05 45 31 01 61 accueil@bh-assurances.fr

In this issue:

♦ Isabelle Want ‘s article of the Month

♦ Product of the Month

♦ Covid 19 Information & Agenda for August

♦ This month’s recipe & Living in France

♦ What happened in France in August & Agency news

♦ Professional of the Month

♦ Some French vocabulary

♦ Useful information and contact details

ARTICLES OF THE MONTH

INHERITANCE LAW IN FRANCE

Seems to me that this is the most talked about subject amongst Expats! Unfortunately, this is why you will hear or have heard so many different stories that would have been distorted under Chinese whisper tradition so unless you hear from a professional, don’t trust it!!
As we say in France: “A happy family is a family that hasn’t inherited yet” so make sure you deal with it while you are still alive!!
Although there has been a change of law, which enables you to choose British rule on inheritance, it’s not all plane sailing as French taxes still apply so let’s have a look at its implication and solutions.
First, I will explain the French inheritance law, its particularities and taxes, then, I will give you all the solutions! So, don’t panic as you read this, they are lots of solutions and do remember that French people have lived with this law since Napoleon!! And yes, we survived!
Please note that these explanations are plain and do not take into account what you have already done with your notaire. So, this is what happens if you have done nothing.

1. Assets involved:

If you are a French resident (more than 6 months per year in France), then you are subject to the French inheritance law for all your assets in France and all your movable assets worldwide! That means that your savings in the UK are subject to French inheritance law as they are movable, but if you have a property in the UK, it will be subject to UK inheritance law (if people who inherit are not French residents).
If you have a holiday house in France (meaning you are not French resident), then only your house in France will come under French inheritance law and your bank account in France will be subject to UK law.
In France, your estate is comprised of assets minus your debt. It is the job of the notaire to ascertain your estate and who are your heirs. It is possible to inherit debts!!

2. Marital status:

A Marriage regime (regime matrimonial) is a bit like a marriage contract and there are 5 different ones in France. Under European law British nationals are under the regime called “Separation de biens” meaning Asset splitting. That basically means that whatever is in your name is yours and will stay yours after the death of your spouse. That is why it is important to have money accounts in both names (mr OU mme) or one each with about the same amount on each (as the one of the deceased will be blocked).

3. No Children:

You can leave your estate to whoever you want. Must be individuals or charities (no pets!). The only problems you will have is in regard to the taxes (see last chapter).

4. Children:

You have children. Under French law, they are entitled to a minimum percentage of your estate. We call this percentage the “part reservataire”: the reserved part. This % depends on how many children you have. They have priority over your spouse! For example, you have assets worth 100 000€, and 2 children, then they have to inherit at least 66 666€ (33 333 each). If you do nothing, children automatically have ¾ of your assets.

Children Minimum %

1

50%
2 33%
3+ 25%

 

5. Spouse:

If you haven’t done anything and have children, your spouse is only entitled to a 1/4 of your estate. If you only get married once and the children are from this marriage, then the spouse has the choice between ¼ of your estate or the totality of your estate in Usufruit (see chapter 7). If you have children from previous marriage, this usufruit option is not available automatically (see solutions below)

6. Orders of Heirs:

If you do nothing (a will for example), then French law will determine who inherits your assets. There is an order of priority:
– Children
– Parents (if your parents are still alive, they can inherit ¼ each)
– Spouse (see above)
– Brothers/ sisters
– Nephew/nieces
– Uncle/aunts
– Cousins
– State
As an example, if you are single with no children, your parents are dead, then your siblings inherit. If your siblings are dead, then your nephew and nieces inherit. If they are dead, the cousins, if no cousins, then great cousins, etc….. It is the job of the notaire to find an heir. It is only when they can’t find anybody that the state inherits.
Note that partners are not recognized by law and therefore do not inherit anything from each other. In France, you need to be married or PACS (civil agreement).

