Passing on your heritage cannot be improvised. In France, the law hides an often unknown but extremely effective mechanism for leaving more money to your children… provided you know the right timing.
In France, inheritance today represents 60% of national assets and now constitutes the main source of household wealth according to a 2023 report from the Commission on Finance, General Economy and Budgetary Control, as part of the information mission relating to wealth taxation. With this percentage so large, it is crucial not to underestimate the importance of being well organized when passing on your belongings…
To maximize what can be left to children or grandchildren, and avoid unpleasant surprises, there are simple and effective tips. Understanding these rules can turn an inheritance into a real opportunity for your descendants. Among these rules, there is one accessible to all and perfectly legal because it is enshrined in the law. This tax system is even particularly favorable to this technique which makes it possible to transmit a larger inheritance because otherwise hello taxes when the day comes and the staggering inheritance costs!
In other words, it’s a simple and legal way to preserve more of your assets for your loved ones. On the other hand, this operation involves a constraint… You must be able to carry it out at the right time, that is to say before the parent has died.
This mechanism is listed in article 784 of the General Tax Code. This article establishes the rule for tax recall of previous donations. It stipulates that each parent benefits from a significant tax advantage for transmitting their assets. He can give up to 100,000 euros to each of his children without them having to pay gift tax. And this ceiling is not limited to just once in a lifetime since a donation of 100,000 euros can be made… every 15 years!
On the other hand, if a new donation or inheritance occurs before 15 years have passed since the previous one, the State takes into account the sums already donated to calculate the rights. This is called a “tax reminder”.
Clearly, the tax advantages used during the first donation are added to the calculation of the next one. This prevents you from benefiting from the same reduction twice and guarantees that everyone respects the 15-year period provided for by law. This mechanism therefore encourages you to plan your donations carefully over time to avoid unpleasant surprises at the time of transmission.
