What is 'Usufruit' in French Inheritance Law
One aspect of French law is the heavy estate and death duties that are involved in transfers. One of the methods to get out of this is what is known as 'ÂUsufruit'. One of the popular methods to obviate the payment of French inheritance tax is for
One of the cardinal principles of French inheritance law is the inviolable right of the children to the property of the parents. In England a parent and owner of an estate can dispose of his property as he deems fit by a will. He can do generally whatever he wants with the property. In France it is different and a portion of the property has to be given to the children. French inheritance laws are a protectionist law and based on the principle of general good. As such the rights of the children to the estate of their parents cannot be tampered or changed. The basic principle is that a parent cannot disinherit his children. One aspect of French law is the heavy estate and death duties that are involved in transfers. One of the methods to get out of this is what is known as Â'Usufruit'Â. One of the popular methods to obviate the payment of French inheritance tax is for the owner of the property to gift their house to their children in their life time. The owners of the property however retain the right to use the property and live in it for their entire life. This is referred to as Usufruit. Though the property is gifted to the children the parents continue to use the property. They are also entitled to any income or rent that may accrue from the property. The greatest benefit of thus Usufruit is in case the donors are younger in age. The older the parent lesser the benefit. The Usufruit lapses with the death of the parent. It must be borne in mind that Usufruit is on a sliding scale and its focal point is age of the parent, thus in case a parent is less than 50 years of age his and the children'Âs benefit is more. In case he his above 60 the benefit decreases. In French this is referred to as nue-proprit. The inheritance tax is calculated on the value of the nue proprit. No taxes are payable when the property reverts to the 'nue propritaire' on the death of the life-interest holder. French law decrees that the property or the estate is to be divided into 2 parts. One on which the children have an inalienable right and the other which can be disposed by the owner with a will as he deems fit. The Usufruit is applicable to only the portion of the property which is the children'Âs right, but as the parent has the right to dispose of the second part of the property by a will, the parent can will this part also to the children.