7. Usufruit:

Understanding the term of usufruit(use of fruit) and nue-proprieté(naked property) is not easy! Imagine an apple tree and if you inherit the usufruit, it means that you inherited the apples. If you have the nue-proprieté, it means you have inherited the tree without any apples! In the case of a house: you purchase this house 50/50, you die, then your spouse (first marriage and children from this marriage) can chose between ¼ of your 50% of the house or the totality of your 50% in usufruit. It means your children inherit your 50% but cannot do anything with it therefore your spouse has the total use of it. Where it gets complicated is when you wish to sell as you need the agreement of a majority of the children (not all of them anymore). Usually they say yes as it means they will get a % on the sale of that property. This % is calculated with the age of the usufruit person. As the apples get older, the value of the apple diminishes!!

So, if you are selling the house after you inherited the usufruit of the half of the deceased, you only get the % according to your age. Imagine the house is worth 200 000€, you are 75, then you keep 130 000€ on the sale and your children 70000 between themselves. 100 000 for your half and 30 000 for the usufruit as you are between 71 and 81. If the usufruit person does not sell the house before she or he dies, then, automatically the apples rejoin the tree meaning your children already inherited half the house and will then be fully owners of this half (they don’t pay tax on inheriting the usufruit).

Age Value of usufruit Value of nue propriete
51-61 50% 50%
61-71 40% 60%
71-81 30% 70%
81-91 20% 80%
91+ 10% 90%

 

8. Taxes:

you thought all the above was bad; well here comes the worst bit!! And please note that the changes that have applied in 2015 did NOT change this. In the UK, the allowance is for your total assets, here in France, the allowance is for the person that inherits and the amount is depending on their relationship to you. Good news is: No death duties between spouse, Pacs partners or French registered charities.
Sad news is: 60% tax between partners (not married or Pacs). So, if you have bought a house on Tontine and are not married or Pacs, the survivor of the two will have to pay 60% tax on the half of the house he or her will inherit!
Please also note that those allowances are per person so if you buy a house 50/50 (without Tontine), then the children have 100000 each on the first death and then another 100000 each on the second death.
Example 1: a couple in their mid 70’s have 500 000€ of assets and 2 children. On the first death, the survivor chose the usufruit so the children inherit 87500 each (70% of 250000) so no tax, on the second death the children inherit 125 000 each so less than 5 000€ tax each (between 0 and 15 000, only between 5 and 15% tax).
Example 2: The same couple but with one child each from a previous marriage. On the first death, the survivor gets ¼ on 250 000 (62 500) and the child of the deceased ¾ so 187 500 so about 17 500 tax. On the second death, the other child inherit 312 500 (250 000+62 500) so 42 500 tax.

Allowance Tax/death duties
Children/parents 100000 5 to 20% (mostly 20)
Brothers/sisters 15932 35 to 45%
Nephew/nieces 7967 55%
Others 1594 60%

 

SOLUTIONS

Well done, you are still reading this and did not suffer a nervous breakdown while waiting for all the lovely solutions!

1. Testament/Will:
Making a will in France is easy, it needs 3 conditions: be handwritten, dated and signed! So, you can do it yourself (in French is best). If you have no children there are no restrictions to who you want to name on your will but be careful with the taxes (chapter 8 above. If you have children, you need to respect the share available and reserve part (see chapter 4) or do a will stating you want UK law to prevail (see chapter 7 below). A will cost around 90 euro to be registered with a notaire.

2. Tontine:
This is usually the most popular solutions used by expatriates but must be installed when you purchase the property but it only protects the property. It is a very weird clause that is included in your deeds of the house (called clause d’accroisement in the deeds). This clause says that the first one that dies was never in the deeds before; therefore, the survivor is the sole owner of the property. It is a good solution for protecting your spouse from the children.
Be careful if you have children from a previous marriage as this option will disinherit the children of the one who dies first. If the survivor wishes to live something to those children on the second death, those will be taxed 60% as they are not the children of the survivor but the children of the first deceased.
And do be careful with the tax as this solution makes it that the children only inherit on the second death and therefore only have one allowance of 100 000€ (one parent).

3. Change marital status:
You can change your marital status (chapter 2 above) to a “regime Universel avec clause d’attribution integrale”. It is like a tontine but for all your assets not just the house. It would mean that whatever belongs to you belongs to your spouse so on the first death, the spouse is the sole owner. It is not recommended when you have children from previous marriage (as you would disinherit the children of the first deceased) or if you have assets worth more than 100 000 per child (as they would have to pay 20% on what is above this allowance).

