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Finance law implications The 2019 finance law broadened the notion of abuse of rights, with important implications. To fully understand the intricacies of this legal transformation, it is advisable to consult a lawyer in Nice who can provide you with detailed explanations .
Expansion of the concept of abuse of rights in the context of the 2019 finance law:-
In the past, abuse of rights only concerned transactions carried out for exclusively tax purposes. Essentially, if the sole purpose of a transaction was to minimize or evade taxes, it was subject to scrutiny.
However, the 2019 finance law extended the scope to operations mainly motivated by tax considerations. This distinction is of immense importance, particularly in cases of inheritance, such as donations. Even if the primary objective remains the transmission of the heritage to the descendants, the tax dimension must be recognized. For example, if a reserved usufruct is in place, upon the death of the usufructuary, the bare owner automatically assumes full ownership without incurring additional taxes.
Implications for inheritance and tax considerations: –
The tax administration aims to rationalize its control and prevent fictitious transfers intended to evade taxation. Their objective is not to impede the mechanisms of transmission of the heritage but rather to slow down the misappropriations and to fill certain gaps. Nevertheless, it is foreseeable that the administration could potentially abuse this new authority. Therefore, it is imperative to hire the services of a specialized lawyer in Nice to navigate this complex landscape.
As an illustration, consider a scenario where an individual transfers bare ownership of his property to his child shortly before his expected death, fully aware of his fragile health. Such a case would probably qualify as an abuse of rights, since the only intention would be to evade inheritance tax. The tax administration could potentially consider this donation as fictitious.
From then on, it becomes clear that the redefinition of this age-old notion in legal terminology aims to give the tax administration greater control and surveillance .