The Content Of The Article:

Dismemberment is a legal act that applies to property rights. It dissociates the right of enjoyment (usufruct) and the right of disposal (bare ownership). What are its principles and what tax benefits allows the dismemberment of property? The answer elements in this article.

Dismemberment of a property

Dismemberment of a property

Dismemberment of a property, what is it?

The dismemberment of property allows to divide the full property a property in two parts, namely:

1. usufruct, or the right to use and collect the fruits of the good (own use, rental).
2. the bare ownership, or the right to dispose of the property within the limits of the rights of the usufructuary.

Although totally independent of each other, the usufructuary and the bare owner can not individually decide to sell the dismembered real estate. Indeed, the two parties must agree on this transfer to implement it.

The death of the usufructuary puts an end to the dismemberment of the good and the bare owner then becomes sole owner. This is called "land consolidation".

The new owner can thus:

  • to occupy the good,
  • choose to rent it,
  • sell it…

To noteIn the event that the bare owner dies first, his right to bare ownership is transmitted to his heirs and thus enters his estate.

Succession: What are the advantages of dismembering property?

The process of the dismemberment of property is today frequently used during the succession.

Indeed, it is possible to reduce the weight of inheritance subject to inheritance tax through the dismembered donation. In this way, the usufructuary retains the enjoyment of the property while limiting future transmission costs:

  • the donation with reserve of usufruct can be taxed only once by the tax services.
  • on the death of the donor (the usufructuary), the reconstitution of full ownership does not entail new fees and the bare owner must not pay any additional fees.

Most common diagram of the dismembered donation:

Deceased spouse Surviving spouse Heir (s)
Donation or bequest of the usufruct of his property to the surviving spouse.UsufructuaryBare owner (s)

To note: donation is not the only way to pass on usufruct and bare ownership rights, since it is also possible to sell them. This is called the assignment of rights.

Video Instruction: Dismemberment Plan Time Bomb