Saving for retirement is good. Saving for retirement with a tax boost is even better! To encourage the French to favor the PER, the government has provided for a tax advantage on entry. Indeed, the payments made on your contract can be deducted from your taxable income. The choice is however left to the saver and the exit tax will differ depending on the preferred option.
Thus, taxpayers who have opted for deductibility will be taxed once they retire when they recover their capital (progressive scale for payments and “flat tax” of 30% for earnings) while those who have waived this possibility will not. will be taxed only on winnings.
Taxable households in the highest brackets (from 30% and above) therefore find in the PER a good opportunity to save on the cheap. The amount to be paid into your envelope depends on several factors: your savings capacity, your retirement savings limit and the tax efficiency of each euro paid. Explanations.
Of course, in order to be able to pay money into a PER, you must first have a savings capacity. But most contracts being accessible with a few tens or hundreds of euros, it is possible to start with modest means. The best solution is to opt for scheduled payments: it is the guarantee of actually saving (without forgetting or postponing) and this makes it possible to smooth the savings effort as well as the entry into the stock markets. Nothing prevents you from setting up these payments with small amounts to start and from making an additional payment at the end of the year according to your budget balance.
For each taxpayer, the tax administration calculates each year the ceiling for deductible payments from their income.
But who says small amount, says small tax savings. To clear more of its slate with the tax authorities, you have to pay more. However, each taxpayer has a retirement savings limit, corresponding to 10% of their income net of expenses for the past year for employees – income taken into account within the limit of eight times the annual social security ceiling (PASS). At most, this makes it possible to deduct 32,909 euros. The minimum ceiling (for low incomes) is set at 10% of the PASS, or 4,114 euros this year.
Self-employed workers (liberal professions, craftsmen, traders) benefit from a specific, higher ceiling corresponding to 10% of their taxable profit for the current year, the latter being withheld within the limit of eight times the PASS. It is increased by 15% of the fraction of the profit between one and eight times the PASS. Or a maximum ceiling of 76,102 euros this year.
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