Buying French Property with a Tontine Clause

What is A Tontine Clause

Here's some inheritance related information about buying property and real estate en tontine or with a tontine pact, but first, just what is a tontine clause?

The tontine clause (also called 'tontine pacte') may be an option to consider if you are buying a real estate property as a couple. It avoids the risks of undivided ownership and guarantees ownership of the entire property to the survivor.

How Does a Tontine Work?
This applies to the house only and forms part of the purchase contract, it applies to married and unmarried couples, partners or friends. With this clause you buy together but no one knows who the owner is until one of the parties has passed away, and is considered to have been the survivor’s property since the date of purchase. The remaining owner may do what they wish with the property, including selling it if they don't want to keep it.

Is A Tontine Suitable for Me?
But the tontine may not be suitable for your personal circumstance and can at times turn into a trap as during the lifetime of the buyers, unanimity must be sought to do or change anything. If the buyers no longer get along, the tontine must be cancelled to allow the purchase of the property by one of the parties.

Unanimity is required to sell, because in the case of the tontine (or accretion clause), the concept of “no one may be forced to remain in a state of undivided ownership” is not applicable.

Upon the Death of One of the Owners
The predeceased person is declared never to have bought, only the surviving buyer is considered the owner from the start. The benefit, no inheritance/heirs but keep in mind that the payment of inheritance tax is due as in common law based on the total value of the property.

People who are neither married nor in a civil partnership will be taxed at 60%. No inheritance tax will be due if the property is the main residence of both people and if at the time of death, the property value is less than €76,000.

For more information on buying real estate en tontine, you must contact your notary who will be able to advise you. Take a look at our Property Buying Guide for more information about the purchase process and tell us about plans so we can help find your own property in France.

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