Assurance-vie: tax brackets or flat-rate tax, and exemption from withholding tax

For premiums paid since September 27, 2017, assurance-vie redemptions are taxed by default at a flat rate of 12.8% (%), or 7.5% (%) for contracts of 8 years or more (premiums under €150,000). You can opt for the progressive income tax scale when filing your tax return. With a rate of 7.5% (%), the tax is lower if the income added to your earnings is subject to an average rate lower than 7.5% (%). The withholding tax levied by the insurer is not final: an exemption is possible if your reference tax income is less than €25,000 (€50,000 for a couple), which must be requested no later than November 30 of the year preceding the payment.

This page deals with premiums paid since September 27, 2017, for a French tax resident. It does not cover premiums paid before this date, the situation of a non-resident, or the social security contribution rate, which are addressed on dedicated pages. On this page, "PFU" refers to the flat-rate levy of 12.8% or 7.5% on earnings, excluding social security contributions. It is also referred to as the "flat rate.".

What we are comparing

We are comparing income tax, not social security contributions. The option for the progressive tax scale applies to income tax. Assurance-vie gains are subject to social security contributions (service-public.gouv.fr, fact sheet F22414), and the annual allowance does not reduce their taxable base (BOFiP). These contributions, and their treatment when opting for the progressive tax scale, are not calculated here; they are covered on a dedicated page.

The flat-rate system applies if the option for the scale is not chosen. The triggering event is the partial redemption or termination of the contract.

The €150,000 threshold applies to all your contracts, based on premiums not reimbursed as a lump sum as of December 31st of the year preceding the triggering event. The BOFiP (BOI-RPPM-RCM-20-15, paragraph 170) specifies that it is assessed per beneficiary: it is a personal threshold, so premiums paid on your spouse's contracts are not added to yours. Cases of joint subscription, split ownership, or contracts acquired free of charge or for consideration are subject to specific rules, which should be verified in this document. The calculation of the non-taxable portion of 7.5 % is not detailed here.

The discount plays with both options

For contracts of 8 years or more, an annual allowance of €4,600 (single person) or €9,200 (married or civil union couple filing jointly) applies to gains. This allowance is a single allowance for all your contracts and cannot be carried over. It is reserved for taxpayers who are tax residents of France.

According to impots.gouv.fr, it applies "regardless of the tax regime." In the comparison below, the allowance therefore reduces the tax base in both cases. It does not differentiate between the two options.

The option for the pricing scale

For contracts of less than 8 years, as well as for contracts of 8 years or more, you can be taxed according to the progressive income tax scale by selecting this option when filing your tax return (form F22414). If the tax withheld exceeds the tax due, the excess will be refunded to you.

Three points to clarify:

• The option is global. The BOFiP (version of 21/06/2021) adds that it is annual and applies to all income and investment gains. Therefore, choosing the tax bracket for assurance-vie is not a decision to be made alone.
• It is reflected on the 2042 tax return. The box is checked on the form for the year.
• Can one change their mind? According to the BOFiP (version of 21/06/2021, paragraph 320), the option is irrevocable, but the taxpayer can modify it as long as the filing deadline for the tax return has not passed. The practical guide to income tax for 2026, under the heading "Income 2026 & subsequent years" (Finance Law for 2026, Article 126), indicates that the irrevocable nature of the option has been removed. The BOFiP cited dates from 2021. For income in the year of your redemption, check the applicable rule before checking the box.

The comparison threshold

The additional income tax on top of the standard tax brackets is the tax your earnings add to your tax liability. Dividing this by the tax base gives an average rate. The tax brackets are lower when this average rate is less than the standard rate.

The 2026 tax brackets (based on 2025 income, for a single share) include a bracket of 0 (%) up to €11,600, then 11 (%) up to €29,579, 30 (%) up to €84,577, 41 (%) up to €181,917, and 45 (%) above that (service-public.gouv.fr, fact sheet F1419, verified on 04/15/2026). These brackets are set by the 2026 Finance Law: refer to the tax brackets for the year of your buyback.

This table isolates income tax. It does not replace a simulation on your specific case.

Exemption from the levy

The withholding tax of 12.8% or 7.5% is deducted by the institution when the winnings are paid out. It applies to proceeds from premiums paid on or after September 27, 2017. It is not a final tax: it is credited against the income tax due, and any excess is refunded.

You can request an exemption if your reference tax income (RFR) for the year before last is less than:

• €25,000 for a single person; ;
• €50,000 for a couple subject to joint taxation.

For income received in 2026, the relevant reference tax income (RFR) is that of 2024. The application takes the form of a sworn statement indicating that your RFR is below the threshold. This can be done on plain paper, including your name and address.

Deadline. According to the BOFiP (BOI-RPPM-RCM-30-20-10, paragraph 55), the application must be submitted no later than November 30th of the year preceding the year in which the income is paid. Fact sheet F22414 on service-public.gouv.fr mentions the same deadline of November 30th. For a payment in 2027, the deadline is therefore November 30, 2026. For a payment in 2026, this date (November 30, 2025) has already passed. The BOFiP provides for exceptions for certain products: ask your insurer for the applicable date for your contract before making the payment.

The exemption applies to the withholding tax levied when the winnings are paid out. The winnings are then taxed on the tax return, either at a flat rate or according to the applicable tax scale.

Numerical example (fictitious profile)

Situation. Hélène, single, with one tax unit, a French tax resident, took out a assurance-vie policy in October 2017 and has paid premiums into it since then, totaling €90,000, which remains unpaid as of December 31, 2024. In December 2025, a partial withdrawal yields €20,000 in proceeds. The policy is over 8 years old. Hélène has no other policies. Her reference tax income (RFR) for the year before last (N-2) is less than €25,000. Assumptions in this example: the portion of the withdrawal that yields gains has already been calculated, and the tax brackets used are those for 2026 for one tax unit, without any discount or other reporting requirements. The discount, which can apply to a tax liability of this level, can alter the differences in the first two scenarios; it is not included here.

Issue. Should you opt for the tax scale? It depends on the rest of your income: three situations are compared.

Strategy. Apply the €4,600 allowance, resulting in a base of €15,400. Compare the flat rate of 7.5% (%) with the additional tax calculated according to the tax brackets. Social security contributions are disregarded.

Result.

In the first case, €11,600 of the base remains in the 0% tax bracket (%) and €3,800 is taxed at 11% (%). In the second case, €3,600 remains in the 0% tax bracket (%) and €11,800 is taxed at 11% (%). In the third case, the entire base is taxed at 30% (%).

The 7.5 % withholding tax levied by the insurer is deducted from the tax due, and any excess is refunded. If an exemption is requested within the specified timeframe, the withholding tax is not applied at the time of payment.

This profile is fictitious. The income figures are hypothetical. The numbers illustrate the calculation. They do not reflect your actual situation.

What changes depending on your situation

• The seniority of the contract : 8 years or more or less than 8 years (7.5 % or 12.8 %, discount or not).
• Your total bonuses across all your contracts: it conditions the rate of 7.5 %.
• The rest of your income, which determines the average rate of the scale.
• Other capital income : the option is global.
• Your RFR for the second-to-last year : it is a condition for exemption.
• The date of your bonuses : those prior to September 27, 2017 fall under a different regime.
• Your tax residence : the page is aimed at tax residents of France.
• The elements of your declaration, including the discount and social security contributions, which are not included in the example.

The rule depends on your situation. No results are guaranteed.