Your mother spent her last decade in the Dordogne, your brother still lives in Manchester, and a letter has just arrived from a French insurer addressed to you as beneficiary. Or the reverse: you live in France, your father never left Kent, and his French savings contract names you. In both cases the document in your hands is an assurance-vie, a French life-insurance savings contract, and it obeys French rules even when everyone holding it is British. The payout can be generous, the French tax treatment can be surprisingly kind, and the paperwork can still go wrong in ways that cost tens of thousands of euros: the wrong tax scale applied, an allowance forgotten across several contracts, an insurer that refuses to release the funds, or a sibling who claims the whole arrangement was built to disinherit them. Brexit added a further layer, because whether the French levy applies at all now turns on hard questions of tax domicile on each side of the Channel.

This guide explains, for a British reader, how France taxes the capital paid to the named beneficiary of an assurance-vie when the policyholder dies, how to get the insurer to pay, what to declare in Britain, and how to challenge a French bill that should never have been issued. Every French term is explained as it appears, every figure comes from the statute or the official tax website in force, and the two most recent Court of Cassation rulings on family challenges are quoted from the judgments themselves.

I. How France taxes your assurance-vie payout and what you keep

A. Premiums paid before seventy: the 152,500-euro allowance and the 20 and 31.25 per cent levy

The starting point is reassuring. Article L. 132-12 of the Insurance Code provides: « Le capital ou la rente stipulés payables lors du décès de l’assuré à un bénéficiaire déterminé ou à ses héritiers ne font pas partie de la succession de l’assuré. » In plain terms, the capital or annuity payable on death to a named beneficiary does not form part of the policyholder’s estate. That single sentence is why generations of French savers, and many British owners of French houses, have used the assurance-vie to pass money outside the ordinary succession, beyond the reach of the forced share of the children, the réserve héréditaire, subject to one famous exception examined below.

Outside the estate does not mean outside tax. Premiums paid before the policyholder’s seventieth birthday fall under article 990 I of the General Tax Code, which imposes a special levy, the prélèvement, on the share of each beneficiary. The statute grants, and I quote: « puis d’un abattement fixe de 152 500 €. Le prélèvement s’élève à 20 % pour la fraction de la part taxable de chaque bénéficiaire inférieure ou égale à 700 000 €, et à 31,25 % pour la fraction de la part taxable de chaque bénéficiaire excédant cette limite. » Each beneficiary therefore enjoys a fixed allowance of 152,500 euros on what they receive under all contracts taken out on the same insured person’s life, then pays 20 per cent on the taxable slice up to 700,000 euros and 31.25 per cent above that line. The official international page of the French tax administration confirms the mechanism in plain language and adds the essential practical point: levy is taken at source by the financial institution, so the figure that lands on your bank statement has already been taxed, and any challenge starts from the insurer’s computation.

Two worked examples show what this means for a British family. Suppose your late mother paid 300,000 euros of premiums before seventy and named you sole beneficiary. Subtract the 152,500-euro allowance and the taxable share is 147,500 euros, taxed at 20 per cent: the levy is 29,500 euros and you keep 270,500. Suppose instead the share is 1,000,000 euros. The taxable base after the allowance is 847,500 euros: 20 per cent on the first 700,000 gives 140,000 euros, and 31.25 per cent on the remaining 147,500 gives 46,093.75 euros, for a total levy of 186,093.75 euros. The allowance is per beneficiary and per insured person, not per contract, which is the trap for families where the deceased held three or four policies with different insurers: the 152,500 euros is shared across all of them. That is why article 990 I obliges you to hand every insurer, and I quote, « une attestation sur l’honneur indiquant le montant des abattements déjà appliqués aux sommes, rentes ou valeurs quelconques reçues d’un ou plusieurs organismes d’assurance et assimilés à raison du décès du même assuré. » A sworn statement listing the allowances already used on every payout received for the same deceased person. Sign it carelessly and you either overpay or invite a reassessment.