4. Donation dernier vivant/Donation entre époux:
This is a MUST if you have children from previous marriage. As I explained above (chapter 5), only couples with children from the same marriage have the option of usufruit. So, you can sign this contract (a bit like a will) which gives the option of usufruit on half of the assets belonging to the deceased to the survivor. It actually gives 3 different options to the survivor:
-¼ in full property and ¾ in usufruit
– The share available in full ownership
-The totality in usufruit
It has to be done by a notaire and cost around 175€. It has to be done for the one that has children from a previous marriage. If you both have children from previous marriage, then it will be 350€.

5. Donation:
A good way to avoid the tax/death duties is to donate your assets to your children as you are still alive. You can give as much as the allowance (100 000 per child) every 15 years and once you have made the donation you can’t die for 15 years!!! You can give the Nue propriete to your children and keep the usufruit which enables you to give more as the value of the nue propriete is a % of the value of the assets you donate.

6. Assurance Vie:
This is the most popular solution amongst French people to avoid tax and protect your spouse in regard to the savings. This is a normal investment composed of secure earnings (around 2.5%), shares or bonds but it has the particularity of being able to name beneficiaries of your choice. For the money you invest before you are 70 years old, the allowance is 152 500€per beneficiaries (on top of the allowances given by French inheritance law) and the beneficiaries will only pay 20% tax on what is above 152 500. Otherwise the allowance is only 30 500€ for all the money you put in after you are 70 years old and what is above is added to the assets inherited.
This is a huge tax saving when leaving legacies to unrelated beneficiaries such as friends or step children who would normally pay 60% tax.
They are also other advantages to this saving in regard to income tax (but that is another subject).
Obviously if you are interested in an assurance vie, contact me as it is my specialty!!

7. 17th of August 2015
Most of you must have heard that since the 17th of August 2015, you are able to choose the law of your native European country regarding inheritance law. It basically means that you will not be subject anymore to the minimum percentage you are obliged to give to your children which is the French inheritance rule.
If you don’t have any children, it does not change anything! As under French law, you can then give to whoever you want (for that, you simply need to make a will).
To be entitled to this change, you need to make a will in France stating you want to adopt your native law and must name an executor.
A French will need to be hand written, dated and signed so you could do it yourself but it only cost around 90 euro to have it registered through a notaire so why not! (and the notaire will help you write it).

Conclusion: I think I have covered most of it! Pretty complicated I know but help is at hand, advice is free with me or any notaire. I can do a study of your situation by simulating your death and calculating the tax if any and then we can see what solution is best for you.
And of course, if you are interested in opening an Assurance Vie, SEE BELOW AND CONTACT ME!

PRODUCT OF THE MONTH

ASSURANCE VIE

No, this is NOT a life insurance!! Assurance vie is a saving/ investment account!
Assurance vie saving account has been so successful that today there are over €1.5 trillion invested in Assurance vie policies. Over 22 million individuals have either invested lump sums or save regularly using this instrument.
To understand the success of this product, we need to look no further than the tax advantages that it offers. Avoiding paying tax is a number one hobby in France and the assurance vie allows you to do it legally!! So, unless you want to generously help the French government (in paying back their debt) by paying tax that French people themselves avoid paying, you should look at this properly!

General information:

It’s a saving/ investment account. The money you invest is available at any time. You name beneficiaries when you set it up. You are only taxed on interest, not capital. You can set up regular Monthly/ Quarterly or Yearly withdrawals from it. You can invest in it in one lump sum or in regular Monthly amounts or in both!).

Inheritance advantages:

Before I talk about the wonderful tax advantages, note that the main benefit of this policy is that it overrides French inheritance law! Basically, when you open an Assurance vie policy you name the beneficiary(ies). So when you eventually die, the money left on your policy is given directly to the beneficiary(ies ) without going through the notaire. For your money in the bank, the delay can be up to 6 months (time for the notaire to sort out the inheritance). In the Assurance vie, it is 2-3 weeks after reception of the necessary paperwork (death certificate, passport).

