The United Kingdom is changing the inheritance-tax treatment of many unused pension funds and pension death benefits. For deaths on or after 6 April 2027, the new regime will generally bring relevant pension interests into the UK inheritance-tax calculation, subject to statutory exclusions and exemptions. A British citizen who has settled in France therefore needs to examine more than the pension provider’s beneficiary form. The date of death, the pension scheme, the deceased person’s UK residence history, the family’s French tax position and the France–UK inheritance-tax convention can all affect the result.
This change is easy to confuse with ordinary income tax on a pension paid after death. They are different questions. It is also easy to assume that living in France removes UK inheritance tax, or that French tax automatically gives a full credit against a UK bill. Neither assumption is safe. French succession tax may apply under its own territorial rules, while the 1963 France–United Kingdom convention can alter the domestic result. The practical answer begins with a precise file: pension documents, residence evidence, the will, beneficiary nominations, valuations and every tax calculation.
This guide focuses on the 6 April 2027 reform and the France-facing checks that should be made now. It complements, rather than repeats, our general guide on UK pension taxation and treaty declarations in France. It is written for a British reader who needs to identify the right question, preserve evidence and challenge an incorrect assessment without treating a pension, an estate and a tax treaty as the same legal object.
I. Will a UK pension be subject to inheritance tax when its owner lives in France after 6 April 2027?
A. What exactly changes for deaths on or after 6 April 2027?
The starting point is the date of death. The UK measure was enacted in the Finance Act 2026. Its inheritance-tax provisions insert a new statutory framework into the Inheritance Tax Act 1984. The central concept is “notional pension property”: for inheritance-tax purposes, the law can treat pension-related property as part of the deceased person’s estate even where the pension would not have passed through the estate under ordinary scheme administration.
HM Revenue & Customs (HMRC) states in its technical material that “This change is effective for deaths on or after 6 April 2027.” That date is not a general implementation target that can be ignored until the provider pays the beneficiary. A death before 6 April 2027 remains governed by the existing rules, even if an administrator, executor or beneficiary deals with the payment later. A death on or after that date requires the new analysis. The first document in a disputed file should therefore be the death certificate and the precise date, not a later payment statement.
The measure is aimed at unused funds and death benefits under relevant pension arrangements. It can cover a UK registered pension scheme and certain qualifying non-UK pension schemes. The statutory treatment also deals with where the pension property is regarded as situated. That situs rule matters in a cross-border case because the United Kingdom’s charge, the French charge and the treaty allocation may use different connecting factors. A qualifying non-UK arrangement should never be labelled “outside tax” merely because the provider is not in the United Kingdom.
The reform does not mean that every payment associated with a pension is automatically taxed in the same way. The legislation and HMRC guidance identify exclusions and special categories. For example, some dependants’ scheme pensions, annuity interests and qualifying death-in-service benefits may be treated differently. The precise scheme rules, the type of benefit and the person entitled to it must be read together. A defined-contribution pot in drawdown is not analysed in the same way as a continuing dependant’s pension, and a death-in-service payment is not assumed to be an unused personal pension fund without checking the statutory conditions.
The reform also separates three questions which families often merge:
- Who receives the benefit under the pension scheme? This is affected by the nomination form, scheme rules, the administrator’s discretion and any binding entitlement.
- What income-tax treatment applies to the payment? HMRC’s guidance on tax on pension death benefits explains that the answer can depend on the type of benefit and the age of the person who died.
- Does the value enter the inheritance-tax computation? From the operative date, a discretionary nomination is not by itself a complete answer because the new legislation can bring the relevant pension property into the estate calculation.
That distinction is important for a British resident in France. A beneficiary may receive a pension directly, while the personal representatives still need information from the pension administrator to complete the UK inheritance-tax account. Conversely, a benefit can have one income-tax result in the United Kingdom and a different succession-tax or treaty result in France. The documents should record each result separately rather than describing the whole payment as “tax-free” or “part of the estate” without qualification.
