You have settled in France after Brexit, you pay your income tax here, and a French bank or insurance adviser has suggested an assurance-vie<\/i>. In Britain the phrase sounds like life cover. In France it means something much wider: the country’s favourite savings contract, a flexible envelope where your money can grow in a guaranteed fund or in market-linked units, where you can withdraw at any time, and where the pay-out on death follows its own tax rules outside the normal succession. For a British household holding a French home, sterling savings and perhaps a UK pension, the contract can be an excellent planning tool, or an expensive misunderstanding. The difference lies in the detail: who can open one as a British resident, how withdrawals are taxed while you live in France, what your spouse, partner or children will pay when you die, and how the contract interacts with your English will. This guide answers each question in turn, with the exact French legal texts, recent court decisions and the practical steps to challenge a wrong tax bill.<\/p>\nI. Opening and running a French assurance-vie as a British resident after Brexit<\/h2>\n
A. Can you open, keep and cash in an assurance-vie as a British resident in France?<\/h3>\n
An assurance-vie<\/i> is a contract between you, the souscripteur<\/i> (policyholder), and an assureur<\/i> (a French insurance company or a bank distributing its contracts). You pay in one or more primes<\/i> or versements<\/i> (premiums). The money is invested, at your choice, in a fonds en euros<\/i>, a guaranteed fund with a minimum annual return set by the insurer, or in unit\u00e9s de compte<\/i>, market-linked units such as shares in investment funds or property funds whose value moves up and down. You may hold both supports inside a single contract. You can ask for a rachat partiel<\/i> (partial withdrawal) or a rachat total<\/i> (full surrender) at any moment; there is no legal lock-in, although withdrawals in the early years suffer heavier tax, as explained below. You also name one or more b\u00e9n\u00e9ficiaires<\/i> (beneficiaries) in a clause b\u00e9n\u00e9ficiaire<\/i> (beneficiary clause), the private designation that decides who receives the capital when you die.<\/p>\n
Brexit changed nothing about your legal capacity to sign such a contract. The Insurance Code sets no nationality condition for the policyholder. In practice, French banks and insurers ask for proof of identity, proof of address in France and, very often, your French tax number and residence permit: a British citizen holding a Withdrawal Agreement card, a carte de s\u00e9jour<\/i> of another category, or a long-stay visa validated in France opens contracts every day. Difficulties arise only at the margins, for example where a distributor’s compliance software still flags British passports, or where a dual-resident client cannot show where they really live. If you split your time between the two countries, settle your tax residence first, because everything that follows, from the taxation of withdrawals to the treatment of the capital on death, depends on it. Our guide to proving French tax residence when a British couple lives between the two countries explains the evidence the administration expects, and our walk-through of the first French tax declaration shows which forms a newcomer files and how double tax is challenged.<\/p>\n
Once the contract is open, three practical points deserve attention. First, the eight-year clock that softens the tax on withdrawals runs from the subscription of the contract, not from each payment, so an old contract is worth keeping even if you stop paying into it. Second, draft the beneficiary clause with care and review it after every family event: marriage, divorce, birth, death. A standard clause naming “my spouse” can fail or misfire after a divorce and remarriage, and a clause naming children who predecease you needs substitutes. Many British spouses choose a d\u00e9membrement<\/i> of the clause, giving the surviving spouse the usufruit<\/i> (life interest, the right to use the capital and receive its income) and the children the nue-propri\u00e9t\u00e9<\/i> (bare ownership, the underlying capital recovered when the usufruct ends). The mechanism protects the survivor while preserving the children’s share, but it must be written precisely, because the insurer will pay exactly who the clause designates.<\/p>\n
