Inheritance Tax in Fribourg: Definition
According toart. 1 of the law on inheritances and donations (LISD), the canton of Fribourg levies a tax on any transfer of assets to a third party, after a person's death.
The municipalities of the canton are also authorised to tax an inheritance. Whether cantonal or communal, the tax applies to any property transferred by legal or voluntary succession.
The tax is levied by the canton of Fribourg, provided that the donor was living there at the time of their passing.
Movable and Immovable Property
The assets concerned can be both movable (works of art) and immovable (house, apartments). The testator's debts are also subtracted.
Examples of immovable property
Examples of movable property
Houses
Works of art
Flats
Jewellery
Farmland
Company shares
Commercial premises
A stock portfolio
Who is Affected by this Tax?
This tax applies to anyone who benefits from a transfer of property. The following people will have to pay inheritance tax:
- The heirs
- The legatees
It is important to distinguish between an heir and a legatee. In both cases, there may be a will, which bequeaths the deceased's assets to specific people.
Heirs
For example, if Sébastien dies without leaving a will, his close family members will divide his assets between themselves, by law. The latter are thus considered heirs.
Legatees
Bequeathers are people who receive a donation through a testament. In other words, they must be named in the will to receive a deceased's assets.
Joint Liability
In the canton of FribourgUnder the law, heirs are ‘jointly liable’ for the payment of inheritance tax. If one of the heirs fails to pay his or her share of the tax, the other heirs may be required to do so.
The heirs are collectively responsible for paying the tax, but they will never have to pay more than the amount they inherited.
Inheritance Tax Rates in the Canton of Fribourg
In Fribourg, the tax rate depends on the degree of kinship of an heir or legatee. The closera person is to the donor in terms of familial bonds, the less tax they will pay.
Degree of kinship
Corresponding rate
Brothers and sisters
5,25%
Nephews and nieces
8,25%
Great-nephews and great-nieces
10,50%
Descendants of grand-nephews and grand-nieces
12,75%
Cousins
12,75%
Cousins' descendants
17,25%
People living in the same household for at least 10 years
8,25%
Other beneficiaries
22%
Municipal inheritance tax amount depends on the municipality and will be at most 70% of cantonal tax.
Exemptions
Several people are exempted of inheritance tax in the canton of Fribourg. Spouses and registered partners are not subject to inheritance tax.
Direct relatives such as fathers, mothers or grandparents are also exempt.
In addition, each heir or legatee can benefit from a tax deduction of 5’000 CHF. However, they can only receive one every 5 years.
How do you Calculate Inheritance Tax in Fribourg?
When calculating inheritance tax in Fribourg, a number of factors need to be taken into account, such as cantonal and municipal tax, family relationship and any deductions.
For example, if an uncle dies and wishes to transfer an asset worth CHF 100,000 to his nephew, the tax rate will first have to be applied, which is 8.25% in the Fribourg canton.
The nephew will also be entitled to a deduction of 5’000 CHF, provided that the nephew has not already received an inheritance tax deduction in previous years.
Example of Cantonal Tax Calculation
This gives us the following calculation:
Taxable amount CHF 100,000 (bequeathed amount) - CHF 5,000 (deduction) = 95’000 CHF.
Tax calculation : 95’000 CHF × 8.25% = 7’837.50 CHF.
Net amount received by nephew : 100’000 CHF – 7’837.50 CHF = 92’162.50 CHF.
In short, the nephew will receive 92’162.50 CHF after he paid inheritance tax of 7’837.50 CHF, so long as his municipality does not also levy inheritance tax.
Example of Municipal Tax Calculation
To calculate the municipal tax, we need to take the cantonal tax. In our example, the cantonal tax for Fribourg is 7’837.50 CHF.
Given that a municipality can levy a maximum of 70% of cantonal tax, the following calculation can be made:
Maximum amount of additional centimes : 7’837.50 CHF × 70% = 5’486.25 CHF
Maximum total tax :
Cantonal Tax + Additional Centimes = CHF 7,837.50 + CHF 5,486.25 = 13’323.75 CHF
Net amount the nephew would receive: 100’000 CHF – 13’323.75 CHF = 86’676.25 CHF que recevrait le neveu :
100’000 CHF – 13’323.75 CHF = 86’676.25 CHF
Frequently Asked Questions
What is inheritance tax in Fribourg?
In the canton of Fribourg, inheritance tax is levied on assets received by heirs or legatees after the death of the donor. According to art. 1 of the Inheritance and Gift Tax Act (LISD), this tax is payable when assets are transferred to a third party following a death.
What assets are subject to inheritance tax in Fribourg?
Assets subject to inheritance tax in Fribourg may be movable assets (works of art, jewellery, company shares, share portfolios) or real estate properties (houses, flats, farmland, business premises). The donor's debts are also deducted when calculating tax.
Who has to pay inheritance tax in Fribourg?
The following persons are liable for inheritance tax:
- The heirs : ceux qui héritent des biens selon les règles légales en l’absence de testament.
- The legatees those who receive property specifically designated in a will.
What is the difference between an heir and a legatee in Fribourg?
An heir is a person who who inherits the deceased's property under the law, in the absence of a will. A legatee is a person specifically named in a will to receive a particular asset.