For a cross-Channel family the decisive question comes before any arithmetic: does the French levy apply at all. Article 990 I answers it in one dense sentence: « Le bénéficiaire est assujetti au prélèvement prévu au premier alinéa dès lors qu’il a, au moment du décès, son domicile fiscal en France au sens de l’article 4 B et qu’il l’a eu pendant au moins six années au cours des dix années précédant le décès ou dès lors que l’assuré a, au moment du décès, son domicile fiscal en France au sens du même article 4 B. » Three situations follow. If the deceased was fiscally domiciled in France at death, for example your mother in the Dordogne, the levy applies to every beneficiary wherever they live, including a son in Manchester who has never set foot in a French tax office. If the deceased lived in Kent but you, the beneficiary, were fiscally domiciled in France at death and had been for at least six of the previous ten years, the levy applies to you all the same. If neither condition is met, a London-domiciled father and a Manchester-domiciled daughter, the French levy is simply not due, even on a contract taken out with a French insurer, and any deduction the insurer made must be reclaimed. Since Brexit this territoriality test is litigated more often, because families who assumed a British death meant British tax only discover the six-in-ten-years rule attached to the beneficiary.

Two features soften the bill further. First, the surviving spouse and the partner bound by a civil solidarity pact, the PACS, the French registered partnership, pay nothing: article 990 I expressly releases every beneficiary who is already exempt from gratuitous-transfer duties. And article 796-0 bis of the same code states the underlying exemption without ambiguity: « Sont exonérés de droits de mutation par décès le conjoint survivant et le partenaire lié au défunt par un pacte civil de solidarité. » A British husband who survives his wife’s French contract therefore receives the capital clear of the levy, whatever the amount. Second, where the beneficiary clause itself is split, typically a surviving spouse given the usufruit, the life interest or usufruct, and the children given the nue-propriété, the bare ownership, each is taxed only on their slice: where a clause is split, article 990 I treats the bare owner and the life tenant as separate beneficiaries in proportion to their shares under the article 669 scale. Article 669 sets the age-based scale that splits full ownership between the life tenant and the bare owner The older the surviving spouse, the smaller the usufruct slice and the larger the children’s bare-ownership slice, each with its own 152,500-euro allowance. Finally, the levy is not a bill you pay yourself: « Le prélèvement prévu au I est dû par le bénéficiaire et versé au comptable public compétent par les organismes d’assurance et assimilés ou, dans le cas prévu au I ter, par la Caisse des dépôts et consignations, dans les quinze jours qui suivent la fin du mois au cours duquel les sommes, rentes ou valeurs quelconques dues par eux ont été versées aux bénéficiaires à titre gratuit. » The insurer withholds and pays over within fifteen days after the end of the month of payment, which means your remedy for an excessive deduction runs against a payment already made to the Treasury.

B. Premiums paid after seventy: the 30,500-euro pool and full succession duties

Everything changes for money paid in late. Article 990 I applies only to sums that fall outside the scope of article 757 B. Premiums paid after the policyholder’s seventieth birthday leave the levy behind and enter the world of ordinary succession duties under article 757 B of the General Tax Code: « donnent ouverture aux droits de mutation par décès suivant le degré de parenté existant entre le bénéficiaire à titre gratuit et l’assuré à concurrence de la fraction des primes versées après l’âge de soixante-dix ans. » Only the late premiums are caught, but they are taxed exactly as if they were an inheritance, at the rate set by your kinship with the deceased. The same article then grants a single shared allowance: « L’ensemble des sommes, rentes ou valeurs visées au I dues à raison du ou des contrats conclus sur la tête d’un même assuré fait l’objet d’un abattement global de 30 500 €. » One pot of 30,500 euros for all contracts on the same person’s life, divided among the beneficiaries, not 30,500 each. After that pot is exhausted, the ordinary succession scale runs, including, between parent and child, the familiar allowance of article 779: « il est effectué un abattement de 100 000 € sur la part de chacun des ascendants et sur la part de chacun des enfants vivants ou représentés par suite de prédécès ou de renonciation. »

Take a concrete British case. Your father, retired in Kent, paid 40,000 euros into his French contract at sixty-five and another 100,000 at seventy-three, and named you, his only child, beneficiary. The 40,000 falls under article 990 I: covered in full by your 152,500-euro allowance, no levy. The 100,000 falls under article 757 B: subtract the shared 30,500-euro pot and 69,500 remains, then subtract your 100,000-euro parent-to-child allowance and nothing is taxable. Had he named a friend instead, the same 69,500 euros would face the stranger’s top rate, which is why the identity of the beneficiary matters far more after seventy than before. And had he paid a single top-up one month after his seventieth birthday, that top-up alone would sit in the harsher regime while everything paid before stays in the kinder one, so the exact payment dates on the insurer’s statements deserve the same attention as the totals. Broadly, before seventy the contract behaves like a taxed-but-sheltered envelope with a large per-beneficiary allowance; after seventy it behaves like a will substitute with a small shared allowance and kinship rates. Families who grasp that contrast early can still act on it while the policyholder lives, by naming the spouse, by splitting the clause between usufruct and bare ownership, or simply by declining to feed a contract that has crossed the age line when a different vehicle would cost less in duty.

