Inheritance in France for a Paraguayan Resident: Procedure and Taxation 2026
You live in Paraguay, with your cédula in hand, and have established tax residency. One day, the phone rings from France: a relative has passed away, and you are inheriting. An apartment in Lyon, an account at Société Générale, a life insurance policy, a securities portfolio, perhaps a family home, and sometimes debts. What happens next? What inheritance taxes must you pay, in France, in Paraguay, or in both? Do you need to return to France, or can everything be managed from Asunción?
International succession involves two legal systems and two tax administrations. This guide covers the complete procedure, applicable taxation, and asset management of a French inheritance for a Paraguayan resident.
Which law applies to the succession?
The European Succession Regulation (650/2012)
First question to settle: which law governs the succession of your deceased relative in France?
- The principle: European Regulation 650/2012, applicable since 2015, subjects the succession to the law of the country of the deceased's last habitual residence. If your relative lived in France at the time of death, French law applies to the entire succession, both to assets located in France and abroad. This regulation applies to French citizens even when the heirs live outside the European Union, such as in Paraguay.
- The exception, professio juris: the deceased could choose by will the law of their nationality (Article 22 of the Regulation). A French parent who designated French law does not change the outcome. However, a Franco-Paraguayan dual national parent who opted for Paraguayan law would see that law govern their succession.
- In practice: in the vast majority of cases, the deceased parent lived in France, and French law applies. The French notary then handles the succession, regardless of the heirs' country of residence.
French succession law: the main principles
-
The forced heirship reserve: French law protects the deceased's children, known as forced heirs. The reserve is the minimum share that must come to them:
- 1 child: reserve of 1/2 of the succession (available portion of 1/2).
- 2 children: reserve of 2/3 (available portion of 1/3).
- 3 children or more: reserve of 3/4 (available portion of 1/4).
- The surviving spouse: when all children are common to the couple, the spouse chooses between the usufruct of the entire succession and 1/4 in full ownership. If the children are not all common, they receive 1/4 in full ownership, without the usufruct option. Since the TEPA law of 2007, the surviving spouse is exempt from inheritance tax.
- The order of heirs: first come the descendants (children, grandchildren), then parents with siblings, then ascendants, and finally ordinary collateral relatives (uncles, aunts, cousins). If the deceased has children, they inherit first, alongside the surviving spouse.
Inheritance taxes in France for an heir in Paraguay
The principle: France taxes assets located in France
As an heir residing in Paraguay, you are liable for French inheritance taxes on assets located in France, and sometimes beyond, depending on your residency history:
| Situation | Taxable assets in France | Legal basis |
|---|---|---|
| The deceased resided in France | All of the deceased's assets, in France and abroad, are subject to French inheritance tax. | Article 750 ter I of the CGI |
| The heir has resided in France for at least 6 years out of the last 10 years | All received assets, in France and abroad, are subject to French tax, even if the deceased did not reside in France. | Article 750 ter II of the CGI |
| Neither of the two conditions is met | Only assets located in France are subject to French inheritance tax. | Article 750 ter III of the CGI |
The most common case: your parent resided in France, so all of their assets are subject to French inheritance tax (Article 750 ter I). Your residence in Paraguay does not change this: it is the deceased's residence that determines French tax jurisdiction.
The case of Article 750 ter II: if you yourself have resided in France for at least 6 years out of the last 10 years, you are taxable in France on all assets received, including those located outside France. If you moved to Paraguay less than 4 years ago after living in France, you are still within this window. If you have been living there for 5 years or more, you are out of it: only assets located in France remain taxable.
Allowances and the inheritance tax scale
| Relationship with the deceased | Allowance | Tax scale (beyond the allowance) |
|---|---|---|
| Child (direct line) | €100,000 per child | 5% up to €8,072, 10% from €8,073 to €12,109, 15% from €12,110 to €15,932, 20% from €15,933 to €552,324, 30% from €552,325 to €902,838, 40% from €902,839 to €1,805,677, 45% beyond |
| Surviving spouse | Total exemption (TEPA law 2007) | 0%, no inheritance tax between spouses |
| Brother / sister | €15,932 | 35% up to €24,430, 45% beyond |
| Nephew / niece | €7,967 | 55% |
| Other heirs | €1,594 | 60% |
The concrete calculation: inheriting €300,000 as a child
| Item | Amount |
|---|---|
| Value of the inherited share | €300,000 |
| Child allowance | -€100,000 |
| Taxable base | €200,000 |
| Inheritance tax (progressive scale) | ~€38,194 (5% on 8,072 + 10% on 4,037 + 15% on 3,823 + 20% on 184,068) |
| Net received after tax | ~€261,806 |
For an inheritance of €300,000 received by a child, the taxes amount to approximately €38,194, or 12.7% of the total. The effective rate increases with the amount: approximately €178,000 in taxes (17.8%) for a share of one million euros, approximately €473,000 (23.7%) for two million.
