Today's question:
“Alexis, I've spent my whole life building this wealth. Today, my greatest fear is that half of it will vanish in inheritance tax, or that my children will tear each other apart over a flat. What are my levers?”
This concern is the starting point of any successful estate planning. Passing on your wealth is not a mere administrative formality; it is a complex management act that requires juggling civil law, taxation and family psychology. In France, without anticipation, the transmission of wealth can prove heavily taxed (up to 45 % in the direct line and 60 % between unrelated parties).
At Balmont Conseil, I act as the architect of your transmission. As a wealth management expert, assisted by an AI-Augmented Wealth Engineer, I use innovation to model the impact of each estate transmission tool, aiming for an optimal wealth balance and a minimisation of tax costs.
An Overview of Estate Transmission Tools
There is no “miracle” tool, but rather a combination of solutions tailored to each wealth review.
Why use estate transmission tools?
The objective of an anticipated succession is threefold:
- Reduce the tax burden: Use the tax allowances that renew every 15 years.
- Protect your loved ones: Secure a living framework for the surviving spouse and avoid joint ownership between the children.
- Retain control: Transfer ownership while keeping the income or the management power.
The donation: Passing on during your lifetime
This is the most direct tool for organising your succession in advance and reducing the overall tax pressure.
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Manual and family gifts: They make it possible to pass on sums of money (up to 31,865 € every 15 years) fully exempt from tax, in addition to the standard allowances.
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The donation-partage: It freezes the value of the assets on the day of the deed, thereby avoiding recalculations at death and preventing family disputes.
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The “generation-skipping” gift: The transgenerational donation makes it possible to benefit your grandchildren directly, taking advantage of their own tax allowances.
The dismemberment of ownership: Optimisation through division
This is one of the most powerful levers in wealth management. It consists in separating the usufruct (the right of use and to income) from the bare ownership (ownership of the walls).
- The advantage: You give away the bare ownership. Gift duties are calculated solely on the value of the bare ownership (according to a scale linked to your age).
- On death, the usufruct is extinguished and the donee recovers full ownership without any additional tax.
Life Insurance: The fiscal “Swiss Army knife”
Life insurance enjoys an exceptional civil and fiscal regime. It is regarded as “outside the estate”.
- Taxation: For payments made before the age of 70, each designated beneficiary can receive up to 152,500 € without any inheritance tax.
- Flexibility: Thanks to bespoke beneficiary clauses, you can designate whomever you wish, beyond the forced heirs, within reasonable limits.
The SCI (Société Civile Immobilière)
The SCI makes it possible to pass on a property estate in the form of company shares.
- Advantages: It is easier to give away SCI shares than fragments of a building. Moreover, the value of the shares can be reduced by the company's debt, thereby lowering the taxable base for transfer duties. It also makes it possible to retain the management role (control) with very few shares.
The will and legacies
The will makes it possible to organise the distribution of the “disposable portion” (the share you may freely dispose of after the children's reserved portion).
- Universal or specific legacies: They make it possible to allocate specific assets to chosen persons. It is the indispensable tool for the protection of an unmarried partner (PACS civil partner).
Advanced strategies: Bespoke solutions for complex profiles
The Dutreil Pact for entrepreneurs
For business owners, the Dutreil Pact is a major tax optimisation opportunity.
It makes it possible to exempt 75 % of the company's value from transfer duties, subject to an undertaking to retain the shares.
The Donation between Spouses and the Préciput Clause
Within a community-property matrimonial regime, the donation between spouses (or gift “to the last survivor”) increases the rights of the survivor.
The préciput clause, inserted into the marriage contract, allows the survivor to take certain assets (often the main residence) before any division, without paying duties.
The Retirement Savings Plan (PER)
Little known as a transmission tool, the PER makes it possible, in the event of death before the age of 70, to pass on capital using the life-insurance allowances (Art. 990 I), while having benefited from a tax deduction on entry.
A comparison of the main transmission tools
Here is a comparative table of the main estate transmission tools.
How to prepare your estate transmission?
The Balmont Conseil Fit: Engineering in the service of people
Why entrust your transmission to Balmont Conseil? Because we are not mere intermediaries; we are designers of high-precision wealth strategies.
Why entrust your transmission to Balmont Conseil?
Because we are not mere intermediaries; we are designers of high-precision wealth strategies.
- Recognised expertise: Our firm masters the most sophisticated structures (Dutreil, cross-dismemberment, dismembered beneficiary clauses).
- AI-Augmented Wealth Engineering: We use AI to simulate the evolution of your wealth over 20 or 30 years, factoring in the probable inheritance tax under different scenarios.
- A neutral and educational approach: Our role is to present all the options to you, with their advantages and limits, without any bias towards a financial product.
- The coordination of experts: We act as the conductor between your notary, your tax lawyer and yourself to guarantee the minimisation of tax costs.
FAQ: Your questions on transmission
Anticipate in order to protect better
Estate transmission is the final management act of your life. Poorly prepared, it can become a source of tension and a financial haemorrhage. Well orchestrated, it becomes an act of benevolence that perpetuates your legacy and protects those you love.
Do not let chance, or the tax authorities, decide your succession.
Alexis Sagnier
With over 17 years of expertise in financial engineering, Alexis Sagnier supports company directors and expatriates in securing their cross-border matters.
Sources & References:
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CGI – transfer duties (art. 757, 777, 990 I)
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BOFiP ENR-DMTG
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Civil Code (art. 720 et seq., 815 joint ownership)
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Dutreil Pact (art. 787 B)