Responsibility for the new process is also more structured than a family may expect. The personal representatives (the executors or administrators handling the estate) have reporting and payment responsibilities for the inheritance-tax account. The pension scheme administrator can have a role where the legislation requires tax to be withheld or paid from pension property. HMRC’s explanatory material and later information regulations are designed to make it possible for scheme administrators to provide the information needed by the personal representatives. The family should request the administrator’s written calculation, the valuation date, the scheme classification and the legal reason for including or excluding each benefit.
The published HMRC material is not a substitute for the final scheme-specific guidance. HMRC has indicated that support and detailed guidance will be updated for the new regime. That makes contemporaneous evidence particularly valuable. Save the version of the scheme rules, statements and guidance used by the administrator, together with the date on which each figure was supplied. A later change in an online explanation should not erase the evidence on which a tax return or a payment decision was based.
The new rule does not remove exemptions. Transfers to a spouse or civil partner can engage the relevant exemption, and qualifying charitable transfers can have a different outcome. But an exemption must be tested against the actual recipient, the legal status of the relationship, the pension route and the relevant UK rules. A French marriage record, a civil-partnership certificate or a beneficiary form may need to be translated and authenticated for the UK file. The existence of an exemption does not remove the need to report accurately where reporting is required.
There is a further reason to avoid a last-minute transfer made solely to escape the reform. A transfer to a qualifying overseas pension, a change from drawdown to an annuity, or a new nomination can have its own UK and French tax effects. It may alter income-tax timing, the administrator’s discretion, the location of the pension property or the family’s access to funds. Any proposed change should be modelled against the death-before-6-April-2027 and death-on-or-after-6-April-2027 scenarios. It should not be presented as a guaranteed inheritance-tax solution.
B. Why living in France does not answer either the UK or French tax question
A French address is evidence, but it is not a complete cross-border tax analysis. Since 6 April 2025, UK inheritance-tax exposure for overseas assets is framed through long-term UK residence rules rather than the old domicile and deemed-domicile language. The current HMRC guidance on long-term UK residents asks whether a person has been UK tax resident for the required period, including the ten-year tests and the possible period during which overseas assets remain within scope after departure. The person’s UK residence history must therefore be reconstructed rather than inferred from the date on a French residence permit.
For a British owner who moved to France, the file should identify the last UK tax year of residence, any later UK tax-residence years, periods of temporary return, and the statutory tail that may apply after departure. A person can be French tax resident and still fall within the UK’s long-term-resident rules. The converse is also possible: a person can live in France for part of a year without satisfying every French or UK residence test. Residence, domicile in older documents, nationality and immigration status are different concepts.
The UK pension legislation itself may use a scheme-based situs rule, while the long-term-resident rules can bring overseas assets within the UK inheritance-tax net. That is why a French-based pension cannot be classified by geography alone. The calculation should show which connecting factor is being used and for which purpose: scope of the UK tax, valuation, treaty allocation, French succession tax or civil succession administration.
France begins with its own definition of tax domicile. Article 4 B of the French General Tax Code refers, in substance, to the household or principal place of stay, the main professional activity and the centre of economic interests, subject to applicable treaty rules. A Withdrawal Agreement residence card is not, by itself, a ruling on tax domicile. A British resident should preserve French tax returns, the address of the family home, work or pension evidence, dates of arrival and departure, and any certificate of residence used in a treaty claim.
French succession tax is then tested under Article 750 ter of the General Tax Code. The current Article 750 ter begins with the words “Sont soumis aux droits de mutation à titre gratuit”, meaning that assets transferred by gift or succession can be subject to French free-transfer tax. In broad terms, the three domestic gateways are:
- where the deceased or donor is French tax domiciled, French rules can reach movable and immovable assets in France and abroad;
- where the deceased or donor is not French tax domiciled, French tax can still apply to assets regarded as situated in France; and
- where the beneficiary is French tax domiciled and has been so domiciled for at least six of the ten years before receiving the assets, the French rules can reach assets in France and abroad.
