When going through a breakup or divorce, there are many legal intricacies that couples are, for the most part, unaware of. Me Chloé Belloy, family law lawyer, explains to us that a particular tax, obligatorily owed to the State, can act as a financial blow.
A couple breaking up is always a challenge. Besides the purely relational aspect, which can obviously be a source of conflicts, it is the entire administrative or legal part which is added to an already complicated situation. And the problem is that most of us don’t know the subtleties that apply… so when the breakup comes, it’s a cold shower. This is what Maître Chloé Belloy, a lawyer specializing in family law, explains to us: “Nobody finds out about this kind of thing in advance. People procrastinate, but unfortunately, it’s often too late by the time you find out.”
Indeed, whether during a separation between cohabitees, between civil partnership partners or a divorce between spouses, couples can quickly have unpleasant surprises, particularly at the financial level. Because calculating what belongs to each person, tracing all the costs invested during the relationship, dividing furniture or sharing real estate can be laborious. “Even when everything is going well and the ex-spouses agree on everything”there is often an element that no one anticipated: the hidden cost. If we obviously know the lawyer fees or notary fees, there is an unavoidable tax including “no one speaks” and which can act as a real sledgehammer.
“What people don’t know is that you pay a sharing fee to the State which is 1.1 % of all you have in net assets”alerts Me Belloy. This right of sharing, provided for by article 746 of the General Tax Code, concerns married couples (irrespective of their marital regime) as well as civil partnerships or common-law couples. Depending on the value of one’s assets, this tax can therefore rise to several tens of thousands of euros… and delay the separation procedure if one does not have the means to pay it. This is precisely the case for a couple of the lawyer’s clients: “They have 80,000 euros of sharing rights to pay, except that they don’t have this money. And as long as they don’t have this cash, they can’t sign the divorce document, even though they agree on everything.”
This couple had no idea of the existence of the famous right of sharing, and therefore only discovered it when starting the procedure. “My client said to me: ‘But, is this a joke? You’re talking about notary fees, right?’ Unfortunately no, it’s more for the State”Chloé Belloy tells us. In fact, this tax is therefore added to the notary fees, the lawyer fees and all the additional expenses that a separation entails. And even outside the couple, the right of sharing can also intervene in the context of an inheritance: “In inheritances which take a long time to be settled, people remain in joint ownership because they reach partial agreements, etc. And afterwards, in addition to inheritance taxes, they may still have a sharing right to settle.” In this case, the fees to be paid amount to 2.5% of the shared net value.
The only way to avoid this tax is to sell and divide the assets amicably before the separation, without going through a notarial deed. But in reality, it is rare for couples to apply this solution… especially when they are not aware of the existence of the tax. And besides, be careful: a verbal division that has not been declared in the divorce agreement can be considered an abuse of tax law, and result in penalties.
The only exception, in which the right of sharing does not apply, is the case where one of the spouses is the sole owner of a property, which they financed with their own funds (in a regime of separation of property, for example, or if the property was received as an inheritance because it does not fall within the framework of the community). It’s all these little legal subtleties that can complicate an already difficult breakup or bereavement, when you haven’t anticipated them.
