Franco-Swiss inheritance: taxation and double taxation on property

The end of the Franco-Swiss tax convention on inheritances

France and Switzerland were bound by a tax convention signed in 1953, which governed in particular the taxation of cross-border inheritances. This convention was denounced by France in 2013, and ceased to have effect on 1 July 2014.

Since that date, there has no longer been a specific conventional framework to avoid double taxation on inheritances between the two countries. Each State now applies its own tax rules autonomously.

This rupture has direct consequences for families with ties on both sides of the border: heirs must navigate between two tax systems without a conventional safety net. The risk of double taxation has become real and requires careful planning.

General principles of taxation: where to pay your taxes?

In the absence of a tax convention, two fundamental principles apply to determine where the Franco-Swiss inheritance will be taxed.

First principle: immovable property is taxed in the country where it is located. A house in France will be taxed in France, a flat in Switzerland will be taxed in Switzerland, regardless of the domicile of the deceased or the heirs.

Second principle: movable assets (bank accounts, investments, vehicles, furniture) are taxed in the country where the deceased had their tax domicile at the time of death.

These rules appear simple, but their application can become complex depending on the family and asset configuration. Nevertheless, they constitute the basis of any reflection on the taxation of a cross-border inheritance.

Taxation at the property's location

The principle of territoriality applies strictly to immovable property. Each country taxes immovable property located on its territory, regardless of the nationality or residence of the deceased and the heirs.

Concrete example: A deceased person domiciled in Geneva owns a house in the French Jura. Their children reside in Switzerland. The house will be subject to French transfer duties, according to the progressive scale of the French tax administration.

Another situation: A deceased person domiciled in Lyon owns a chalet in Verbier. Their heirs live in France. The chalet will be taxed in Switzerland, according to the Valais cantonal rules.

This rule applies without exception and constitutes the first element to identify when settling a cross-border inheritance.

Taxation at the deceased's domicile for movable assets

For movable assets, it is the deceased's tax domicile at the time of death that determines the country of taxation. This category encompasses all assets that are not immovable property.

Considered as movable assets are: bank and savings accounts, financial investments (shares, bonds, life insurance), vehicles, furniture and personal belongings, debts receivable and cash.

Crucial point: Tax domicile does not necessarily correspond to nationality. A French person with tax domicile in Switzerland will see their movable assets taxed in Switzerland. A Swiss person with tax domicile in France will see their movable assets taxed in France.

This distinction between tax domicile and nationality is a source of much confusion and often requires precise verification.

The risk of double taxation and how to avoid it

Without a tax convention, the risk of double taxation is real. Certain configurations can lead to paying taxes in both countries on the same assets.

France generally grants a tax credit for inheritance duties paid abroad, but this mechanism does not always completely eliminate double taxation. The credit is capped at the amount of the corresponding French tax.

Essential step: Keep all proof of payment of inheritance duties in the first country. These documents will be necessary to obtain the tax credit in the second country.

In Switzerland, the situation varies according to the cantons. Some provide for offset mechanisms, others do not. It is essential to check the applicable cantonal rules and to seek support to optimise the tax situation.

The trap of Article 750 Ter of the French General Tax Code

Article 750 Ter of the CGI constitutes a major tax trap for heirs residing in France. This text allows France to tax the entirety of an inheritance, including assets located abroad, as soon as the heir meets certain residence conditions.

Applicable rule: If you are an heir and you have been tax domiciled in France for at least 6 years during the 10 years preceding the death, France can tax your share of the inheritance on the deceased's entire worldwide estate.

This rule applies even if the deceased lived in Switzerland and had no ties with France. It is your own tax residence as an heir that triggers the global French taxation.

This mechanism frequently generates particularly heavy double taxation situations.

Who is affected by Article 750 Ter?

Several profiles are particularly exposed to the application of this article, often without being aware of it.

Cross-border workers who have returned to France: You worked in Switzerland for years, then returned to live in France. If you inherit from a parent who remained in Switzerland in the years following your return, you are affected.

Children of expatriates: Your parents live in Switzerland, but you have resided in France for several years. Upon their death, you will be taxed in France on the entirety of your share, including Swiss assets.

Heirs recently settled in France: Even after leaving France, the 6 years out of 10 rule can continue to apply for several years.

The determining criterion is tax residence, defined by the location of the permanent home, the centre of economic interests or the length of stay.

Calculating inheritance duties in a Franco-Swiss configuration

The calculation of duties differs profoundly between France and Switzerland, both in method and in the rates applied.

In France: The system is based on a progressive scale that varies according to the family relationship. Spouses and civil partners are exempt. Children benefit from an allowance of €100,000 per parent, then a scale ranging from 5% to 45%.

In Switzerland: Each canton sets its own rules. Most completely exempt spouses and direct descendants. Rates for other heirs vary considerably from one canton to another.

To explore Swiss taxation in depth, consult our complete guide on inheritance fees in Switzerland.

Practical example: inheritance of a cross-border worker

Let us take a concrete case to illustrate the complexity of a Franco-Swiss inheritance.

Situation: Mr Dupont, domiciled in Geneva, dies. He leaves two children residing in France for 8 years. His estate comprises: a flat in Geneva (value CHF 800,000), a house in Haute-Savoie (value €400,000), and Swiss bank accounts (CHF 200,000).

Taxation: The Geneva flat will be taxed according to Geneva rules (total exemption for direct descendants). The French house will be subject to French duties (after an allowance of €100,000 per child, taxation according to progressive scale). The bank accounts, movable assets of the deceased domiciled in Switzerland, will be taxed in Geneva (exemption).