Inheritance taxes in Paraguay: 0%
Paraguay applies no inheritance tax. Assets located in Paraguay (real estate, local bank accounts) are transferred without tax. And if you inherit French assets, Paraguay does not tax them a second time: only French taxes are due. There is no bilateral tax treaty between France and Paraguay on this matter, but since Paraguay simply does not tax inheritances, no conflict of double taxation arises.
Life insurance: the specific regime
Life insurance is outside the scope of inheritance
French life insurance contracts are subject to their own regime: they are outside the scope of inheritance (Article L132-12 of the Insurance Code).
- The principle: the death benefit is paid to the designated beneficiary in the contract, and not to the legal heirs, unless the beneficiary is an heir themselves. This capital is exempt from inheritance rules and forced heirship, within the limit of premiums that would not be manifestly excessive.
-
Taxation: the death benefit follows a regime distinct from classic inheritance taxes:
- Premiums paid before age 70 (Article 990 I of the CGI): allowance of €152,500 per beneficiary, then tax of 20% up to €700,000 and 31.25% beyond. Significantly more favorable than the inheritance scale.
- Premiums paid after age 70 (Article 757 B of the CGI): a global allowance of €30,500, for all beneficiaries combined, then application of classic inheritance taxes. Less advantageous, but the contract's interest and capital gains remain exempt: only premiums paid after age 70 are taxed, not the capitalization.
- The impact of your residence in Paraguay: as a beneficiary of a French contract living in Paraguay, you remain subject to the French tax regime (990 I or 757 B). The location of the contract and the deceased's residence are what matter. Paraguay, for its part, taxes nothing: no double taxation.
- Payment to a non-resident beneficiary: some insurers require additional supporting documents (certificate of residence, identity document, international bank details). The capital can be paid into your French account if you have kept one, or by international SWIFT transfer, within 3 to 7 business days. Allow 2 to 6 months for processing, compared to 1 to 3 months for a beneficiary residing in France: longer, but payment is guaranteed.
The succession procedure from Paraguay
The stages of succession in France
- Death and declaration: the death is declared at the town hall of the place of death, by the family or funeral directors, and the death certificate is issued. The notary is then contacted, either the family's notary or a notary chosen by the heirs.
- Opening of the succession: the notary searches for any will in the Central File of Last Wills, identifies the heirs by the deed of notoriety, and draws up an inventory of assets and liabilities.
- Declaration of succession: it is filed with the tax office of the deceased's last domicile, within 6 months after a death occurring in France, or 12 months for a death abroad. Any delay incurs interest of 0.20% per month, plus a 10% penalty after formal notice.
- Payment of taxes: taxes are paid upon filing the declaration, in one lump sum or in installments over 1 to 3 years for large amounts, with a possible deferral in the case of bare ownership. They must be paid before the distribution of assets: in practice, the notary deducts them from the estate's assets or the heirs advance the funds.
- Distribution: once the taxes are paid, the notary distributes the assets according to law or will. The deed of distribution is signed by all heirs, in person or by proxy, then the assets are transferred: real estate transfer, liquid funds transfer, securities transfer.
Managing succession from Paraguay
You are not obliged to return to France: everything can be done remotely.
- Notarized power of attorney: you mandate a trusted person in France (brother, sister, friend, lawyer) to sign on your behalf the deed of notoriety, the declaration of succession, the deed of distribution, and any sales. The power of attorney is drawn up before a public notary (escribano público) in Paraguay, apostilled, translated by a sworn translator, and then sent to the French notary. Expect to pay between 100 and 300 USD in total.
- Consular power of attorney: a simpler alternative, signing at the consular section of the French Embassy in Asunción. A consular power of attorney is directly recognized in France, without apostille or translation, for a modest or even no fee. This is generally the quickest option.
