Luxury Real Estate Investment in France – Legal & Tax Support | Sassi Law FIrm

Luxury Real Estate in France: Independent Legal and Tax Counsel for Foreign Buyers

Buying a property in Paris, on the Riviera or in the Alps from abroad is rarely difficult to do. It is difficult to do safely.

The French acquisition process is fast, formal, and largely irreversible once the preliminary contract is signed. Most of what can go wrong has already been decided by then: the ownership structure, the financing, the way the funds are evidenced, and what happens to the property when you die.

We are not real estate agents and we hold no interest in any transaction. We act for the buyer alone.

The point most foreign buyers discover too late

In France, the notaire is not your lawyer.

The notaire is a public officer. His duty is to authenticate the deed and to secure the transaction for both parties, not to advance your interests against the seller's. A single notaire commonly acts for buyer and seller alike, and that is perfectly lawful.

Nobody in the standard French process is contractually committed to you alone. The agent is paid by the seller. The notaire is neutral. That gap is what independent counsel fills.

How the acquisition actually unfolds

The preliminary contract, promesse or compromis de vente, is where the deal is made. Price, conditions precedent, deposit, penalties and timing are all settled here. It is signed long before the final deed.

The ten-day cooling-off period protects a private buyer after signature of the preliminary contract. It is short, it does not apply to every structure, and it is the last easy exit.

Conditions precedent must be drafted, not accepted as printed. Financing, planning searches, absence of pre-emption rights, condition of the building, tax rulings where relevant.

The final deed is signed two to three months later. By then, almost nothing remains negotiable.

What the acquisition really costs

Transfer duties and notarial costs come to roughly 7 to 8 % of the price for an existing property, and substantially less for a newly built one. These are not fees you can negotiate away, but they are figures you should have before you make an offer, not after.

Then come the recurring charges: local property tax, the second-home surcharge applied in high-demand areas, co-ownership charges, and, above a certain value, the annual real estate wealth tax. French Wealth Tax (IFI).

The 3 % tax that catches foreign structures

Legal entities that own French real estate are subject to an annual tax of 3 % of the property's market value, unless they disclose their shareholders and beneficial owners to the French authorities, or fall within one of the exemptions.

The exemption is not automatic. It depends on filing, on the entity's jurisdiction, and on whether France has the appropriate agreement with that jurisdiction. Entities established in certain financial centres do not qualify at all.

A structure chosen abroad for privacy can therefore generate a 3 % annual charge that nobody mentioned at the time of purchase, plus arrears.

Choosing how to own

There is no single right answer, only a set of trade-offs that depend on your family, your residence and your intentions.

•Direct ownership is simple and cheap to set up, but rigid on succession and on transferring part of the asset.

•A French SCI organises co-ownership within a family, allows gradual gifting of shares, and is transparent for the wealth tax.

•A foreign company may serve group or governance objectives, but raises the 3 % tax, the wealth tax look-through, and questions about where the entity is actually managed.

What matters is deciding before the preliminary contract. Changing the ownership vehicle afterwards means a second transfer, and a second set of transfer duties.

Succession: the rule nobody expects

French law protects children with a reserved share of the estate. A parent cannot freely disinherit them.

European rules allow a person to elect the law of their nationality to govern their succession, which can displace French forced heirship. But French law has since introduced a compensatory levy allowing children resident in the European Union, or who are EU nationals, to claim back from French assets what the foreign law denied them.

The practical consequence for an international family is that a will drafted abroad, without reference to the French property, often produces a different outcome from the one intended.

Source of funds: prepare it before you need it

The notaire and the French bank are subject to anti-money-laundering obligations. They will ask where the money comes from, and they will require documentary proof, not explanations.

For a buyer whose wealth was built abroad, over decades, through several entities or family transfers, assembling that file takes time. Started at the last moment, it delays completion. Started early, it is a formality.

We prepare this file as part of the acquisition, which is also why we are asked to intervene in cases where the question has already turned into a dispute. Tax crime and criminal tax defence.

Selling later

On resale, a non-resident is liable to French capital gains tax at 19 %, plus social levies, with reliefs that increase with the length of ownership and full exemption only after many years.

A seller resident outside the European Union or the European Economic Area must in most cases appoint an accredited tax representative in France before the sale can complete. This is a formality with a cost and a lead time, and it surprises sellers who expected to sign within weeks.

What we do

•Legal due diligence on title, the building, planning status, and any pre-emption rights.

•Negotiation and drafting of the preliminary contract, and of the conditions precedent.

•Choice and implementation of the ownership structure, in line with your succession objectives.

•A full tax projection: acquisition costs, annual charges, wealth tax, and the position on eventual resale.

•Preparation of the source-of-funds file and coordination with the notaire and the bank.

•Access to off-market opportunities through our professional network, with no commission from any seller.

We work in French and in English, for private clients, families and investors, with more than thirty years of practice in French tax, business and real estate law.

Frequently asked questions

Do I need a lawyer if there is already a notaire?

The notaire secures the deed for both parties. He does not negotiate on your behalf, does not choose your ownership structure, and does not plan your succession or your tax position.

Can a foreigner buy property in France?

Yes, with no restriction of nationality or residence. The difficulties are practical and fiscal, not legal.

Should I buy through a company?

Sometimes. But a company that owns French real estate may owe the annual 3 % tax, and it does not shelter you from the wealth tax. The decision must be made before signing.

Can I leave the property to whomever I wish?

Not freely. French law reserves a share for children, and a foreign will may be partially overridden. This is examined before purchase, not at the notary's office.

How long does a purchase take?

Usually two to three months between the preliminary contract and the final deed, provided the source-of-funds file and the financing are ready.