Assurance Vie - residents only
The first stop for those wanting to put money aside in a tax optimised way.
• An investment portfolio for stocks, bonds and money market funds
• During the first 4 years the “gain” is taxed at a maximum rate of 35%.
• Between 4 and 8 years, the “gain” is taxed at a maximum rate of 15%
• After 8 years, annual withdrawals are tax-free within limits
• Capital gains are still subject to social taxes (CSG, CRDS) at 15.5%

Careful, if you do not use an Assurance Vie investment vehicle, you will pay your top band rate income tax plus social charges on all gains.

Upon the policy owner’s death, the proceeds are distributed to the beneficiaries (after social taxes have been paid).
• Distributions to the spouse or PACS partner are exempt from inheritance tax
• Other beneficiaries have an assurance vie tax-free allowance of 152,500€ each

PERP Pension (Plan d’Epargne de Retraite Populaire) - residents only
Receive a direct deduction off your income tax bill of up to 10% of earned income received the year before.

The payments made into the PERP are locked until retirement and invested for growth based on the amount of risk the plan owner wants to take and the amount of growth targeted.

Upon retirement, the total amount invested is used to buy an annuity (regular income payment) which, according to the terms of the contract, can be fully passed on to the surviving spouse on death. There are different annuity options such as payment until the death of the plan owner or for a set amount of years.

The plan owner can receive a deduction straight off their annual tax bill for PERP funds invested of up to 10% of their annual revenues, net of social charges and professional fees. This is limited to 8 times the annual amount of the "sécurité sociale" ceiling, so a maximum deduction of €30,038 for 2014. The ceiling amount changes each year.

The circumstances under which money can be taken out of the PERP before retirement are limited. For example, if the plan owner becomes seriously ill or disabled and cannot work if their business activity is ceased due to a liquidation judgment. In some cases it is possible to recover some or all of the invested PERP funds in the case of divorce, or the death or incapacity of a spouse.

Request a consultation to see if these products are right for you :

France Home Finance is a fully licensed and insured insurance broker offering French life insurance, French home insurance and tax sheltered savings plans.