II. Getting the money released and challenging the bill

A. How to get the insurer to pay: beneficiary search, clause wording and form 2705-A

Money does not move by itself, and British beneficiaries lose months at four predictable stages. The first is finding the contract. France runs a no-charge national search service for exactly this situation, and the official public-service website confirms that anyone may ask whether a deceased person held a policy; the request goes to Agira, the association that centralises insurers’ data: « Il faut interroger l’Agira. » and a request to Agira costs the applicant nothing. File one search per deceased person, with the death certificate, and every insurer holding a contract on that life must answer. For a British family that suspects a parent held a French policy but never saw the paperwork, this search is the indispensable first step, and it should be filed even before approaching the notaire, the French probate lawyer who settles the estate, because the notaire cannot distribute what nobody has found.

The second stage is proving you are the right person in the right rank. Read the beneficiary clause, the clause bénéficiaire, line by line: it names beneficiaries in ranks, and a later clause revokes the earlier one, so an ex-spouse named in 2015 may have been silently replaced by children named in 2021. If you are named in the first rank and alive, the capital is yours; if the first-rank beneficiary died before the policyholder or refused, the money falls to the second rank, and if no beneficiary survives or accepts, the capital rejoins the estate and your fight becomes an ordinary succession dispute. Assemble the dossier before you write: the death certificate, your passport, proof of your address and tax residence, your bank details, and, where the same deceased held several contracts, the running tally of allowances already used. That tally matters because the insurer cannot apply your 152,500-euro allowance in full if a sister contract already consumed part of it, and the sworn statement quoted above is the document on which the insurer relies. British beneficiaries should also state their tax residence precisely and in writing, because the insurer’s withholding turns on the territoriality test, and an ambiguous file invites the maximum deduction.

The third stage is the tax clearance. The international page of the tax administration warns that, to obtain the certificate of payment or non-liability that alone allows the insurer to release the funds, the tax office requires a form 2705-A filed with payment before it issues the certificate. Form 2705-A is the partial succession return used for insurance payouts; the insurer will not pay out on a simple letter while the Treasury has not issued its certificat d’acquittement ou de non-exigibilité, the certificate of discharge or non-liability. Non-resident beneficiaries file with the office named on that same official page, and the file must reconcile every contract on the same life, pre-seventy and post-seventy amounts kept strictly apart. Where the money has already drifted to the Caisse des dépôts et consignations, the public depository that receives unclaimed insurance funds, all is not lost: article 990 I extends the same levy to sums paid out to the beneficiary by the Caisse des dépôts, which confirms that a payout recovered years later from the depository is taxed under the same rules, with the same allowances, as a payout collected on time.

The fourth stage sits in London, not Paris. A British beneficiary who receives a French payout must consider the British tax return. The official helpsheet on foreign policies covers gains arising from foreign life insurance policies. Gains on such policies are, in the helpsheet’s own words, « taxable as income rather than capital gains », and the same helpsheet warns that certain contracts, the personal portfolio bonds that let the holder select the underlying assets, trigger an annual charge whether or not cash was paid out. Keep the insurer’s chargeable-event certificate and the proof of the French levy deducted at source, report the gain through Self Assessment, and take British advice on domicile and double-tax relief before assuming the French deduction settles everything. The French file and the British file must tell the same story about dates, amounts and residence.

B. How to challenge an excessive bill or a sibling’s claim to claw the money back

Four disputes return again and again in British files, and each has a clear remedy. The first is the wrong scale: pre-seventy premiums taxed under article 757 B, or post-seventy premiums pushed into the 990 I levy. Rebuild the computation contract by contract from the insurer’s statements, separating every premium by its payment date against the seventieth birthday, then file a written claim, a réclamation contentieuse, with the tax office, attaching the statements, the allowance tally and the corrected arithmetic. Time is short and the deadline is statutory: claims must reach the administration by 31 December of the second year following either the recovery notice or, where no assessment was issued, the payment of the disputed tax. In practice, the French levy withheld by the insurer falls under the second limb, the payment of the disputed tax, so count two Decembers from the year of withholding and file early, because a late claim fails whatever its merits.

