The advantage of an early transmission strategy is first of all to play on the level of taxation of its assets, via the combination of different legal mechanisms which make it possible to significantly reduce the tax cost of transmission.
In addition, by relinquishing their property while they are still alive, parents can pay the gift tax in place of their children, which is obviously not the case for the payment of inheritance tax. This support – which does not constitute a taxable donation supplement – allows their transmit more tax-free.
1. Donate every fifteen years
Gift and inheritance rights for the benefit of the same heir form a whole. They are calculated after deduction of a allowance of 100,000 euros for transmissions between parents and children. This abatement is renewed every fifteen years. In application of this rule, each parent can therefore give up to 100,000 euros to each of their children every fifteen years free of gift tax.
A couple with two children can thus transmit up to 400,000 euros (100,000 euros x two children x two parents) to their children in one go without their having any right to pay. If the couple renews their gesture fifteen years later, it is again 400,000 euros which will be able to definitively escape the free transfer rights, and so on.
But for parents who would like to pass on more to their children, this donation strategy, which is renewed every fifteen years, also makes it possible to benefit each time from the lowest portions of the scale of donation rights. “In other words, it is better to pay three times the gift tax calculated in the lowest brackets of the scale rather than pay all in one inheritance tax. For assets of 3 million euros, this represents a saving of rights of 428,508 euros! “ explains Arlette Darmon, notary in Paris and president of the Monassier group.
2. Give only bare ownership
The fact remains that not all parents necessarily have the intention or the means to gradually deprive themselves of the use of their property or of the income they bring them. If they want to be able to keep control of their heritage, they can to reserve the usufruct and give only bare ownership to their children.
From a fiscal point of view, this operation is very advantageous. Because the gift tax will be calculated only on the value of the bare ownership transmitted to the children which, by assumption, is lower than that of the full ownership. It depends on the age of the donor on the day of the donation. Knowing that the younger it is, the lower it is. For a donor aged 61 to 70, this value is equal to 60% of full ownership.
Clearly, this means that at the time of the donation, the duties payable will only be calculated on 60% of the value of the goods transmitted ! On the death of the donor parent, the usufruct will join full ownership, without the children having to pay additional inheritance tax, neither on the value of the usufruct, nor on the possible gain taken by the goods.
3. Sign a Dutreil pact
” For parents who have a professional heritage to pass on, the solution is to set up a Dutreil pact ”, suggests Jean-François Desbuquois, associate lawyer at Fidal, member of the Cercle des fiscalistes. It allows to reduce the taxable base, thanks to a 75% exemption on the value of the business transferred.
In other words, the rights to be paid during the transfer of the business will only be calculated on 25% of its value, knowing that in the event of inter vivos transfer, their amount may still be halved if the donation is made in full ownership before the donor’s 70 years. ” In the end, this makes it possible to divide by 10 the cost of its transmission ”, adds Jean-François Desbuquois. But that’s not all ! In the event of a shared donation requiring the child (ren) taking over the payment of a balance to their brothers and sisters, the latter may also benefit from the exemption of 75% for the sums received even though they are not not signatories of the Dutreil pact.
In the event of inheritance, the reduction of rights by half cannot be applied, but the heirs can request to benefit from a specific deferred payment system, then split inheritance tax, which is reserved for business transfers. It makes it possible to spread the payment of rights over ten years, after a deferral of five years, in return for an interest rate set at 0.4% for requests made in 2021 and valid throughout the duration of the sprawl.
Exempt family donations
Do not forget the exemptions in favor of family donations of sums of money: exemption of 31,895 euros per beneficiary, renewable every fifteen years, for donations made before the donor’s 80 years and exemption of 100,000 euros per donor for donations granted until June 30, 2021 if the sums are used to finance the construction of the donee’s main residence, to carry out energy renovation work there or to subscribe to the capital of the company he manages or in which he operates main professional.
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