Third, understand that the surrender value of a redeemable contract is not sheltered from your creditors while you are alive. The Cour de cassation held on 14 February 2024, appeal no. 21-25.616<\/a>, that “l’avis \u00e0 tiers d\u00e9tenteur notifi\u00e9, en application de l’article L. 263-0 A du livre des proc\u00e9dures fiscales, par le comptable charg\u00e9 du recouvrement saisit la valeur de rachat des droits r\u00e9sultant du contrat d’assurance rachetable auquel le redevable a souscrit ou dont il est adh\u00e9rent”. In plain terms, where you owe tax in France, the public accountant can serve a third-party notice on your insurer and seize the surrender value of your redeemable contract, even above the total premiums you paid. An assurance-vie<\/i> is therefore a savings and succession-planning envelope, not an asset-protection vault. If you receive such a notice, or if the insurer freezes the contract, act quickly: the time limits for challenging enforcement measures run in days and weeks, not months.<\/p>\n Only the gain is ever taxed. When you make a partial or total withdrawal, the insurer splits the payment between a return of your own capital, which is tax-free, and the produits<\/i>, the gains produced by the contract, which are taxable. The tax treatment of those gains turns on two things: the date the premiums were paid and the age of the contract. France distinguishes premiums paid before 27 September 2017, which keep the old sliding scale, from premiums paid from that date onwards, which fall under the flat-rate levy system. Because most British readers opening a contract today pay new premiums, this guide concentrates on the current system and flags the older one where it still matters.<\/p>\n For gains attached to premiums paid from 27 September 2017, the statute provides that “Le taux du pr\u00e9l\u00e8vement appliqu\u00e9 \u00e0 ces produits est fix\u00e9 \u00e0 : a) 12,8 %”. A reduced rate applies to older contracts: “b) 7,5 % lorsque la dur\u00e9e du contrat a \u00e9t\u00e9 \u00e9gale ou sup\u00e9rieure \u00e0 six ans pour les bons ou contrats souscrits entre le 1er janvier 1983 et le 31 d\u00e9cembre 1989 et \u00e0 huit ans pour les contrats souscrits \u00e0 compter du 1er janvier 1990”. In practice, withdrawals from a contract younger than eight years bear the 12.8% levy on the gain element, while withdrawals from a contract of eight years or more benefit from the 7.5% rate on that same element. The older premiums keep their historic scale, running from 35% down to “A 7,5 % lorsque cette dur\u00e9e a \u00e9t\u00e9 \u00e9gale ou sup\u00e9rieure \u00e0 six ans pour les bons ou contrats souscrits entre le 1er janvier 1983 et le 31 d\u00e9cembre 1989 et \u00e0 huit ans pour les contrats souscrits \u00e0 compter du 1er janvier 1990”. These rules sit in article 125-0 A of the General Tax Code<\/a>, the central provision for the taxation of life-policy income.<\/p>\n Two features soften the bill. First, the levy taken at source is not final. The statute states plainly of this deduction that “Ce pr\u00e9l\u00e8vement n’est pas lib\u00e9ratoire”, which means the gains must still be reported on your annual French income tax return, where you choose between the flat-rate route and the progressive income-tax scale. Households with little other income sometimes pay less by electing the scale; higher-rate taxpayers normally stay with the flat rate. The calculation is annual and personal, so revisit the choice each year rather than copying last year’s return. Second, after eight years an annual allowance shelters part of the gains: the law grants “un abattement annuel de 4 600 \u20ac pour les contribuables c\u00e9libataires, veufs ou divorc\u00e9s et de 9 200 \u20ac pour les contribuables mari\u00e9s soumis \u00e0 imposition commune” (article 125-0 A of the General Tax Code<\/a>). A married British couple filing jointly in France can therefore withdraw each year with up to 9,200 euros of gains free of income tax, provided the contract is old enough.<\/p>\n Income tax is only half the story. Social levies apply on top, and unlike income tax they admit no allowance and no election. The official service-public guidance states that gains from a life policy always bear CSG and CRDS social levies at a combined rate of 17.2%, with no allowance and no election. The full official page on how assurance-vie income is taxed<\/a> walks through the mechanics in English. One related trap catches British newcomers: where the levy was wrongly taken, or where an S1 healthcare certificate should have exempted you from part of the social charges, the refund has to be claimed through a formal r\u00e9clamation<\/i> (administrative claim) within the statutory deadline, with the S1, the tax notice and the insurer’s statements attached. Our analysis of CSG and CRDS charged on British pensions, with the S1 rates and the refund route, explains the same machinery that applies to policy gains.