Joint ownership more or less reduces the taxable value

A simple joint ownership, between a mother and her only son, does not present any difficulty in management, estimated the Court of Cassation, and the tax abatement usually allowed, of 20%, can be reduced to 5%.

In principle, the total of the undivided shares on a property does not have the value of the property itself because the joint possession creates an obstacle to the sale, which reduces the value of the shares.

Each co-owner cannot sell as he sees fit, it is difficult to find a buyer for joint ownership shares and, to sell everything, all the owners must agree at the same time.

The Court of Cassation therefore accepted that a reduction, generally 20%, be applied to the value of the shares of each co-owner. But in March 2019, the Court ruled that an undivided building between two spouses separated from property did not suffer a loss in value. It is a matrimonial regime chosen by them as a way of managing their assets and it is unlikely, in the event of a sale, that they will not sell their shares simultaneously, she said.

This time, it validates the position of the tax administration for which the joint ownership between a mother and her son does not cause particular constraints justifying a strong abatement. It rejects the request of these owners who wanted to examine the possible management difficulties and the obstacles to the sale created by this situation.

(Cass. Com, 30.9.2020, Q 18-15.748).