How do you sell an inherited property in France?

The certificate of ownership, a mandatory step before the sale

Before any sale, the transfer of the property to the heirs must be recorded in a notarial certificate of ownership (attestation immobilière), a deed registered with the French land registry (Articles 28 and 29 of Decree No. 55-22 of 4 January 1955 on land registration). Without this registration, the heirs cannot sign the final deed of sale, because the notaire must establish the chain of title.

A preliminary sale agreement can in practice be signed earlier, as soon as the devolution of the estate is established by the deed of notoriety (Article 730-1 of the French Civil Code); the certificate must be registered at the latest before the final signature.

Selling in joint ownership: unanimity, two thirds or partition

Until the estate is divided, the heirs hold the property in joint ownership (indivision): each owns an abstract share of the property. Selling the property is an act of disposal which in principle requires the consent of all the co-owners (Article 815-3 of the French Civil Code).

In the event of deadlock, co-owners holding at least two thirds of the joint rights can, under the procedure of Article 815-5-1 of the French Civil Code, have the sale authorised by the court, provided it does not excessively harm the other co-owners' rights: the intention to sell is expressed before a notaire, served on the other co-owners, and, failing agreement within three months, the court may authorise the sale, which then takes place by court-supervised auction (licitation). This procedure is excluded where the ownership of the property is split between usufruct and bare ownership. Finally, no one can be forced to remain in joint ownership: any heir may demand partition, which can lead to the property being sold by licitation (Article 815).

Capital gains: the estate value counts as the purchase price

If the property is resold for more than its value at the date of death, the capital gain is taxable. The purchase price used is the value that served as the basis for inheritance tax, that is, the value in the inheritance tax return (Article 150 VB of the French General Tax Code), increased, for their actual amount, by the costs of the gratuitous transfer: the inheritance tax relating to the property and the deed fees.

The capital gain is taxed at 19% income tax and 17.2% social levies, after allowances for the holding period counted from the death: full income tax exemption after 22 years of ownership (Article 150 VC of the CGI) and full exemption from social levies after 30 years.

The practical consequence: understating the property in the inheritance tax return may reduce the tax due on death, but it mechanically inflates the taxable capital gain on resale, on top of the risk of a tax reassessment. Conversely, selling quickly at the declared value in principle generates no capital gain.

Splitting the proceeds and special cases

• The sale price is shared between the heirs in proportion to their rights in the joint ownership, after payment of the estate's debts.
• The main-home exemption benefits only the heir who was actually occupying the property as their own main home on the day of the sale (Article 150 U, II-1° of the CGI); the deceased's main home is not exempt as such.
• If the heirs first carry out a partition with an equalisation payment, the 2.5% partition duty applies to the net assets divided (Article 746 of the CGI).
• Where an heir is a minor or a protected adult, the sale requires specific authorisations (guardianship judge or family council).