Usufruit to minimise IHT on French property
Usufruit to minimise IHT on French property
Author
Discussion

GR_TVR

Original Poster:

802 posts

114 months

Wednesday 20th June 2018
quotequote all
Hi,

My parents have purchased a plot of land in France, which they are going to build a house on.

In order to minimise inheritance tax on my behalf the notaire has suggested they use a system called usufruit (I think it's usufruct in English?)
As I understand it it's some sort of trust where I would have responsibility for the property but my parents would continue to own and live in it until they died.

The notaire is saying that I would not have to pay any IHT in France upon the death of my parents.
He has mentioned that there is some debate on whether this would negate any UK IHT - but I can see a couple of cases that the HMRC has lost when they've argued UK IHT is due.

Essentially, I'm just wondering if this is the best route to go down or whether there is another option I should consider?
Appreciate it's perhaps a pretty complex topic but thought I'd try my luck anyway smile

Thanks

Croutons

13,369 posts

196 months

Wednesday 20th June 2018
quotequote all
It does not "minimise" IHT. It helps directs ownership after the event.

https://www.lawgazette.co.uk/law/the-french-estate...