British investors could gain from French IHT changes

Reforms to France's inheritance tax regime could see the British owners of modest properties exempted from any liability.

The French president, Nicolas Sarkozy, has proposed that the threshold for inheritance tax liability on estates be tripled.

If the reforms go ahead, only 5% of properties would be liable – freeing large numbers of British holiday home owners from the threat of a large tax bill.

Serge Cowan, managing director of Unique Living International Estate Agents, welcomed the French government's plans as likely to stimulate continued investment by British citizens in French property.

"Most buyers now know that they can invest in France without fear of having their estate taxed when they die," he said.

"This will boost interest even further in investment in France, a country much loved by the British," Mr Cowan continued.

A number of other fiscal reforms proposed by the Sarkozy administration would make property investment in France more appealing, particularly changes to the wealth tax regime.