Those are domestic starting points, not the end of the analysis. The France–United Kingdom convention on inheritance taxes, signed on 21 June 1963 and published in France by Decree no. 64-789 of 27 July 1964, can allocate taxing rights and provide relief from double taxation. This convention is separate from the 2008 France–UK income-tax treaty. A family must not use an income-tax article about a recurring pension payment as if it were an inheritance-tax article about the capital value of an unused fund.
The French administrative commentary on the inheritance convention is useful for the practical sequence. The BOFiP France–United Kingdom inheritance-tax commentary explains the situs allocation and the credit mechanism. It also describes a route for requesting a reduction or refund when the convention leaves France with a lower final burden, subject to the applicable evidence and time limit. The commentary is not a reason to assume that a credit will appear automatically on a French declaration. The return, the UK tax evidence and the treaty claim must be made to fit the exact assets and the exact taxpayer.
French domestic relief can also be relevant. Article 784 A of the General Tax Code provides, in the cases it defines, that foreign succession tax may be set against French tax. The statutory text says that tax “hors de France est imputable sur l’impôt exigible en France”, meaning that tax paid outside France can be credited against the French tax due in the circumstances provided by the article. The credit is limited and asset-specific; it is not a universal refund of every UK payment. The convention must be checked first because a bilateral allocation can override or refine the domestic result.
The civil law of the succession must also be kept separate from the tax rules. Article 720 of the French Civil Code states, “Les successions s’ouvrent par la mort, au dernier domicile du défunt”, which means that the succession opens at death, at the deceased person’s last domicile. Article 724 of the Civil Code addresses the persons who acquire the succession rights by operation of law. These provisions help explain why a French notary may need to identify heirs and assets even when the pension administrator pays outside the notary’s account. They do not, on their own, decide whether the UK tax fiction or the French tax convention applies.
The result can therefore be different in four realistic cases. First, the deceased may be French tax domiciled and long-term UK resident, so both countries examine the pension. Secondly, the deceased may be outside the UK long-term-residence net but leave a benefit connected with a UK scheme. Thirdly, the deceased may be outside French tax domicile while a beneficiary living in France satisfies the six-out-of-ten-year French test. Fourthly, a treaty situs rule may allocate the same pension property differently from a domestic rule. A proper opinion states which case applies instead of giving a single answer based on nationality.
II. What should the family do now to value, report and challenge the estate?
A. How to build the UK–France tax file before death
The best time to assemble the evidence is before a claim is urgent. A British resident in France should create a pension schedule for every arrangement, including small legacy pots. The schedule should be updated after a transfer, a change of drawdown status, a new nomination or a move between providers. The following items are particularly important:
- the scheme name, administrator, policy or member number and the governing scheme rules;
- whether the arrangement is a UK registered pension scheme, a qualifying non-UK pension scheme, a QROPS, an annuity, a drawdown account, a defined-benefit promise or another arrangement;
- the latest statement, the valuation method, the valuation date and the currency used;
- the beneficiary nomination, whether it is binding or discretionary, the date it was made and any confirmation from the administrator;
- the identity and status of any spouse, civil partner, dependant or charity named in the scheme documents;
- any death-in-service policy or employer benefit kept separate from the personal pension; and
- the provider’s explanation of which benefits it believes will be excluded or included from 6 April 2027.
Do not wait for a provider to use the phrase “estate value”. Ask for the value needed for the new UK inheritance-tax account and for a separate statement of any income-tax charge. If the provider refuses to give a pre-death projection, retain its refusal and ask what information the personal representatives will receive after death. A nomination form is evidence of intended payment; it is not a complete tax opinion.
