nieces and nephews: €7,967
- Everyone else, including unmarried partners: €1,594
Tax rates: for children, progressive from 5 to 45%; up to just over €550,000 above the allowance the rate is at most 20%. Siblings pay 35 or 45%, nieces and nephews 55%, unrelated persons 60%. For unmarried couples in particular, that is a strong argument for marriage, PACS or another arrangement.
For comparison, Germany: spouse €500,000 allowance, children €400,000, grandchildren €200,000. If you live in Germany you benefit from the German allowances, but French tax on the property is still due.
Option 1: lifetime gifts
- French allowances also apply to gifts and renew every 15 years – giving early lets you use them several times
- Particularly popular: the gift of bare ownership with reserved usufruct (donation de la nue-propriété). The children receive ownership, the parents keep the lifelong right of use. Only the value of the bare ownership is taxed, and it is lower the younger the parents are (e.g. 50% of the value for donors aged 51 to 60, 60% for 61 to 70). On death, full ownership passes to the children tax-free
Option 2: French life insurance (assurance-vie)
Assurance-vie is the French people's most important estate-planning tool. It falls outside the estate and is taxed favourably: for premiums paid before age 70, €152,500 per beneficiary is tax-free, regardless of relationship – ideal for partners, stepchildren or friends. A lower allowance applies to premiums paid after 70. Whether a French policy suits you also depends on your tax situation in your home country.
Option 3: protecting your spouse
Because joint wills don't work in France, there are French alternatives:
- Donation au dernier vivant, a gift to the surviving spouse made before a notaire: it widens the spouse's options, up to usufruct of the entire estate, even where there are children from other relationships. Costs only a few hundred euros
- Changing the matrimonial regime, e.g. to universal community with full attribution to the survivor (communauté universelle avec attribution intégrale): on the first death everything passes to the partner, and the children only inherit after the second. Check carefully, especially with children from earlier relationships
- Purchase clauses: unmarried couples buying together can agree a tontine (clause d'accroissement): the survivor retroactively becomes sole owner. For tax purposes, however, it is treated like an inheritance – for unmarried partners at 60%. The only exception is a shared main residence worth up to €76,000
Option 4: buying through an SCI
If the property is held through a property company (SCI), you pass on company shares rather than property. This makes it easier to gift shares gradually, regulate succession through the articles of association and manage the property among several heirs. An SCI also brings costs and tax consequences, though. More in The SCI at a glance.
Our advice
- Plan succession before you buy – the form of ownership (alone, jointly, SCI, tontine) is costly to change later
- Seek advice from a notaire or lawyer who knows both legal systems, and involve your tax adviser at home
- Review existing wills: a joint will should be supplemented by separate wills and French arrangements
We are happy to put you in touch with notaires and lawyers from our network.
All information without guarantee, as of November 2026. It does not replace advice from a notaire, lawyer or tax adviser. We are happy to put you in touch with German- and English-speaking experts in France.