- Electronic signature: some notaries accept videoconferencing with digital signature for succession acts, a practice that has become widespread since Covid. Ask your notary about this.
- Travel: for a complex succession, with multiple assets, a dispute between heirs, or a sale, one or two trips to France may still be necessary. A round-trip flight from Asunción to Paris, costing between 800 and 1,500 USD, is deductible from the succession management fees. For a simple succession, a power of attorney is sufficient.
The role of the notary
The notary is the central actor in succession in France.
- Choice of notary: the deceased's family notary is the natural choice, as they know the assets and wishes. In case of disagreement among heirs, each can choose their own notary; they collaborate, but fees increase.
-
Notary fees: emoluments are regulated and proportional to the assets:
- Deed of notoriety: approximately €57 to €70 (fixed fee).
- Declaration of succession: approximately 0.434% of gross assets beyond €6,500.
- Deed of distribution: approximately 1.033% of distributed assets beyond €6,500.
- Copies, formalities, and disbursements: €500 to €2,000 depending on the case.
- Remote communication: most notaries work via email and phone with heirs abroad. The time difference between Asunción and Paris, 5 to 6 hours, is manageable: a call in the early afternoon in Paraguay falls in the late afternoon in France. Documents are sent via email for scans, and by DHL or FedEx for originals, at 50-100 USD per shipment.
What to do with inherited assets?
Real estate in France
You inherit an apartment or a house in France. Three options are available to you:
| Option | Description | Tax consequences | Recommendation |
|---|---|---|---|
| Sell the property | You sell the inherited property and repatriate the proceeds of the sale to Paraguay. | The capital gain is calculated between the selling price and the value declared in the succession, not the deceased's initial purchase price. A quick sale, within one year of death and at the declared price, results in no capital gain, thus no tax. A later sale at a higher price is taxed at 19% plus 17.2% for social security contributions, with holding period allowances counted from the date of death. For a non-resident, a tax representative is mandatory for selling prices above €150,000. | The recommended option if you do not plan to return to France. Sell within 12 months for minimal capital gains, then repatriate the funds to Paraguay. |
| Rent it out | You keep the property and collect rent from Paraguay. | Rental income is taxed in France at a minimum rate of 20% for non-residents, plus 17.2% for social security contributions, totaling approximately 37.2%. In addition, there are property taxes (taxe foncière) and remote management by an agency, costing 6% to 10% of the rent. | Viable in a dynamic rental market like Paris, Lyon, or Bordeaux. However, taxation is heavy and management is cumbersome. If the net yield after taxes and fees falls below 3%, it is better to sell and reinvest in Paraguay. |
| Keep as a secondary residence | You keep the property as a pied-à-terre for your stays in France. | No income, therefore no income tax. But annual property tax (taxe foncière) of €1,000 to €5,000 depending on the property, condominium fees, maintenance, insurance, and sometimes vacant housing tax. | A heartfelt choice, for a family home. Calculate the annual cost of retention and compare it to the proceeds of a sale invested in Paraguay before deciding. |
Bank accounts and financial investments
- Deceased's bank accounts: they are blocked upon death, as soon as the bank is informed by the notary or civil registry. The notary releases the funds after tax payment and distribution. Your share is transferred to your French account if you have one, or by international SWIFT transfer, within 3 to 7 business days.
- Savings accounts (Livret A, LDDS, LEP): closed upon death, interest stopped on that date, balances included in the succession and distributed after division.
- The PEA (Share Savings Plan): it is closed upon the death of the holder. The capital gain accumulated by the deceased is cleared by the succession: securities are valued at their value on the day of death for tax purposes. If you inherit the securities and then sell them, your capital gain is calculated from this value, not from the initial purchase price.
- Life insurance: see the dedicated section. The capital is paid directly to the designated beneficiary, without going through probate, to their French or foreign account.
- Ordinary securities account: securities are valued on the day of death and included in the estate. Heirs can receive them in kind, by transfer to their own securities account, or have them sold and receive the proceeds. Check with your broker if they accept inbound transfers; otherwise, sell them and repatriate the funds.
Repatriating funds to Paraguay
Once the duties are paid and the distribution is made, you can repatriate the funds:
- SWIFT transfer: from the French account to your Paraguayan bank account or your company's account. Fees range from €20 to €50 per transfer depending on the bank, with no legal limit on the amount. For amounts over €10,000, the bank may ask for proof of funds origin: the notarized deed of distribution is sufficient.
