Inheritance gifting allows an heir to donate all or part of their inheritance to a cause without paying inheritance tax on the property or amount donated. The act of generosity therefore does not come from the deceased, as in the case of the legacy, but from his heir. The general tax code indicates that the operation must be implemented within twelve months following the death (it was six months until 2020), and specifies the eligible organizations (in particular foundations and associations recognized as being of public utility ).
“We benefit from around ten inheritance donations each year, made by direct heirs (children, grandchildren) or not”, explains Sabine de Soyres, head of the philanthropy center of the Fondation de France. The operation takes on its full meaning for heirs for whom inheritance taxes are important. They amount in particular to 55%, after a reduction of 7,967 euros for nephews and nieces.
So, a person inheriting 100,000 euros from their uncle would have to pay around 51,000 euros in inheritance tax and receive 49,000 euros. This can pose a problem if the assets are not “liquid” (if it is, for example, real estate), the nephew not necessarily having the means to pay this amount from his personal funds. He must then sell the property quickly (the deadline for paying inheritance tax is six months from the death, in the general case).
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If this nephew makes an inheritance gift of 20,000 euros, his inherited assets are reduced to 80,000 euros and his inheritance tax to just under 40,000 euros. Certainly, the nephew receives less (around 40,000 euros), but nothing illogical, a philanthropic action not intended to enrich. “In practice, we can imagine a distribution in which the nephew keeps the deceased’s liquid assets and gives the real estate to an organization,” indicates Céline Ponchel-Pouvreau, generosity director of La Ligue contre le cancer. This allows you to avoid taking on the responsibility of selling a house yourself.
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