In summary…
The two, in this order: the PER (retirement savings plan) up to the deduction limit, then life insurance for the rest. In the typical case (payment of €10,000 per year for 20 years, return of 3.% per year, calculation assumption), each year the PER saves €4,100 tax (marginal tax bracket of 41 %). Withdrawn at age 67 over 10 years, the portion of contributions deducted is taxed at 30% instead of 41 %, this represents €22,000 less tax than if the bracket remained at 41 %. With the same effort of €10,000 per year, the combination of a PER followed by life insurance leaves €292,454 net after tax, against €255,009 for life insurance alone, that is €37,445 more. The French National Bar Association Pension Fund (CNBF) only pays out 44% of the income here: the PER (Retirement Savings Plan) does not replace the fund, it supplements part of it. Life insurance retains its role: it remains accessible, and its gains are taxed at 7.5% after 8 years (under €150,000 in premiums), after an annual allowance of €4,600.
1. What the PER does, step by step
The PER (retirement savings plan) is tax-deductible upon contribution and taxable upon withdrawal. Life insurance works in the opposite way: no tax advantage upon contribution, and reduced taxation on gains upon withdrawal. The entire comparison hinges on the difference between the tax bracket upon contribution and the tax bracket upon withdrawal. The pension amount in this typical case comes from our article on lawyer retirement at the CNBF (National Bar Association Pension Fund).
| Step | Rule in 2026 |
|---|---|
| Entry: tax saving | Voluntary contributions are deducted from taxable income, unless the taxpayer opts for non-deduction. The savings are equal to the contribution multiplied by the marginal tax bracket: at 41 %, €0.41 per euro paid, at 30 %, €0.30. The 2026 scale applies 41 % from €84,578 to €181,917 of income per share, and 30 % from €29,580 to €84,577 (law no. 2026-103, article 4). |
| Entry: ceiling for a self-employed worker | The higher of two amounts: 10 % of the previous year's profit (withheld up to 8 times the annual social security ceiling) or 10 % of this ceiling, This amounts to a minimum of €4,710 for a payment in 2026. Occupational pension contributions already deducted from the previous year's profit are reduced, except for a portion equal to 15 % of the profit between 1 and 8 times the ceiling. Any unused ceiling can be carried forward to the following five years. |
| Capital withdrawal: contributions deducted | The portion corresponding to the deducted payments is added to other income and is taxed according to the scale, without social security contributions and without the 10 % reduction pensions. She is eligible for the income averaging mechanism for exceptional income. |
| Capital withdrawal: gains | Single flat-rate levy of 31.4% For interest received since January 1, 2026: 12.8% tax and 18.6% social security contributions. The option to apply the standard tax scale remains available. |
| Lump-sum withdrawal: contributions not deducted | If the payment was not deducted, the corresponding portion of capital is exempt from income tax and social security contributions. Only the gains are taxed (31.4 %). |
| Annuity payout: payments deducted | The annuity is taxed as a retirement pension, with a 10% allowance (capped at €4,439 per household for 2025 income). Social security contributions of 18.6% are levied on a portion of the annuity that depends on the age at the first payment: 70% before age 50, 50% from age 50 to 59., 40 % aged 60 to 69, 30 % from age 70. |
| Annuity payout: payments not deducted | The annuity falls under the regime of life annuities for valuable consideration: only a fraction is taxable (70 %, 50 %, 40 % or 30 % depending on the age at the first payment), and social security contributions of 18.6 % apply to it. |
| Withdrawal before retirement | Possible in cases of early release as provided for in Article L. 224-4 of the Monetary and Financial Code. |
Our page Individual PER details how the contract works, and the article on the deduction ceiling and the 2026 finance law details the calculation of the ceiling.
