Which taxman wants my boat when I pop my clogs?

[LostinFrance]

Any legal beagles out there that can tell me which country has dibs on my boat when I pop my clogs?
I am English but resident in France, my boat is under British Flag, part 1 registry - which I believe proves that the boat belongs to me. I don't have a purchase receipt as I built it myself, so I hope my assumption is correct.
The boat lives in La Rochelle.
I have already made a will in France and I'm just getting around to making one for what's left in my UK bank account when the thought occurred to me that although I pay a tax for owning a boat here to the French, I'm not sure if French law has any jurisdiction over a British vessel.
So would it be covered by a French or UK will?
I'd like to know because the inheritance taxes here are draconian and as the kids and the missus have ruled out a Viking funeral using their inheritance, I want to keep it out of M Macrons paws. Not that I've any intention of shuffling off this mortal coil yet that is.......

 

[Tranona]

The flag of registration is irrelevant in this context. If the registration is up to date then that is evidence of your title to the boat and forms part of your assets. When you die the boat becomes part of your estate and your executors will deal with it in accordance to your wishes as expressed in your will. Neither state (France or UK) has any direct claim over the boat. As you know inheritance and tax rules are different in France from England and you should take legal advice on making your will.

If you want a broad outline of how your executors should deal with the boat there is a good summary in the legal advice section on the RYA site.

PS even if you instruct your family to burn your boat it will still have a value for probate as part of your estate and therefore there may be tax to pay on that value.

 

[Biggles Wader]

Inheritance tax is best avoided by not having enough inheritance to pay tax on. Have you considered passing title of the boat on to your family sooner rather than later.

 

[macd]

Have you considered passing title of the boat on to your family sooner rather than later.

Wouldn't that erode the fun of spending the kids' inheritance?

More seriously, this is well worth a chat with a lawyer, as suggested. Afraid I don't know the score for the OP, resident in France, but certainly for a UK national in Italy it's possible to specify which country's laws apply. (That's both tax and inheritance laws, which aren't the same thing.) But, since it's under EU rules, I daresay it's similar.
This is the relevant blurb from my will, drawn up in Rome:
"Being a British national most closely connected with the law of England and Wales, I hereby ELECT, pursuant to Art. 22 of EU Regulation no. 650/2012 that my Will, together with all matters relevant to my succession, shall be construed and take effect in accordance with English law."

P.S. Usual caveat about bleedin' Brexit, etc.

 

[Fr J Hackett]

If you are a French resident and pay taxes in France then you will be covered by French inheritance law.

 

[Angele]

I think the answer to the OP's question is probably "both", but that requires a bit of further expansion.

I assume you are and remain UK domicile (“domicile of origin”) - the answer will be different if you are not - in which case UK inheritance tax is payable (to the extent the individual threshold is exceeded) on your worldwide assets. In addition, the French equivalent of inheritance tax (droits de succession) apply to all assets located in France if the deceased is resident there, even if you aren’t a citizen of France.

The good news is, however, that the double taxation treaty between the UK and France includes inheritance tax, so your estate and/or beneficiaries would not be hit twice, and transfers to a surviving spouse are exempt from the tax in both countries.

Sybarite may have some useful info to impart on this topic. Meanwhile, here are a couple of useful websites:

https://www.blevinsfranks.com/news/blevinsfranks/article/inheritance-tax-and-domicile

https://axis-finance.com/tax/french-inheritance-tax/

I'm surprised to hear you describe French inheritance tax rates as draconian. You have to be very wealthy for the tax rate payable on legacies to your children to be higher than that applicable in the UK, although the UK's nil rate band is potentially more generous if you have fewer than 3 children.

Edit: As Tranona says, I'm pretty sure that the Part 1 registration is a red herring if the boat is located in France.

 

[macd]

If you are a French resident and pay taxes in France then you will be covered by French inheritance law.

Written with conviction. But perhaps not with knowledge of Art. 22 of EU Regulation no. 650/2012?

 

[DownWest]

Not sure about a boat, but houses def get hit if you try to leave it to someone other than the wife and kids. Local lady, UK citizen, without blood relatives, left her place to friends. State wanted 60+% off the top.
If leaving it to the wife & kids, some tax to pay, but they could sail it to UK before things got tricky??

You built it yourself and it is steel? So that rules out a decent Viking send off Why not gift it to a wife or child, so you are just the user? And hope you outlive any time restriction on gifts.
Given the above, how old is it and how much is it worth?
There was a recent thread about a boat in S. Spain that the children wanted rid of after their father died on it. No comment about any tax interest from the Spanish, who have similar laws