The residence file should cover both countries. On the UK side, collect P60s, self-assessment returns, HMRC residence correspondence, employment or business records, dates of departure and return, and evidence of whether a long-term UK-residence period remains active. On the French side, collect income-tax notices, declarations, the first and last French tax-residence dates, proof of the household’s principal life and any treaty-residence certificate. If the family has moved between France, England, Scotland, Wales or Northern Ireland, record the dates and the legal connection in each period. The tax question is about the relevant statutory tests, not a general impression that “we have lived in France for years”.
The civil file should include the current will, earlier wills, codicils, marriage or civil-partnership records, divorce orders, children’s birth certificates and any document naming a dependant. A French acte de notoriété is a notarial certificate identifying persons entitled to inherit; it may be needed after death, but it should not be confused with the will or with a tax clearance certificate. Keep English originals and certified French translations where a provider, notary or tax authority asks for them.
Choice of law and reserved-heir issues also deserve a separate review. Article 913 of the French Civil Code defines the protected share for certain descendants and the available portion. It does not mean that every British family living in France is automatically governed by every French reserved-share rule; the applicable succession law, any valid choice of law and the scope of the relevant European succession rules must be established first. After Brexit, a British national should not assume that an English or Welsh will will have exactly the same effect as a French will in every asset class.
If a reserved-share dispute arises, Article 921 of the Civil Code contains time limits for an action to reduce gifts or testamentary dispositions. The limitation period is not a reason to delay: documents may be needed long before the family knows whether the pension is treated as a benefit outside the estate, a notional pension property or an asset relevant to the reserved-share calculation. The form of the will matters too. Article 970 of the Civil Code sets the French formal requirements for a holographic will. A foreign will can raise additional formal and choice-of-law questions.
The Court of cassation has shown why formal validity and cross-border consequences should not be collapsed into a single question. In its first civil chamber decision of 12 June 2014, no. 13-18.383, available on Légifrance, the Court dealt with the recognition of an international will where the formal requirements were at issue. The lesson for a British resident in France is practical: preserve the original, the signing circumstances, the witnesses, the translation and the evidence of the intended applicable law. A beneficiary nomination cannot silently repair an invalid will, and a valid will cannot silently answer the tax calculation.
The tax file should also identify the likely declarants. In France, Article 800 of the General Tax Code requires the heirs or legatees to file a detailed succession declaration in the cases covered by the provision. Article 802 concerns the affirmation accompanying the declaration, including the declaration of French and foreign securities. A UK pension statement should be placed alongside, not substituted for, the French succession declaration. Ask the notary or tax adviser which person will sign, which assets must be described, which exchange rate is used and how a foreign tax payment will be evidenced.
Use a simple evidence index. Number each pension statement, tax notice, residence document, will, valuation, payment receipt and authority letter. Note the date downloaded, the issuing body, the currency and whether it is an original, copy or translation. In a France–UK estate, the same balance may appear in pounds in a provider statement, euros in a French return and a different converted figure in a UK inheritance-tax account. The calculation should show the rate and date rather than silently replacing one figure with another.
Finally, make a scenario sheet. At minimum it should compare:
- a death before 6 April 2027, where the current UK pension inheritance-tax rules apply;
- a death on or after 6 April 2027, where the new notional-pension-property rules must be tested;
- payment to a spouse, civil partner, dependant, charity or another beneficiary;
- the deceased as French tax domiciled, non-resident or treaty resident; and
- a beneficiary who has or has not been French tax domiciled for six of the previous ten years.
This is not a forecast of the amount due. It is a way to identify which fact changes the legal route. If the answer changes when one residence year, one beneficiary or one scheme category changes, that fact should be verified before the family accepts a provider’s calculation.
B. How to challenge an overcharge or protect the beneficiary after death
After a death, the personal representatives should ask for a written “benefit map” from each provider. It should identify every payment, the gross value, the date of valuation, the currency, the legal basis for inclusion or exclusion, the recipient, the income-tax treatment and the information supplied to HMRC. If the provider gives only a net payment figure, ask for the gross calculation and all deductions. A beneficiary cannot assess a treaty claim from a bank credit alone.