Trap: The children, French tax residents for more than 6 years, will have to declare the entirety of their share in France, including Swiss assets, according to Article 750 Ter.

Swiss cantonal specificities regarding inheritance

Switzerland does not have a unified tax system: each canton legislates autonomously on inheritance matters. This diversity creates considerable differences.

Frequent exemptions: The majority of cantons completely exempt spouses and direct descendants (children, grandchildren). Some cantons also exempt registered partners and sometimes cohabitants under certain conditions.

Significant variations: For other heirs (brothers, sisters, nephews, nieces, non-relatives), rates vary from 0% to more than 50% depending on the cantons. Some cantons such as Schwyz or Obwalden do not apply any inheritance duty.

To understand the Swiss inheritance system in detail, consult our article on inheritance in Switzerland.

Tax returns: mandatory procedures

Settling a Franco-Swiss inheritance involves complying with reporting obligations in each country concerned. Deadlines and formalities differ significantly.

Heirs must precisely identify which assets fall under which tax jurisdiction, gather all supporting documents (deeds of ownership, bank statements, notarial certificates), and comply with legal deadlines under penalty of sanctions.

The administrative complexity of a cross-border inheritance should not be underestimated. It requires rigour, organisation and often the support of professionals on both sides of the border.

Each country has its own forms, its own competent authorities and its own documentary requirements. An error or omission can result in tax adjustments and surcharges.

Declaration in France

In France, the inheritance declaration is mandatory as soon as the gross assets exceed €3,000 (or €15,000 in direct line). It must be filed with the tax office of the deceased's domicile.

Main form: Form 2705 (inheritance declaration) must be completed with the detailed inventory of all assets, their value, and the distribution among heirs.

Deadlines to comply with: 6 months if the deceased resided in metropolitan France, 12 months if the deceased resided abroad (therefore in Switzerland).

Documents to attach: Death certificate, family record book, proof of ownership of assets, bank certificates, possibly certificate of inheritance or certificate of notoriety.

Failure to comply with deadlines results in late payment interest and penalties that can be significant.

Declaration in Switzerland

In Switzerland, procedures vary according to the cantons. Some require a formal declaration, others are based on the inheritance inventory established by the competent authority.

Role of the notary: In some cantons, appearing before a notary is mandatory to establish the inventory and distribute the inheritance. In others, it is the supervisory authority (guardianship authority or justice of the peace) that intervenes.

Inheritance inventory: Central document that lists all the deceased's assets and liabilities. It serves as the basis for calculating cantonal inheritance duties.

Variable deadlines: Each canton sets its own deadlines, generally between 1 and 3 months after death to declare the inheritance.

For more details on the process, consult our guide on deadlines and steps for settling an inheritance in Switzerland.

Practical advice for optimising your Franco-Swiss inheritance

Anticipation is the key to minimising the tax burden and avoiding administrative complications in a cross-border configuration.

Lifetime gift: Transferring part of your estate before death can allow you to benefit from renewable tax allowances and reduce the taxable base. Discover the advantages in our article lifetime gift or will.

Choice of tax domicile: The deceased's place of domicile has a major impact on the taxation of movable assets. This choice must be carefully considered according to the family and asset situation.

Structuring of assets: Depending on the location of assets and the residence of heirs, certain restructurings may be advantageous (sale, gift, creation of legal structures).

Specialist advice: Binational support allows you to identify tax traps and optimise the transfer.

When to consult an international tax expert?

Certain situations absolutely require the intervention of professionals specialised in cross-border inheritances.

Substantial estates: Beyond €500,000 or CHF, the tax stakes amply justify the cost of professional support.

Complex family configurations: Heirs distributed between several countries, blended families, presence of non-resident beneficiaries.

Professional assets: Companies, shares, self-employed activities require specific expertise.

Professionals to contact: Notary specialised in international law, binational tax lawyer, Swiss fiduciary with Franco-Swiss expertise, international chartered accountant.

These professionals master the subtleties of both systems and can legally and fiscally secure the transfer.

Informing your loved ones and preparing your inheritance

Beyond tax aspects, preparing a Franco-Swiss inheritance involves clear communication with your loved ones and rigorous organisation of your documents.

Essential documentation: Gather and centralise all documents relating to your assets in both countries (property titles, bank contracts, insurance policies, will).

Adapted will: Draft a will that takes into account the specificities of the inheritance law of both countries. Verify its validity in both jurisdictions.

Informing loved ones: Inform your heirs of the existence and location of your assets, as well as your wishes regarding distribution.

When the time comes, publishing an obituary on Funere allows you to quickly inform the entire circle of acquaintances and centralise useful information for the procedures to come.

Franco-Swiss inheritances present real tax complexity since the end of the 2014 convention. The rule is simple in appearance: immovable property is taxed in the country where it is located, movable assets at the deceased's domicile. But Article 750 Ter of the French General Tax Code can create double taxation for heirs residing in France.

Each situation is unique. Swiss cantonal specificities, the amounts involved and the composition of the estate directly influence the final tax burden. Advance planning helps avoid costly mistakes and protect your loved ones.

Faced with these challenges, consulting an international tax expert remains the best investment. At the same time, informing your family of your arrangements and centralising your documents will greatly facilitate the procedures. If you need to publish an obituary following a cross-border inheritance, Funere supports you with transparency and respect, for only CHF 180.