<\/p>\n As a French tax resident, you declare these gains in France. A person is treated as fiscally domiciled in France where, among other tests, they have “en France leur foyer ou le lieu de leur s\u00e9jour principal”, in the words of article 4 B of the General Tax Code<\/a>. Under the France\u2013United Kingdom double tax treaty, French residents report their worldwide savings income here and eliminate any double charge through the treaty’s relief mechanisms, while keeping an eye on any parallel reporting HM Revenue and Customs may require on the British side for the same year. Keep every insurer’s annual statement, the imprim\u00e9 fiscal unique<\/i> (the single annual tax statement the insurer sends you), and proof of the contract’s subscription date: if the administration disputes the eight-year seniority or the split between capital and gains, those three documents decide the case. If a reassessment arrives, challenge the gains computation first, because inspectors frequently misallocate the capital element, before disputing the rate.<\/p>\n The great attraction of the assurance-vie<\/i> is that the capital paid to a named beneficiary stays outside the estate. The Insurance Code provides that “Le capital ou la rente stipul\u00e9s payables lors du d\u00e9c\u00e8s de l’assur\u00e9 \u00e0 un b\u00e9n\u00e9ficiaire d\u00e9termin\u00e9 ou \u00e0 ses h\u00e9ritiers ne font pas partie de la succession de l’assur\u00e9” (article L132-12 of the Insurance Code<\/a>). The beneficiary is deemed to have owned the right from the day of the contract, “quelles que soient la forme et la date de sa d\u00e9signation”. Three consequences follow. The capital does not pass through the notaire’s<\/i> succession settlement. It is not divided under the intestacy rules or even under your will. And, in principle, it ignores the r\u00e9serve h\u00e9r\u00e9ditaire<\/i>, the forced share French law reserves to children.<\/p>\n The statute confirms the second point expressly: “Le capital ou la rente payables au d\u00e9c\u00e8s du contractant \u00e0 un b\u00e9n\u00e9ficiaire d\u00e9termin\u00e9 ne sont soumis ni aux r\u00e8gles du rapport \u00e0 succession, ni \u00e0 celles de la r\u00e9duction pour atteinte \u00e0 la r\u00e9serve des h\u00e9ritiers du contractant” (article L132-13 of the Insurance Code<\/a>). But the same sentence carries the exception that generates most litigation: “Ces r\u00e8gles ne s’appliquent pas non plus aux sommes vers\u00e9es par le contractant \u00e0 titre de primes, \u00e0 moins que celles-ci n’aient \u00e9t\u00e9 manifestement exag\u00e9r\u00e9es eu \u00e9gard \u00e0 ses facult\u00e9s.” Premiums that were “manifestly excessive” in light of the policyholder’s means can be pulled back into the estate and exposed to the forced-heirship claim. The Cour de cassation clarified the test on 19 December 2024, appeal no. 23-19.110 (ECLI:FR:CCASS:2024:C201213<\/a>): “les primes vers\u00e9es par le souscripteur d’un contrat d’assurance sur la vie ne sont rapportables \u00e0 la succession que si elles pr\u00e9sentent un caract\u00e8re manifestement exag\u00e9r\u00e9 eu \u00e9gard aux facult\u00e9s du souscripteur”, adding that “un tel caract\u00e8re s’appr\u00e9ciant au moment du versement, au regard de l’\u00e2ge, des situations patrimoniale et familiale du souscripteur ainsi que de l’utilit\u00e9 du contrat pour celui-ci”. The assessment is made payment by payment, at the date of each premium, looking at your age, your wealth and family situation, and whether the contract served a genuine purpose for you, such as providing for a spouse. A large premium paid at eighty-five that empties the estate invites challenge; regular measured payments funding a surviving spouse’s security do not. British families should keep bank statements, valuations and a note of the motive for each exceptional premium: that file is your defence if a child from a first marriage contests the clause.<\/p>\n Staying outside the succession does not mean escaping tax. France taxes the pay-out under one of two regimes depending on your age when you paid the premiums. Premiums paid before your seventieth birthday fall under article 990 I of the General Tax Code<\/a>. Each beneficiary enjoys a personal allowance, the taxable base being computed “puis d’un abattement fixe de 152 500 \u20ac”. Above that allowance, “Le pr\u00e9l\u00e8vement s’\u00e9l\u00e8ve \u00e0 20 % pour la fraction de la part taxable de chaque b\u00e9n\u00e9ficiaire inf\u00e9rieure ou \u00e9gale \u00e0 700 000 \u20ac, et \u00e0 31,25 % pour la fraction de la part taxable de chaque b\u00e9n\u00e9ficiaire exc\u00e9dant cette limite.” The levy is owed by the beneficiary but collected at source: “Le pr\u00e9l\u00e8vement pr\u00e9vu au I est d\u00fb par le b\u00e9n\u00e9ficiaire et vers\u00e9 au comptable public comp\u00e9tent par les organismes d’assurance”. Two important reliefs apply. A surviving spouse or PACS partner pays nothing, because “Le b\u00e9n\u00e9ficiaire n’est pas assujetti au pr\u00e9l\u00e8vement vis\u00e9 au premier alin\u00e9a lorsqu’il est exon\u00e9r\u00e9 de droits de mutation \u00e0 titre gratuit” (article 990 I of the General Tax Code<\/a>), and article 796-0 bis<\/a> provides that “Sont exon\u00e9r\u00e9s de droits de mutation par d\u00e9c\u00e8s le conjoint survivant et le partenaire li\u00e9 au d\u00e9funt par un pacte civil de solidarit\u00e9.” Naming your spouse as beneficiary therefore transmits the capital free of this levy, whatever the amount. The tax administration’s own guidance for beneficiaries confirms the allowance and the rates on impots.gouv.fr<\/a>.