The second dispute is territoriality, the most winnable and the most missed. Where neither the deceased nor the beneficiary was fiscally domiciled in France at death, answer the levy with the statute itself and demand restitution of the withholding, with interest. Where the insurer applied the levy only because you once lived in Lyon, check the six-in-ten-years condition year by year: short student postings and brief returns do not always add up to six years of fiscal domicile, and the burden of proving each year’s domicile is a matter of leases, tax notices and centre-of-interests evidence, not of impression. Mirror cases arise where the deceased lived in France but a beneficiary argues the contract’s premiums were paid from London funds into a Luxembourg policy: the statute looks at domicile, not at the currency or the booking centre, so aim the evidence at residence, the only test that counts.

The third dispute comes from inside the family. A brother or sister who sees a large policy pass to you may ask the court to pull the premiums back into the estate, the rapport à succession, or to cut them down to protect their forced share, the réduction pour atteinte à la réserve. Article L. 132-13 of the Insurance Code sets the only door through which such a claim can pass: « Ces règles ne s’appliquent pas non plus aux sommes versées par le contractant à titre de primes, à moins que celles-ci n’aient été manifestement exagérées eu égard à ses facultés. » Premiums escape both the bringing-back and the clawback unless they were manifestly excessive in light of the policyholder’s means. The Court of Cassation has just restated, twice in five months, exactly how that test works. On 30 April 2025 the First Civil Chamber quashed an appeal ruling that had ordered over 223,124.21 euros of premiums back into the estate by comparing them with an estate valued at 694,397.62 euros, holding: « Un tel caractère s’apprécie au moment du versement, au regard de l’âge, des situations patrimoniale et familiale du souscripteur ainsi que de l’utilité du contrat pour celui-ci. » The full holding reads: « les primes versées par le souscripteur d’un contrat d’assurance sur la vie ne sont rapportables à la succession ou soumises à réduction que si elles présentent un caractère manifestement exagéré eu égard aux facultés du souscripteur. » On 19 December 2024 the Second Civil Chamber said the same in a case where an appeal court had condemned a late premium although the earlier premiums had been proportionate to the saver’s estate, repeating: « un tel caractère s’appréciant au moment du versement, au regard de l’âge, des situations patrimoniale et familiale du souscripteur ainsi que de l’utilité du contrat pour celui-ci. » For a British beneficiary under attack, the defence file practically writes itself: the policyholder’s age and health at each payment date, their income, property and savings at that date, the family charges they still bore, and the genuine purpose of the contract, protecting a spouse, balancing unequal gifts, holding the proceeds of a house sale. A court may not simply weigh the premiums against the estate left behind, and a policy that looked sensible when a healthy sixty-year-old with a paid-off house signed it cannot be rewritten with hindsight because the estate later shrank.

The fourth dispute is the quietest: allowances consumed without trace. Where the deceased held policies with several insurers, each insurer deducts on the basis of your sworn statement, and an error in that statement follows you from file to file. If you discover that an earlier payout already used half your allowance, correct the later filings before the tax office does, pay the supplement with the 2705-A, and keep every certificate, because the same paper trail will be demanded again if a sibling opens a rapport action or if HM Revenue and Customs asks what foreign tax was actually paid. And if the insurer itself stalls, register every exchange in writing, set a firm deadline in a formal demand, and place the file before the court with the clause, the death certificate and the 2705-A certificate in hand: an insurer that holds identifiable beneficiary money without a genuine dispute over rank or tax rarely survives the hearing.

Conclusion

A French assurance-vie remains one of the kindest envelopes a British family can inherit: capital outside the estate, 152,500 euros per beneficiary sheltered from the levy on pre-seventy money, a surviving spouse fully exempt, and a usable, if narrower, regime after seventy. Its dangers are procedural, not conceptual: the wrong scale applied to the wrong premiums, a shared allowance split across contracts nobody reconciled, a levy withheld where no French domicile supported it, or a sibling’s clawback action answered too late. Work contract by contract and date by date, file the Agira search and the 2705-A early, keep the French levy receipts for the British return, and challenge quickly, because the thirty-first of December of the second year arrives faster than grieving families expect. Done in that order, the beneficiary keeps what the statute promised and pays nothing it did not owe.

Need a quick opinion on your case

Insurer blocking the payout, levy that looks wrong, or a sibling contesting the beneficiary clause. Our firm offers a telephone consultation within 48 hours with a lawyer of the firm. Initial telephone consultation: 80 EUR including VAT. Call +33 6 46 60 58 22 or write via our contact page with the policy, the insurer’s computation and the death certificate to hand.