Death duties advantages:

I can hear some of you saying “2015 change of law!!” Well think again! As the changes of August 2015 will allow you to be able to choose the inheritance law of your country of birth (instead of French) BUT the tax will always be French tax so if you decide to leave some money to your nephew instead of your rightful children, your nephew will have to pay 55% after an allowance of €8 000!
The assurance vie allows you to leave money to anyone you want and as much as €152 500 per beneficiary! They are then taxed at 20% on what is above the 152 500 euro instead of the % taxed otherwise (55% for nephews, 35% for siblings).
This is the perfect solution if you want to leave something to unrelated beneficiaries such as friends or stepchildren, who would otherwise pay death duties at 60%.
But this is also a good solution for leaving money to children as they can only receive up to €100 000 each before death duties so with the Assurance vie, they can receive up to €152500 as well as the €100 000 allowance
Do bare in mind that if you are French resident, all movable assets come under French inheritance law so your savings in the UK will be subject to French inheritance tax and law.
Finally, note that it is better that all the money is put in before you are 70 years old as the tax advantage for the money invested after 70 is then €30 500 for all beneficiaries combined.

Income tax advantages:

Most French people use this product in order to prepare for their pension because once the policy has reached 8 years old, you can withdraw money with an annual tax free allowance of €4 600 if you are single or €9 200 if you are married.
This allowance is for the interest part of the withdrawal so you can take out much more per year and that means you can have regular complementary income tax free (apart from social charges)!
Example: You have opened an Assurance vie with €10 000. After 8 years, you have made €5 000 and you make a withdrawal of €3 000. The taxable amount would be: 3 000-(10 000×3 000/15 000) =€1 000. It is less than €4 600 therefore you have no tax to pay on this withdrawal. If the contract was less than 8 years old, you would have to declare this amount on your French tax return (filled in May the following year or choose the flat tax so tax taken directly from the Assurance vie). If you don’t pay tax in France, chances are you won’t pay tax on it anyway.
Note that the interest is not taxed (income tax) as long as it stays in the policy so if you don’t make any withdrawals, you are not taxed.
Social charges at 17.2% (or less if you have an S1) is taken automatically each year on the interest part of the assurance vie which is invested on Fond Euro (totally secured). For the part of your investment in shares/bonds/funds, the social charges are only taken when you make a withdrawal and only on the taxable amount.

How it is invested and what do you earn:

You can invest in Fond euro (totally secured) or in shares, bonds, funds. At whatever percentage you would like.
The fond euro which is all secured is earning around 0.7% after social charges and management fees (it is roughly the same in every company). This is because Fond euro is mainly government bonds which are around 0 now!!
The shares/Bonds/Funds depends on the market!! And I can’t see the future.
Note that the CAC40 (French equivalent to the FTSE 100) has made +70.17% in the last 5 years (as of 30/06/2021). The Euro Stoxx 50 +59.75%. Despite Covid, most of our shares have finished 2020 on a positive percentage despite the crash in March/April.
The interest on the secured part is given on the 31st of December each year.

What is wrong with it:

Well, nothing is perfect in life! So, you also need to know the disadvantages of it.
Firstly, it can cost money to set it up. There is an entry fee for opening this account and every time you add money to it (normally 4.5% of the amount you invest). But this entry fee is NEGOTIABLE (although most insurance companies and banks won’t tell you that). Yes, of course with me it is very negotiable!! The entry fee with me is very low (even 0 if a big amount) so contact me!!
Be very careful with this as some companies do not bother to tell you upfront and you will only realise once the money is invested that there was an entry fee!
There is a management fee (around 0.90%) taken yearly.
Finally, it is more like a long-term saving account, as a withdrawal can take up to 2 weeks, so this is not to be used as a treasury account.

Conclusion:

This is a brilliant product, but you need to look if it is made for you or not. I always like to look at people’s personal situation (family structure, finance, projects, etc.) to check if it is suitable for them. This appraisal is free so don’t hesitate to contact me for any further information on this subject. And note that as a broker, I use different companies which allows us to choose from a wide range of different assurance vie, some have a stop loss options to protect from market crashes, some offer a guaranteed income for pensions, some secure your gains, etc. So please contact me and I can send you details on all the type of Assurance vie we can offer.