2. What life insurance does after 8 years
| Point | Rule in 2026 |
|---|---|
| Contract of less than 8 years | Gains taxed at 12.8 % (or at the scale by option), without allowance. |
| Contract of 8 years or more: discount | The redeemed gains benefit from an annual allowance of €4,600 for a single person, €9,200 for a couple subject to joint taxation. It is a single agreement for all contracts within the household, does not carry over from one year to the next, and does not affect social security contributions. |
| Contract of 8 years or more: rate | After the initial shock, 7.5% as long as the total of premiums paid and not reimbursed as capital, across all contracts, does not exceed €150,000 as of December 31 of the previous year. Beyond that date, the 7.5% % rate applies only to the portion of earnings equal to €150,000 (less premiums paid before September 27, 2017, that have not been reimbursed) divided by the premiums paid since that date that have not been reimbursed; the remainder is taxed at 12.8% %. The allowance is first applied to the portion taxed at 7.5% %. |
| Social charges | 17.2% on the gains (principle rate). |
| Partial buyout | Only the portion of gains contained in the redemption is taxed: redemption less premiums paid multiplied by redemption divided by the value of the contract. |
| Scale option | Possible, explicitly, comprehensively, and irrevocably. The calculation below does not include it. |
3. Calculation based on a lawyer at 41 %
| Calculation assumption | Value retained |
|---|---|
| Lawyer | 47 years old, single (1 share), taxable income of €100,000 before payment: marginal tax bracket at 41 %, and income remains above €84,577 after deduction (€90,000) |
| Payments | €10,000 per year on the PER for 20 years, from age 47 to 67, within the deduction limit (10% of a profit of €100,000), without any other occupational retirement contract deducted from the profit |
| Yield | 3 % per year, net of fees, identical for the PER and for life insurance (calculation assumption), payments at the end of the year |
| Tax saving | Calculated in the year of payment, without delay; it amounts to €4,100 per year (2026 scale, calculated before and after deduction) |
| Scale and rates | The 2026 tax brackets and social security contribution rates remain unchanged until retirement; calculation is based solely on the tax brackets, without any discounts or tax reductions. |
| Retirement at 67 | Pension of €44,100 per year (CNBF estimate at age 67 for a 35-year career with €100,000 in earnings, basic and supplementary pension schemes combined, see our article on lawyers' retirement), with no other income; 10% tax allowance of €4,410, resulting in €39,690 taxable income and €5,011 tax before any withdrawal from the PER (Retirement Savings Plan). |
| Capital exit | 10 equal annual withdrawals from age 67 to 76, with no return after age 67 (simplifying assumption that isolates the effect of tax); the income-averaging mechanism is not modeled. |
| Annuity payout | Conversion rate of 4 % of capital at age 67 (calculation assumption) |
| Assurance-vie | Contract of more than 8 years, no other contract in the household, 10 equal annual redemptions from age 67 to 76, social security contributions of 17.2% on gains, rates of 7.5% and 12.8% spread each year according to the remaining premiums |
Typical case
Situation. A 47-year-old lawyer, practicing as a sole practitioner, single, has €100,000 of taxable profit and €10,000 per year to put aside for his retirement until age 67.
Issue. He is hesitating between the PER (Retirement Savings Plan), which reduces his taxes immediately, and life insurance, which remains accessible and whose gains are taxed at a low rate after 8 years. Every euro paid into the PER will be taxed again upon withdrawal: the advantage only exists if the withdrawal tax bracket is lower than the contribution bracket.
Strategy. He compares four investment strategies. Strategy 1: €10,000 per year in life insurance. Strategy 2: €10,000 per year in a retirement savings plan (PER), of which €4,100 is tax-deductible, resulting in a net cost of €5,900. Strategy 3: this €5,900 invested in life insurance. Strategy 4: €10,000 per year in a PER, with the €4,100 tax-deductible investment in life insurance, resulting in a net cost of €10,000, the same as Strategy 1. At age 67, he withdraws the capital from the PER over 10 years.
Result. Assembly 4 leaves €292,454 net after tax, versus €255,009 for assembly 1, i.e. €37,445 more with the same effort. The PER alone leaves €187,131 for €5,900 of effort per year, compared to €151,563 for the same amount in life insurance.
