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What Is Présent D'usage?

Présent d'usage refers to the customary gift-giving or gesture of hospitality in French culture. It is a traditional practice where individuals or businesses offer gifts or tokens of appreciation on specific occasions (such as birthdays, Christmas, and weddings) or in certain social or professional settings.  While it is deeply embedded in French customs and etiquette, it is important to understand the legal and tax implications associated with présent d'usage to ensure compliance with relevant laws and regulations.

The legal framework for présent d'usage

The legal framework surrounding présent d'usage in France is rooted in general contract law and principles outlined in the French civil code. One essential concept to understand is the notion of gratuitousness, which means that gifts exchanged as présent d'usage are given without any expectation of receiving something in return.

Distinguishing a gift from a transaction

In other words, they are voluntary and not motivated by a contractual obligation. Unlike commercial transactions that involve consideration, présent d'usage is characterised by the absence of consideration. Consideration refers to the exchange of something of value between parties, which is a fundamental element of a binding contract. In the case of présent d'usage, the gifts or gestures are offered as acts of kindness, hospitality, or goodwill rather than as part of a contractual agreement. The absence of consideration distinguishes présent d'usage from commercial transactions, reinforcing its voluntary nature and emphasising the social or personal aspect of the gesture.

Other requirements of présent d'usage

Présent d'usage must be connected to an occasion or event. It may be a birthday gift, a wedding present, or even a celebration of a milestone such as graduating. Furthermore, the gift must be proportionate to the donor's wealth. It is important to adhere to this guidance. Donations which do not may not be classified as présent d'usage and, therefore, will be subject to different (and higher) taxation.

French gift tax (droits de donation)

Droits de donation, commonly referred to as "gift tax" in France, is a tax levied on the transfer of property or assets by an individual to another person or entity as a gift. It is applicable when the transfer is made without any consideration or payment in return.

How much is French gift tax?

The amount of gift tax depends on various factors, such as the relationship between the donor and the recipient, the value of the gift, and any applicable tax exemptions or allowances. Different thresholds apply based on the relationship between the parties, with more favourable thresholds offered for close family members. Gifts under the threshold amount are not subject to gift tax.

The purpose of droits de donation

Droits de donation is designed to ensure that transfers of wealth through gifts are subject to taxation, preventing individuals from avoiding inheritance taxes by distributing their assets as gifts during their lifetime.

Do you need to report a présent d'usage?

Depending on the nature and value of the gifts exchanged, there may be reporting obligations for présent d'usage transactions. Tax authorities may require disclosure of gifts above certain thresholds or in specific circumstances. It is advisable to consult French tax law professionals to determine the reporting requirements and ensure compliance with applicable regulations.

Expert France tax advice

For expert guidance from experienced French tax specialists, speak with the France Tax Law team. Our dedicated team works on cross-border matters factoring in both French and UK law to help you to optimise your taxes and meet your obligations. We are a team of French law professionals with experience across French property, business, and inheritance law. So we can provide comprehensive tax advice for all your needs. Speak with our French-qualified notaire to learn more.

Learn more about taxes in France

If you want to learn more about French taxes, we have many insightful guides on the topic. Here are a few recommended reads: 

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