COVID 19 INFORMATION

Remember the application called “tousanticovid” to download. When you download it, it will tell you if you have been in contact with someone else who has it, but it is also full of good advice, information like where to get a test, how many affected daily, etc and you can download the attestation to prove you have been vaccinated. Vaccination is now open to everybody above 12 years old. Go to your local pharmacie or visit the web site www.doctolib.fr to book an appointment. People over 65 years old or at risk can book an appointment for a third dose of vaccin. The PASS Sanitaire is now fully in effect. This is the proof that you have been vaccinated and you need to show it to be able to access Restaurants, bars, culture and leisure centers, hospital for visit and non-urgent treatments, retirement homes, train, buses and planes and commercial centers. As of the 30th of August, all workers in the above (restaurants, train, etc) have to be vaccinated or risk not being paid! As of 15th of September, all health workers (retirement home employees as well) have to have been vaccinated. From 30th of September, the Pass sanitaire is also obligatory for children above 12 years old. You can find details new rules on: https://www.gouvernement.fr/info-coronavirus
Important numbers:
As of 30/08/2021 there have been 114 308 deaths in France (87 692 in hospital), +98 in the last 24H. There have been 6 746 283 confirmed cases (+3 795 in the last 24H), 5 103 people being hospitalised (in the last 7 days), 851 of them in intensive care. And 48 266 656 people have been vaccinated. You can find all the information on this web site: https://www.santepubliquefrance.fr/dossiers/coronavirus-covid-19

AGENDA FOR JULY IN THE CHARENTE

4th & 5th: Forum Santé and Sport, espace Carat Angoulême. Fair where you can try different sports and check on things to improve your well being!!
4th: From 5.30pm Place de Halles in Angoulême, there will ve more than 50 very old motorbikes
5th: Motocross competition in Pranzac
5th: European Sunday from 2pm in the Parc of Fregeneuil in Angouleme. Stands with activities to discover the European Union!! Brexiters welcome !!
11th& 12th: Jam festival in St Fraigne
11th & 12th: Village Fête in La Rochette 16110 with its famous competition of Charentaise sliper throwing!!
17th , 18th & 19th: European Days of Patrimoine. Free visit of historical monuments free all over France!
18th & 19th: Potery festival in Aubeterre Sur Dronne
27th: Rouillac Monthly big fair
https://www.sortir-label-charente.net/

THIS MONTH RECIPE

Montecaos

Ingredients:
-500g of flour
-250g of sugar
-250g sunflower oil
-Cinnamon or chocolate powder

Preheat your oven at 160 °C (th.5-6).In a bowl, put the flour and sugar, then add the oil gradually mixing with your hand until you get a pastry. Take a bit of the paste in your hand and press it and and roll it inside your hand to make a very compact ping pong size. Repeat with all the pastry.Spread all the bowls on a grease proof paper and bake in the oven for 20 minutes in a 160 °C (th. 5-6) oven. The Montécaos are cooked when they crackle. Spread some Cinnamon or chocolate powder as soon as you take them out of the oven.

LIVING IN FRANCE

Le Panthéon

One of the news of this Month is the entry of Josephine Baker in the Panthéon, which gives me the opportunity to explain what is the Panthéon. It is a monument based in the 5th arondissement of Paris which was originally built as a church in the 18 century but was transformed since the revolution into a memorial for the great French personalities. There are buried people such as Andre Malraux, Jean Jaures, Pierre and Marie Curie, Voltaire, Jean-Jacques Rousseau, Victor Hugo, Louis Braille, Sadi Carnot, Émile Zola, Jean Moulin, Jean Monnet, Alexandre Dumas, Germaine Tillion, Geneviève de Gaulle-Anthonioz, Jean Zay, Pierre Brossolette, Simone Veil and Antoine Veil, and Maurice Genevoix. So, Josephine Baker will enter there in November this year with a great ceremony! Note that her body will not be moved there. Only her name will be honoured and placed there. She was French-American and a famous cabaret singer-dancer-performer. Born in 1906 in St Louis (USA). She became French in 1937 by marring Jean Lion. She died in 1975. Despite being a performer, she is particularly famous for her role a as resistant and spy during the second world war (she was with the France Libre forces), using her job as a performer to obtain information from high society and officer and passing on secret messages in her song sheets and bra!! After the war, she worked for the red cross and fought actively against racism. She will be the first black female to enter the Panthéon.