- Wise: better exchange rate, fees of 0.5% to 1.5% of the amount, 1 to 3 days delivery time. For amounts over €50,000, Wise generally requests the deed of succession as proof.
- Destination of funds: your US LLC account if you invest through your structure (the contribution is documented in the LLC's accounting), or a personal Paraguayan bank account for personal use, real estate purchase, current expenses or savings, in USD or Guaraníes.
- Taxation of repatriation: transferring inherited funds from France to Paraguay is not a taxable event. The inheritance has already been taxed in France, Paraguay does not tax inheritances, and the transfer is neither income nor capital gain. Simply keep the deed of succession to justify the origin of the funds if your bank or the DNIT requests it.
Inheritance and wealth structuring in Paraguay
Integrating inheritance into your Paraguayan assets
A French inheritance is a capital injection into your assets, and Paraguay offers a particularly favorable framework for growing it:
| Inherited amount (after duties) | Investment strategy in Paraguay | Expected return (7%/year) | Value after 10 years |
|---|---|---|---|
| €50,000 | ETFs via an international broker, dividends and capital gains untaxed in Paraguay | 7%/year | ~€98,000 |
| €150,000 | Mix: €100,000 in ETFs + €50,000 in Paraguayan real estate (rental apartment in Asunción) | ETFs 7%/year + real estate 5 to 8%/year (net rent and appreciation) | ~€300,000-€350,000 |
| €300,000 | Mix: €200,000 in ETFs + €100,000 in Paraguayan real estate (2 rental apartments) | ETFs 7%/year + real estate 5 to 8%/year | ~€600,000-€700,000 |
| €500,000 | Mix: €300,000 in ETFs + €150,000 in real estate + €50,000 invested via US LLC | ETFs 7%/year + real estate 5 to 8%/year + variable business | ~€1,000,000-€1,200,000 |
The key point: the gains generated by inherited funds invested from Paraguay are 0% for foreign-source income, ETF dividends, and capital gains, and 8% to 10% IRP for local-source rents. In France, these same gains would be subject to 30% PFU or the progressive scale with social security contributions. Paraguay greatly increases the net return on your inheritance.
Keep assets in France or repatriate everything?
- Arguments for repatriating: investment gains untaxed in Paraguay versus over 30% in France, simplified management without French declarations, no property tax or rental agency, and concentrated assets, simpler to manage and pass on.
- Arguments for keeping: geographical diversification, the long-term value of real estate in major French cities, French life insurance and its €152,500 tax-free allowance per beneficiary, and a pied-à-terre that facilitates a potential return.
- Our perspective: repatriate liquid assets (accounts, liquidated PEA, proceeds from real estate sales) and invest them from Paraguay. Keep French life insurance from which you are a beneficiary; it's a transmission tool that's hard to beat. And if you keep a property in France, check that its net return after tax, charges, and management justifies keeping it; otherwise, sell and reinvest.
The case of joint ownership among heirs
Joint ownership of an estate
If you inherit with other heirs, the assets remain in joint ownership until distribution:
- The principle: each heir holds a share, for example, one-third for three children. Important decisions—sale, rental, renovations—require the agreement of all, or two-thirds for administrative acts (Article 815-3 of the Civil Code).
- The problem from a distance: joint ownership is a conflict-prone situation, with each person having their own interests: one wants to sell, another to keep, the third to rent. From Asunción, managing these arbitrations is particularly burdensome.
-
The solution: exit joint ownership as quickly as possible. Four ways:
- Amicable division: the heirs divide the assets by mutual agreement—one takes the apartment, another the liquid assets, the third the life insurance—and sign a notarized deed of division. This is the simplest and fastest way.
- Sale of the jointly owned property: if everyone agrees, the notary organizes the sale and distributes the proceeds. Faced with an opponent, co-owners holding two-thirds of the shares can request judicial authorization to sell (Article 815-5-1 of the Civil Code).
- Purchase of shares: an heir buys the shares of the others and becomes the full owner, subject to a division fee of 1.10% on the acquired value.
- Licitation: judicial auction, a last resort when nothing else works.
- Joint ownership agreement: if exiting takes time, a notarized agreement organizes the interim: who manages, who pays charges, who collects rents, under what conditions to sell. It can be concluded for 5 years renewable and include a pre-emption right between co-owners.
