Exemption from payment of duties following a gift of money

You may be exempt from payment of duties in the following cases:

Exemption of certain family gifts of money

These arrangements are set out in Article 790 G of the General Tax Code

Conditions

Exemption is subject to compliance with the following requirements:

• On the date of the transfer the donor must be less than 80 years old

• The beneficiary must be of legal age, i.e. be at least 18 years old, on the transfer date (or have been subject to enfranchisement)

Gifts of money must have been made in full ownership:

• to children, grandchildren or great-grandchildren

• or in the absence of descendants, to nephews and nieces

• or in the event of the death of the nephews and nieces, by “representation” to great nephews and great nieces

Amount of exemptions

Exemption is granted in the commensurate amount of €31,865 every fifteen years.

These gifts can be made by cheque, wire transfer, money order or in cash.

As a result, each child may receive up to €31,865, exempt from duty, from each of his parents, grandparents and great-grandparents.

Example:  A child may receive €63,730 (31,865 x 2) from his parents and €127,460 (31,865 x 4) from his four grandparents every 15 years without having to pay gift duty.

The exemption is limited to €31,865 paid on one or several occasions during a 15-year period by the same donor to the same beneficiary.

NB : This exemption may be combined with the personal allowances granted on the basis of the relationship.

Declaration

The declaration of a family gift of money is formally recorded by filing two copies of form no. 2735, with the registration division in the location of the donee's residence within a month of the gift being made.

Important: This condition applies strictly; if you do not file the form before the deadline, you lose entitlement to the exemption

Example:

A 65-year old father gives €80,000 for the first time to his child who is over the age of majority.

As a family gift of money, €31,865 of the amount is exempt.

The balance of €48,135 is subject to the personal allowance of €100,000 for a child.

As a result, there is no duty to pay on the entire amount of €80,000.

Box V of form no. 2735 must be used to declare the whole gift:

• Second line: the amount of the exempted family gift of money for €31,865

• Then the first line: the balance, i.e. €48,135

Please note: The extraordinary gift (don "Sarkozy") granted between 1 June 2004 and 31 December 2005 (form no. 2730) and the family gift of money are two separate schemes. When a family gift of money is made between the same donor and the same beneficiary, amounts given as part of a don "Sarkozy" are never taken into account.

Exemptions related to the personal circumstances of the beneficiary

These arrangements are set out in Article 796 bis of the General Tax Code.

This exemption applies unlimitedly to the amount of gifts of money made in full ownership by cheque, wire transfer, money order or in cash.
The gift must be made during the twelve months following the act of terrorism, death or injury when the victim is not dead.

Exemption for gifts made to victims of terrorism or certain of their relatives

The exemption applies to gifts made:

• to victims of acts of terrorism committed on French soil

• and to French nationals having their usual residence in France or usually living outside France and properly registered with the consular authorities, who are victims of an act of terrorism abroad

These victims are those recognised as such by the Guarantee Fund for Victims of Terrorist and Other Criminal Acts (FGTI) as defined in Article L.422-1 of the Insurance Code.

The exemption applies under the same conditions to gifts made to the spouses, PACS (civil union) partners, common-law spouses, descendants, relatives in the ascending line and the dependants of deceased persons.

Exemption for gifts to servicepersons, firefighters, gendarmes, police and customs officers who are injured or killed in the line of duty

The exemption applies to cash gifts made:

• to servicepersons belonging to French and allied armies, who are injured whilst fighting for France during wartime

• to servicepersons injured whilst taking part in an external operation or a homeland security operation as referred to in the second paragraph of Article L.4138-3-1 of the Defence Code

• to professional or voluntary firefighters injured during a rescue mission

• to gendarmes, police and customs officers who are injured in the line of duty

The exemption applies under the same conditions to gifts made to the spouses, PACS (civil union) partners, common-law spouses, descendants, relatives in the ascending line and the dependants of deceased persons.

Temporary exemptions for gifts of building land

These arrangements are set out in Article 790 H of the General Tax Code.

Conditions

Under certain conditions, gifts of building land made between 1 January and 31 December 2015 are exempt from gift duties.

The donee (or his assigns) must:

• commit to developing and completing new accommodation units within four years of the date of the instrument

• provide proof of the development and completion of accommodation units at the end of the four-year period

Amount of exemptions

The amount of exemptions is dictated by the relationship between the donor and donee.
Within the limit of the declared value of the gifted property, it is set at:

• €100,000 for gifts made to a descendant or relative in the ascending line, a spouse or PACS (civil union) partner

• €45,000 for gifts made to a brother or sister

• €35,000 for gifts made to any other person

The exemption for gifts of building land is capped at €100,000 per donor irrespective of the number of donees.

Temporary exemptions for gifts of new buildings

These arrangements are set out in Article 790 I of the General Tax Code.

Conditions

Gifts of new accommodation buildings may be entitled to the exemption under the following conditions:

• The building permit must have been issued between 1 September 2014 and 31 December 2016

• The notarised instrument recording the gift must be executed within three years of the issuing of the building permit

• This instrument must be accompanied by the declaration of completion and compliance of the works as stipulated in Article L.462-1 of the Town Planning Code

• The building must never have been occupied or used for any purpose whatsoever when the gift is made

Amount of exemptions

The amount of exemptions is dictated by the relationship between the donor and donee.
Within the limit of the declared value of the gifted property, it is set at:

• €100,000 for gifts made to a descendant or relative in the ascending line, a spouse or PACS (civil union) partner

• €45,000 for gifts made to a brother or sister

• €35,000 for gifts made to any other person

The exemption for gifts of new accommodation buildings is capped at €100,000 per donor irrespective of the number of donees.

Exemptions based on the type of gifted property

The table below presents a list of property entitled to a special exemption

Property and rights	Exemption rate
Woods and forests, amounts deposited on a forest investment and insurance (CIFA) account and shares in forestry land group ventures	75%
Farm properties given on long-term leases	75% or 50%
Shares in agricultural land group ventures (GFA)	75% or 50%
Shares in rural land group ventures (GFR)	75%
Undeveloped land included in certain natural areas	75%
Buildings classified or registered on the supplementary inventory of the historic buildings register and owned by an individual or a property holding company (SCI)	100%
Works of art, books and collectibles given to the government	100%
First transfer, free-of-charge, of a new construction acquired between 1 June 1993 and 31 December 1994	100%
First transfer, free-of-charge, of a new building acquired between 1 August and 31 December 1995	100%
First transfer, free-of-charge, of existing building stock acquired between 1 August and 31 December 1996 and rented out	75%
Property and property rights located in Corsica until 31 December 2017	50%
Property and property rights, concerning the first transfer following the reconstitution of related property titles recorded in a properly registered instrument between 1 October 2014 and 31 December 2017	30%
The transfer of a company as part of a collective retention undertaking	75%

The conditions for these exemptions can be consulted in the useful documents section under "exempted gifts".  

Updated DINR ENR