HELPLINE: 
How to optimise your estate to support children and charity
The situation. Harmony*, a 72-year-old French tax resident, wanted to leave a significant part of her estate to a UK charity. However, French inheritance law enforces forced heirship (réserve héréditaire), meaning half of her estate would go to her child. Additionally, donations to non-French charities are subject to inheritance tax, reducing their impact.
Our strategy. She allocated the available 50% share to a French charity recognised as an ARUP (Association Reconnue d’Utilité Publique), which had ties to British charities, ensuring a tax-free donation. Then, by taking out an assurance vie, which allows assets to pass outside of forced heirship rules, she increased her charitable giving while reserving a substantial sum for her daughter.
Key takeaway. To win at mixing charity donations with succession law:
- Choose an ARUP for tax-free contributions.
- Leverage assurance vie.
- Balance investments carefully to avoid legal disputes.
*Names have been changed for confidentiality.