The deceased's debts
Inheriting debts
In France, an inheritance includes both assets and liabilities: heirs also receive the deceased's debts.
- Outright acceptance: You receive the assets and the debts. If the debts exceed the assets, you pay the difference from your personal property. This is the default mode and the riskiest when faced with uncertain assets.
- Acceptance up to the value of the net assets: Your liability is capped at the value of the inherited assets. If the debts exceed the assets, you do not pay the difference. This is the prudent option in case of doubt, hidden debts, guarantees, or ongoing disputes. It requires a declaration to the registry of the judicial court, publication, and an inventory within 2 months: more complex, but protective.
- Renunciation: You receive nothing, neither assets nor debts, by declaration to the registry. Renunciation is total; it is impossible to cherry-pick. If liabilities clearly exceed assets, this is the rational decision.
- Deadline: You have 4 months after the death to choose. After this period, a creditor or co-heir can formally request a response within 2 months; without a response, you are presumed to have accepted outright. From Paraguay, monitor these deadlines closely: distance is not an acceptable excuse.
Specific mistakes for the expatriate heir
Mistake 1: Ignoring the estate or not responding to the notary
Silence means outright acceptance once the deadlines have passed, including debts. Respond to the notary as soon as the death is announced, and if in doubt about the estate, opt for acceptance up to the value of the net assets. Never remain silent.
Mistake 2: Not giving power of attorney
Without a power of attorney, every document requires your original signature, meaning 2 to 4 weeks for postal round trips between Asunción and Paris each time. Give a power of attorney from the start, either consular at the French Embassy in Asunción or a notarized Paraguayan apostilled one, and your agent will sign everything on your behalf.
Mistake 3: Exceeding the inheritance tax declaration deadline
Six months after a death in France, twelve months for a death abroad. Beyond that, 0.20% interest per month and a 10% surcharge: on an estate of €300,000, several thousand euros go to penalties. Mandate the notary to file on time and set reminders in your calendar.
Mistake 4: Selling real estate too late
A quick sale at the price declared in the inheritance does not generate any taxable capital gains. Waiting several years in a rising market creates a capital gain taxed at 19% plus 17.2% social contributions. If you do not intend to keep the property, sell it within 12 months: each additional year of ownership increases the potential bill.
Mistake 5: Forgetting to update your own estate planning
An inheritance changes your overall assets. A French asset kept must be included in your will, significant capital must lead to a review of your asset allocation and beneficiary clauses. Assets that change without updated planning are assets at risk.
Mistake 6: Not consulting a notary or tax specialist
An heir in Paraguay, assets in France, Article 750 ter II lurking: the field is technical, and mistakes are costly—incorrectly calculated duties, missed deadlines, poorly managed joint ownership. A specialized consultation, costing between €500 and €3,000, easily pays for itself by the errors avoided.
Conclusion
Inheriting property in France as a Paraguayan resident is a perfectly manageable situation, provided the mechanics are respected. French law applies if the deceased resided in France, French inheritance taxes are due—€100,000 allowance per child then a scale from 5% to 45%—and the French notary leads the procedure, which you follow from Asunción via power of attorney.
Paraguay, for its part, imposes no inheritance tax: no double taxation. Repatriated funds are a capital transfer, not income, so no tax upon arrival. And once invested from Paraguay, whether foreign-source ETFs or local real estate, future gains are 0% or lightly taxed, versus over 30% if the same funds remained invested in France.
The roadmap for an heir settled in Paraguay is straightforward: pay French duties—it's an obligation, not a choice; sell real estate quickly to neutralize capital gains; repatriate liquid assets via SWIFT or Wise; invest funds from Paraguay; keep French life insurance from which you are a beneficiary. And exit joint ownership as quickly as possible, because managing it from Asunción is a headache to avoid.
An inheritance remains a significant event, involving the loss of a parent, memories, and the family home. Tax management is necessary, but it should not overshadow the essential. Take time to grieve, then manage the succession methodically, from your life in Paraguay, with a competent notary and a well-drafted power of attorney.
Are you inheriting property in France and living in Paraguay, or preparing to move? Contact our team: Paraguayan tax residency (from €1,400), US LLC creation, bank account, DNIT accounting services (€30/month). We can also direct you to the right professionals, notaries and tax specialists, to manage your inheritance remotely. Write to us on WhatsApp at +595 971 362 302: quick response, in French.