<\/p>\n Premiums paid after your seventieth birthday fall under the harsher article 757 B of the General Tax Code<\/a>. Such sums “donnent ouverture aux droits de mutation par d\u00e9c\u00e8s suivant le degr\u00e9 de parent\u00e9 existant entre le b\u00e9n\u00e9ficiaire \u00e0 titre gratuit et l’assur\u00e9 \u00e0 concurrence de la fraction des primes vers\u00e9es apr\u00e8s l’\u00e2ge de soixante-dix ans”, meaning ordinary succession duties apply according to kinship, with the children’s scale climbing quickly. Only a single global allowance softens the charge: “L’ensemble des sommes, rentes ou valeurs vis\u00e9es au I dues \u00e0 raison du ou des contrats conclus sur la t\u00eate d’un m\u00eame assur\u00e9 fait l’objet d’un abattement global de 30 500 \u20ac.” Note the contrast: 152,500 euros per beneficiary before seventy, 30,500 euros shared across all beneficiaries after seventy. Funding a contract late in life remains useful, particularly for a spouse who is exempt in any event, but large post-seventy payments to children or stepchildren need a clear-eyed computation first. The seventy-year threshold is assessed premium by premium, so statements showing the date of each payment are decisive.<\/p>\n One cross-border refinement matters for British families whose children live in the United Kingdom. The 990 I levy can follow a beneficiary who lives abroad. A child who grew up partly in France, or who returned to Britain only recently, may therefore still be within the levy even as a British resident. The statute catches a beneficiary with French fiscal domicile at death who held it “pendant au moins six ann\u00e9es au cours des dix ann\u00e9es pr\u00e9c\u00e9dant le d\u00e9c\u00e8s” (article 990 I of the General Tax Code<\/a>). Conversely, a beneficiary long settled in Britain with no recent French residence falls outside it. Where the insurer applies the levy mechanically to a non-resident beneficiary, the remedy is a reasoned claim retracing the ten-year residence history with tax notices, P60 equivalents, tenancy agreements and travel records.<\/p>\n Many British residents assume their English will governs everything they own. For the assurance-vie<\/i>, it does not. Because the capital never enters the succession, the beneficiary clause displaces the will: the insurer pays the person named in the clause even if the will says something different, and the will cannot override the clause. Review both documents together. A will that leaves “everything to my children in equal shares” alongside a policy naming only one child creates exactly the dispute the family wanted to avoid. Our guide to getting an English will past the French notaire<\/i>, with the choice of English law and the protection of a spouse, explains the will side of the equation; treat the beneficiary clause as its companion, not its subordinate.<\/p>\n The same logic applies to the choice of law you may have made under the European Succession Regulation. That regulation lets a person choose the law of their nationality to govern their succession, and France applies it to British nationals even after Brexit. But since the policy capital is not part of the succession, the choice of English law does not redirect it: the clause still rules. The regulation’s general framework, habitual residence as the default connecting factor and choice of national law as the permitted exception, is set out in Regulation (EU) No 650\/2012 on jurisdiction and applicable law in succession matters. Use the choice of English law to organise the house, the bank accounts and the rest of the estate, and use the beneficiary clause to organise the policy. Where the two overlap, for example where premiums are attacked as manifestly excessive and pulled back into the estate, the law chosen for the succession decides the forced-share computation, which is another reason to align both instruments with a single adviser.<\/p>\n Beyond the policy itself, remember that French succession tax has a worldwide reach once the deceased was fiscally domiciled in France. Article 750 ter of the General Tax Code<\/a> taxes movable and immovable property “situ\u00e9s en France ou hors de France” where the deceased held French fiscal domicile, so a British resident who dies domiciled in France leaves their French house and their UK house, their French accounts and their British accounts, inside the French succession filing. The notaire<\/i> draws up the d\u00e9claration de succession<\/i> (the estate return listing worldwide assets), values each asset, applies the allowances of each beneficiary, and computes the duties, while the policy proceeds travel through the separate 990 I or 757 B track described above. Our analysis of French inheritance tax for British heirs details the allowances and the treaty relief, and our report on the notaire<\/i> who refuses a British grant of probate shows what happens when the English paperwork does not satisfy the French file, with the remedies that unblock it.