Are you retiring, but do not immediately need to unblock your Retirement Savings Plan? You don’t have to. You can even continue to deduct your payments to reduce your income tax for several years.
Question from Pierre-Paul, in December 2021
I just read that there would be an age limit to benefit from the tax reduction with a PER, which would be calculated as follows, from the life expectancy of 86 years: 86 – 15
No, this is not quite correct. The rule you are referring to, Pierre-Paul, is the one that applies to Perp, a product now closed for sale, for the benefit of the Retirement Savings Plan (PER). For the Perp, an age limit is effectively calculated on the basis of the life expectancy of the holder, subtracting 15 years. It acts as the subscription deadline, and as the settlement deadline. By extension, it also limits the benefit of the tax deduction.
And for the PER? There is no automatic unwinding, answers Mlanie Benayoun, consultant at Fidroit. Therefore, no age limit, neither for the subscription, nor for the unwinding, nor to take advantage of the tax deduction: This is not indicated in the law, developed Mlanie Benayoun, nor in the Monetary and Financial Code, nor in the Bofip-Impts [bulletin rassemblant toute la documentation fiscale, NDLR]. In the regulatory texts, the deadline you mention, 15 years before the holder’s life expectancy, therefore does not exist for the PER.
But this lack of regulatory limit does not exclude the existence of a contractual limit, set by the insurer or manager of the plan. However, most often, insurers have entered a subscription deadline in the contract, or indicated a deadline for payment in capital, or a deadline for conversion into an annuity. Clearly, since the regulations governing the PER are very flexible, it is the insurers who set their own safeguards themselves.
Retirement : save by paying less taxes. 11 comparison contracts
Young withdrawals: should we continue to pay into the PER?
It is therefore possible to continue paying into your PER, even after having largely passed retirement age. And you are free to move back as far as possible the moment you start withdrawing the capital, or transforming the savings into an annuity, according to the limits set by the insurer of course.
But is it really interesting for a young retiree to continue paying into a PER in order to deduct these payments from taxable income? Why not, replies Mlanie Benayoun, from Fidroit: If you have a TMI [tranche marginale d’imposition, soit le taux qui s’applique la partie haute de vos revenus, NDLR] 30% or 41%, even after you retire, it can be interesting.
There remains a major limit: the absence of activity income, retirement, which in fact reduces the amount deductible each year, since the personalized ceiling corresponds to 10% of the taxpayer’s activity income. In the absence of professional income, the minimum annual ceiling applies, ie 4052 euros for 2021 and 2022. Any doubt? This limit appears on your tax notice, or can be claimed by secure messaging on impots.gouv.fr, or even at the public finance center closest to you.
Savings: how to reduce your taxes with the PER
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