Is tax due on a gift in a UK will to French family?
Your principal country of residence is relevant when determining any tax due
There are other routes to consider if gifting to a French resident
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Reader Question: What inheritance tax, if any, would be payable if I leave some money in an English will to my late partner’s French nieces?
The situation here depends for a start on whether you are French or UK resident at the time you die.
If a UK resident, then as a general rule, no French inheritance tax is incurred when a French resident inherits from someone in the UK (the main exception being if French real estate is passed on).
If you are a French resident, then first of all your partners’ nieces would, unfortunately, not be considered equivalent to your own nephews and nieces. Under tax law, France only considers the children of your own brothers and sisters as such. So in your case they would essentially be seen as unrelated to you.
Read more: Succession planning in France can highlight cultural differences
This means that French inheritance tax would be payable on any financial gift you left to one of them, at 60% after an allowance of €1,594.
This cannot be avoided easily by, for example, making large lifetime gifts as such gifts should be declarable by the recipient for French gift tax, which is no better.
One option you could look into is setting up an assurance vie, making them the beneficiary, which is likely to be more beneficial although the exact rules on taxation vary, notably depending on your age when you take it out.
Read more: What is the ‘assurance vie’ our French bank is offering us?