<\/p>\n The British side of the estate cannot be ignored either. The United Kingdom taxes estates under its own inheritance tax, which has moved to a residence-based system, so a British emigrant who has lived in France for many years may have a very different exposure than a recent arrival, and the interaction with the French duties must be mapped beneficiary by beneficiary. The official starting point is the gov.uk guidance on inheritance tax where someone lived outside the UK<\/a>, and our briefing on the post-April 2025 British inheritance tax position for French residents tracks the reform in detail. In practice, executors should obtain UK probate advice in parallel with the French settlement from the first weeks, because the two procedures request overlapping documents, grant of probate, death certificate with apostille, valuations, and each moves at its own pace.<\/p>\n When something goes wrong, each track has its own judge. A dispute with the insurer over the beneficiary clause, an unpaid claim or a contested surrender value goes to the tribunal judiciaire<\/i> (the ordinary civil court), after a complaint to the insurer and, where appropriate, to the insurance mediator. A dispute over the 990 I levy or the succession duties begins with a r\u00e9clamation contentieuse<\/i> to the tax office that issued the notice, then an appeal to the courts, with strict deadlines running from receipt of each decision. Never let a deadline expire while negotiating informally: file the protective claim first, keep negotiating afterwards. And never accept a double charge, French duties plus British tax on the same capital, without asking in writing for the treaty relief both administrations are bound to examine.<\/p>\n For a British resident in France, the assurance-vie<\/i> does three jobs at once: a flexible savings contract during your lifetime, with withdrawals taxed on the gains at 12.8% or 7.5% depending on the contract’s age plus 17.2% social levies and an allowance after eight years; a succession vehicle outside the estate, with 152,500 euros per beneficiary free of levy for pre-seventy premiums and full exemption for a spouse or PACS partner; and a cross-border instrument that must be coordinated with your English will, your choice of law and both countries’ estate taxes rather than left to contradict them. Open the contract once your French residence is established, draft the beneficiary clause as carefully as the will, watch the seventieth-birthday threshold for new premiums, and keep the statements that prove dates and amounts. Built that way, the contract carries a British family’s French savings to exactly the people intended, at the lowest lawful tax cost, with a clear route to challenge any bill that says otherwise.<\/p>\n Telephone consultation within 48 hours with a lawyer from the firm. We can review your assurance-vie contract, your beneficiary clause and any letter from the French tax administration with you. Call Ma\u00eetre Reda Kohen at +33 6 46 60 58 22<\/a>. Contact the firm<\/a>.<\/p>\n Source : Cour de cassation \u2013 Base Open Data \u00ab Judilibre \u00bb & \u00ab L\u00e9gifrance \u00bb.<\/p>\n","protected":false},"excerpt":{"rendered":" British resident in France? How a French assurance-vie is opened, how withdrawals are taxed, and what your spouse and children pay when you die.<\/p>\n","protected":false},"author":251031309,"featured_media":16275,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_kj_source_type":"","_kj_official_id":"","_kj_official_url":"","_kj_judilibre_id":"","_kj_jur":"","_kj_lieu":"","_kj_chambre":"","_kj_rg":"","_kj_date":"","activitypub_content_warning":"","activitypub_content_visibility":"","activitypub_max_image_attachments":4,"activitypub_interaction_policy_quote":"anyone","activitypub_status":"federated","footnotes":""},"categories":[80312,80314],"tags":[],"class_list":["post-2120776","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-british-desk","category-decryptage"],"yoast_head":"\nB. How are your withdrawals taxed while you live in France?<\/h3>\n
II. Passing the money on: what your loved ones pay when you die<\/h2>\n
A. What escapes the succession and what falls back into it<\/h3>\n
B. How does the contract interact with your English will and the cross-border estate?<\/h3>\n
Conclusion<\/h2>\n
Need a quick opinion on your case<\/h2>\n