The first review is the date rule. If death occurred before 6 April 2027, the new rule should not be applied simply because the claim was processed after that date. If death occurred on or after 6 April 2027, ask whether the benefit is within the new statutory category and whether an exclusion applies. The provider’s answer should be compared with the actual scheme rules and the wording of the Finance Act 2026. If the provider has treated a discretionary nomination as conclusive, ask it to explain how the new inheritance-tax provisions were considered.
The second review is scope in the United Kingdom. Reconstruct the deceased person’s long-term UK residence position and the status of any overseas pension. Check exemptions, the spouse or civil-partner position, charitable gifts, debts and other estate assets as part of the complete computation. Do not calculate the pension in isolation if its inclusion changes the available nil-rate bands, reliefs or the treatment of other assets. If the personal representatives have received contradictory residence advice, preserve both opinions and ask HMRC or a qualified adviser to state the precise statutory test applied.
The third review is the French result. Start again with Article 750 ter, the deceased’s French tax domicile, the beneficiary’s six-out-of-ten-year history and the situs of the pension interest. Then read the 1963 convention and its administrative commentary. A French notary may be handling the civil succession while the personal representatives handle the UK tax account; their roles should be coordinated, not treated as interchangeable. The fact that a UK administrator pays a beneficiary directly does not decide whether French succession tax applies.
Keep three tax columns in the working calculation:
- UK inheritance tax on the estate or notional pension property;
- French droits de mutation à titre gratuit on the transfer, after applying the domestic rules and the France–UK convention; and
- UK or French income tax on a pension payment, lump sum, annuity or other benefit.
The third column must not be used as a substitute for the first two. HMRC’s pension death-benefit guidance discusses reporting and income-tax treatment for particular benefits. It does not turn a recurring pension payment into a succession-tax credit, and a French income-tax declaration does not prove that a UK inheritance-tax liability has been paid.
If both countries tax the same value, identify the relief route before making a payment. The treaty may allocate the asset to one country or require the other country to give credit. Article 784 A may provide a domestic French credit in a defined case. The proof normally needs the foreign assessment, payment receipt, asset-by-asset computation, exchange-rate evidence and confirmation that the same tax has not already been credited elsewhere. A spreadsheet showing only “UK tax paid” is rarely enough.
The BOFiP commentary indicates that a treaty reduction or refund request can be subject to a five-year period from the death in the situations it describes. Treat that period as a final safety net, not as the working deadline. Ask for the claim to be prepared as soon as the UK and French assessments can be documented. The request should identify the convention article, the assets concerned, the country entitled to tax under the situs rule, the tax actually paid and the amount claimed back. If the authority asks for a certified translation or a form from the other country, record the request and answer it rather than allowing the file to become silent.
An assessment can be challenged even when the underlying tax principle is correct if the authority used the wrong value, currency, residence period, beneficiary relationship, scheme category or treaty article. The objection should be itemised. For example, one section might challenge the inclusion of an excluded death-in-service benefit; another might challenge the date used for a pension valuation; a third might seek treaty relief on the part taxed in both countries. A broad statement that the family is “taxed twice” does not show which legal error occurred.
Evidence exchanged between administrations must also be handled fairly. In Conseil d’État decision no. 311808 of 26 January 2011, concerning France–UK tax information and procedure, the court referred to a decision made “qu’au vu des seules pièces du dossier qui ont été communiquées aux parties”. In plain English, an authority should not base the dispute decision on material that the taxpayer has not been allowed to see and discuss. If a French reassessment relies on information obtained from the United Kingdom, ask for access to the material and the opportunity to respond. The official decision is available on Légifrance.
