Choosing the right marital lifestyle is not just a question of love and feelings. It's also a question of finances. The differences between marriage, PACS and cohabitation can be substantial, especially when it comes to taxation. But make no mistake, this is not about choosing a regime to optimize your taxes! We're here to help you understand the financial consequences of these different choices. So, marriage, PACS or cohabitation, what impact will it have on your taxes and your assets?
The tax benefits of marriage
When we think of marriage, we often think of the beautiful ceremonythe white dress, the exchanging alliances. But marriage is also a legal system that offers a number of advantages, including tax benefits.
Indeed, the husband and wife are jointly taxed on their income, which can be favorable if one of the spouses has a lower income than the other. The calculation of family quotient takes family expenses into account, which can also be advantageous. What's more, married couples can also benefit from a reversionary pension in the event of the death of one of the spouses.
PACS and taxation: an advantageous solution
PACS, for Pacte Civil de Solidarité, is an alternative to marriage that is winning over more and more couples. Simpler and more flexible to set up, it also offers significant tax advantages for your couple.
Indeed, the PACIFIED PARTNERS are, like spouses, subject to joint taxation. This can be advantageous if one of the partners has a much higher income than the other. However, unlike marriage, PACS partners can opt for separate taxation in the first year of their partnership. This can be advantageous if one of the partners has received exceptional income that year.
The impact of cohabitation on your finances
Cohabitation, a form of cohabitation with no formalities or legal commitments, may seem attractive because of its simplicity. However, we mustn't forget that this simplicity comes at a cost, particularly in terms of taxation.
Indeed, the cohabitants are taxed separately. Each partner declares his or her own income, and therefore cannot benefit from the smoothing effect of the family quotient in the event of income disparity. What's more, cohabitation offers no protection in the event of death: no survivor's pension, no advantageous inheritance tax as in the case of marriage or PACS.
Inheritance and succession: which system to choose?
Beyond the simple question of taxes, the choice between marriage, PACS and cohabitation can have a significant impact on the tax system. significant impact on your assets and inheritance tax.
Marriage offers maximum protection for the surviving spouse when it comes to inheritance. Both spouses are entitled to full exemption from inheritance tax. In addition, the surviving spouse is entitled to usufruct of the entire estate, unless otherwise stipulated.
PACS partners also benefit from an exemption from inheritance tax, but their protection is less than in the case of marriage, especially if the deceased partner has children from a previous union.
Cohabitation offers no inheritance protection. The surviving cohabitee has no right to the deceased partner's estate.
Ultimately, there's no single answer to the question of whether to choose marriage, PACS or cohabitation. Each situation is unique and depends on the objectives and constraints of each couple. However, it is essential to fully understand the financial implications of each regime before making your choice. Because love is beautiful, but it's even better when you're clear about your finances!