AGENCY NEWS

Lansana Sako is 26 years old and is joining us as an apprentice sale person for 2 years. He is studying for a BTS in sale and marketing in Cognac. He previously was a professional Handball player and is looking to join the real life of working!! He plays for ETEC (www.etec-handall.fr) which is currently in the 2nd division of the French league and based in La Rochefoucauld.

WHAT HAPPENED IN FRANCE IN AUGUST 2021

In general, 2 People have died in a massive fire that started next to a motorway rest area North of Toulon by and burnt more than 7000 hectares (spreading over 80 km) and took more than a week to extinguished in the Massif des Maures (natural protected area) in the Var (near St Tropez). It took more than 1 200 fireman and 10 000 people had to be evacuated. The fire was started by a cigarette.

The New Caledonian elected representatives have asked for the sacking of the chef of the Gendarmerie when they found out he was previously convicted of domestic abuse!
In Crime, People have been arrested for giving out false PASS sanitaire (2 worked for Cpam and 2 in a vaccination center); They were selling them to people who did not want to get vaccinated!

A 14 years old teenager has been shot and 2 others injured (one 8 years old) in the 13e arrondissement of Marseille. The murder is drug and gang related.

In sport: France has got 33 medals in the Tokyo Olympic games. 10 gold. But what has particularly pleased French people are the medals won in Rugby (silver for women), Basket (silver for the men and bronze for women), gold in Volleyball (men) and gold in handball (men and women). Never have we been so successful in team sports before. In fact, the only team sport qualified for Tokyo that did not get a medal is mens football (we are world champions!!). Bring on Paris 2024!

PROFESSIONAL OF THE MONTH

HOME AND PROPERTY CARE

in France since 2012, husband and wife team Mary and Shane Brown offer a full home and property care service covering departments 86, 79 and 16 (within 20km radius of Voulême 86).

Mary recently left a corporate role to join her husband in the business, offering a reliable and trustworthy service, including:

• Regular or one-off cleaning.

• Gardening/weeding.

• Gite management and key holding.

• House clearance.

• Pre-sale photography.

• Painting (interior/exterior).

• House sitting.

Mary has over 30 years’ experience of working in professional roles where trust is of the essence.

CLIENT FEEDBACK
« Mary is an extremely hardworking and trustworthy person; I recommend her wholeheartedly. »
Dorothy A, Civray 86400
Further references available.
CONTACT
Facebook: https://www.facebook.com/shanebrownmaintenance
Email: shanebrownmaintenance@gmail.com
Mobile: 06 73 42 13 75
Siret: 827 515 313 00019

INSURANCE FRENCH VOCABULARY

French English
Une Franchise Excess
Un Sinistre Claim
L’Assistance Breakdown cover
Une Assurance Insurance
Un Bris de glace Windscreen cover (In France it also covers head lights and all windows)
Un Remboursement Reimbursement
Une Cotisation Premium
Une Echéance Renewal date
Une Date d’effet Contract start date
Une Résiliation Cancellation
Un Avenant Amendment
Un Devis Quote
Un Incendie Fire
Un Dégats des eaux Water damage
Un Domage electrique Electrical damages
Un Accident de voiture Car accident
Pneu Tyre
Un Chevreuil/ Sanglier Roe Deer/ Wild boar
Un Fossé Ditch
Une Clôture Fence
Un Portail Gate
Une Tempête Storm
Un Arbre Tree
La Grêle Hail
La Neige Snow
La Pluie Rain
Le Verglas Black ice
La Toiture Roof
La Maison House
Les Murs Walls
Le Portail Gate
Grange Barn
Le Contenu Content
Un Objet de valeur Valuable item
Une Carte grise Car registration paperwork
Un Permis de conduire Driving licence
Un relevé d’information No claim certificate

Contact us !

In order to discuss and meet your need as best as possible, feel free to contact us with a mail, phone call... We can also schedule a meeting in one of our four agencies... Or directly to your home !