Civil jurisdiction can create a different procedural issue. In its first civil chamber judgment of 21 September 2022, pourvoi no. 19-15.438, the Cour de cassation considered an international succession involving a person habitually resident in the United Kingdom and assets in France. The decision is not a ruling that every pension of a French resident is taxable in France. It is a reminder that the court’s jurisdiction, the applicable succession law and the tax situs are separate steps. The Court’s wording required it to “doit relever d’office sa compétence subsidiaire” — raise its subsidiary jurisdiction of its own motion — in the circumstances examined. That procedural point should not be converted into a tax conclusion.
Consider an illustrative file. A British national who has lived in France dies on 10 April 2027 with a £600,000 unused defined-contribution pension, a French home, UK bank accounts and a French-resident spouse. The family should not ask only, “Is the pension taxed in France?” It should ask:
- Does the pension fall within the Finance Act 2026 category, and is any part excluded?
- Was the deceased a long-term UK resident under the post-2025 rules?
- What is the value at the relevant date, and what exchange rate is used?
- Does the French deceased-person or beneficiary residence test in Article 750 ter apply?
- Does the 1963 convention allocate the pension interest or provide a credit?
- Is the spouse exemption available under the UK and French rules actually engaged?
- Is the provider’s payment subject to a separate income-tax rule?
- Which personal representatives, notary and tax authority must receive each document?
The £600,000 figure is not a tax answer. It is only the fact that makes the date, scheme rules, residence history and treaty analysis financially important. If the provider includes the full amount in the UK account but the French return also taxes it, the family should obtain both calculations before accepting that double taxation is unavoidable. If the provider excludes the amount, the family should still retain the evidence showing why, because a later HMRC query may require the scheme administrator’s analysis.
If a challenge is needed, write a chronology. Include the death date, notification date, provider responses, HMRC or French assessment dates, payments, requests for information, translations and advice received. Attach the disputed calculation with the relevant line highlighted. Then state the correction sought: remove a benefit, substitute the proper valuation, apply an exemption, apply the convention, credit foreign tax or refund an overpayment. A chronology makes it possible for a lawyer, notary or tax authority to test the file without reconstructing the family’s history from emails.
The beneficiary should also avoid signing a settlement or waiver that describes the tax treatment inaccurately. A release requested by a provider may concern only the payment administration; it may not waive a statutory tax claim, but the wording should be checked. Equally, a French notary’s calculation of succession rights may be provisional until the UK assessment and treaty evidence are available. Ask what is final, what is provisional and which deadline is running.
Planning remains possible, but it must be coordinated. Review beneficiary nominations, spouse or civil-partner status, charitable intentions, the will, residence evidence and the likely personal representatives. If a QROPS or other overseas transfer is considered, review the transfer charge, reporting, French income-tax consequences and inheritance-tax location together. If an annuity is considered, verify whether the benefit is within an exclusion and how the continuing rights are valued. A change that reduces one tax exposure may increase another or make the family’s liquidity worse.
The general pension-tax article linked above can help with recurring pension income and treaty declarations. The existing guide on UK pension death benefits in France can help with the broader beneficiary-payment problem. This article’s distinct question is the 6 April 2027 inheritance-tax reform. Keeping those subjects linked but separate reduces the risk that an income-tax explanation, a beneficiary nomination or a French succession declaration is mistaken for an answer to the new UK inheritance-tax calculation.
Conclusion
For a British resident in France, the 6 April 2027 reform should trigger a file review, not a panic transfer. The decisive facts are the date of death, the exact pension arrangement, the deceased person’s UK long-term-residence history, the deceased and beneficiary’s French tax positions, the will and the 1963 France–UK inheritance-tax convention. The UK inheritance-tax computation, the French succession-tax computation and the income-tax treatment of a pension payment must be kept in separate columns before any credit or refund is claimed.
The safest next step is to obtain written scheme valuations and classifications, reconstruct both residence histories, preserve the will and nominations, and ask for an asset-by-asset explanation of any UK or French tax charge. If a calculation is wrong, challenge the precise line—date, value, scope, exemption or treaty relief—and keep the evidence of every request. Cross-border estates are manageable when the family identifies the legal question before accepting the first net payment.
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