"This year has been an important one politically for France, with the Presidential and Legislative elections," says Alan Lambert, Head of Language and Law at VEF. "As ever, there have been a number of changes to French inheritance tax and property laws.

"The tax reforms are wide in their scope, but contain changes to the inheritance tax nil rate bands. Spouses will now be exempt from inheritance tax, as will signatories of PACS agreements. Also, children, parents, siblings, nieces and nephews will all see their tax-free bands increased. The shared inheritance tax free band implanted in January 2005 is, however, removed."

The 1st January this year saw the implementation of important reforms which substantially modified French inheritance tax rules. Parents are no longer considered to be a 'protected' heir, which provides greater freedom to dispose of a property in the absence of children who are still protected heirs and entitled to a minimum share. The inheritance law reform does, however, allow children to sign a deed to renounce their right to legally challenge an attempt by their parents to deprive them of their protected share.

"The available protection for the surviving spouse is growing, and the French inheritance tax rules have been reformed to provide more freedom to dispose of the property," surmises Lambert - not that this will benefit Sarkozy himself if he does indeed get divorced.

In the case of divorce, Lambert explains that "the spouse would no longer have rights to one quarter or the life interest in the French property, and would also lose their inheritance tax exemption. Also, any inheritance they did still receive (if the divorced spouse chose to will an available share of the property to them) would be taxed at 60 per cent - with a mere 1,500-euro tax-free band".

However, the French inheritance tax reforms are good news for the numbers of British buyers interested in buying property in France, who have, says Anthony Fernandes, Director of SPC Overseas, "increased as they take advantage of a sluggish market.

"France, as a major European economy has been through a torrid time in recent years. However, with Sarkozy promising growth and Paris in particularly starting to attract strong foreign investment, the tides are surely changing. With 'La Rupture' - as Sarkozy's property market galvanisation has been termed - now in sight, UK investors could see considerable gains over the next five years as France gets into the fast lane."

For those interested in buying French property and taking advantage of these inheritance tax reforms, SPC Overseas is currently marketing Les Marines Du Val (pictured) in Pleneuf Val Andre, a seaside resort in Brittany originally built by 5th Century fugitives from Britain. Due for completion in 2009, the gated development will include one- and two-bedroom apartments, each offering a terrace, balcony and secure parking; prices will start from £75,973.

Also on the market are properties within the Les Granges des Sept Laux development overlooking the Gresivaudan Valley. All properties within the development, which consist studio, one-bedroom and two-bedroom apartments, benefit from views across the likes of the Chartreuse, Vercors and Bouges mountains and will have access to amenities such as a salon, sauna, Turkish bath and a residence lounge with wireless internet connection. Properties within the development start from £80,070 / €115 113 and investors will have the option to let out their properties through the UK-based management company Mountain Heaven.

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Further articles about buying French property:
Mon dieu! La Creuse is a hot property
TGV extension to benefit Brittany property  
Paris property market top for investment  

For further information about this article visit:
SPC Overseas
Maison Individuelle
VEF

Article first published 15th October 2007