Capital at age 67 and exit tax
| Assembly | Net effort per year | Capital at 67 years old | including earnings | Tax and charges on exit | Net after tax |
|---|---|---|---|---|---|
| 1. Life insurance alone | €10,000 | €268,704 | €68,704 | €13,694 | €255,009 |
| 2. PER alone | €5,900 | €268,704 | €68,704 | €81,573 | €187,131 |
| 3. Life insurance alone, same effort as the PER | €5,900 | €158,535 | €40,535 | €6,972 | €151,563 |
| 4. PER, then tax savings through life insurance | €10,000 | €378,872 | €96,872 | €86,418 | €292,454 |
Details of the PER lump sum withdrawal
| Item | Base | Rate | Amount |
|---|---|---|---|
| Payments deducted and withdrawn (scale) | €200,000 | 30 % (retirement bracket) | €60,000 |
| Withdrawals (single flat-rate deduction) | €68,704 | 31.4% | €21,573 |
| Total at exit | €268,704 | 30.4 % of the capital | €81,573 |
Each year of withdrawal adds €20,000 in deducted contributions to the €39,690 of taxable pension income. The total (€59,690) remains below €84,577: the entire portion is taxed at 30% of the % tax bracket. The 30% bracket leaves €44,887 of taxable income each year before reaching €41%, so €20,000 only uses up €45% of that taxable income. Withdrawn in a single year, the same €200,000 portion would incur €79,373 in tax instead of €60,000, not including the income averaging factor, which we have not modeled. Spreading the output is the first lever of the PER.
What if the pension bracket doesn't decrease at retirement?
The lawyer who retains €90,000 of taxable income per year in retirement (rent, consulting work) remains at 41% of the tax bracket upon withdrawal. The tax on deducted contributions then rises to €82,000, exactly the savings achieved upon entry, and the PER alone leaves €165,131 compared to €151,563 for life insurance with the same effort, a difference of €13,568. The advantage remains, but it is reduced: it no longer stems from the difference in tax brackets, but solely from the fact that the tax savings of 41% increase the invested capital over 20 years, with gains taxed at 31%. At a difference of €35,568 versus €13,568, The reduction in the retirement bracket costs approximately €22,000. in the result.
Capital or annuity
| Exit | Gross amount | Taxes and levies | Detail | Portion retained |
|---|---|---|---|---|
| Capital spread over 10 years | €268,704 | €81,573 | €60,000 according to the tax brackets on deducted payments, €21,573 flat-rate levy on gains | 69.6% |
| Annuity at 4 % of the capital | €10,748 per year | €4,015 per year | €3,216 in income tax and €800 in social security contributions (18.6 % out of 40 % of the annuity) | 62.6% |
The annuity is added to the €44,100 pension. It remains in the 30% tax bracket and benefits from the 10% allowance, already capped at €4,439: the additional allowance is €29. It is subject to social security contributions on 40% of its amount, which are not levied on contributions withdrawn as a lump sum. The lump sum therefore retains a larger share of each euro withdrawn (69.6% compared to 62.6%); the annuity provides a lifetime income, which is not subject to any withdrawal rules.
What the €150,000 threshold costs in life insurance
Scheme 1 pays out €200,000 in premiums, above the €150,000 threshold: during the first few years of redemption, a portion of the gains increases to 12.8%. The additional cost of this effect alone is €174 in income tax on the entire withdrawal. This is low because the €4,600 allowance absorbs most of the gains from each redemption. In Scheme 4, the life insurance policy receives only €82,000 in premiums: it remains below the threshold, and its gains of €2,817 per year remain below the allowance. without income tax. Only the social security contributions of 17.2 % (€4,845) remain due.
4. The combination for an avocado whose slice is falling
- The PER first, up to the ceiling. Each euro deducted results in an average tax saving of 41 % (€4,100 for €10,000). The 10 % profit threshold is the starting point: €10,000 for a profit of €100,000.
- The tax savings go into life insurance. The €4,100 collected each year is invested in a contract that remains accessible. With €82,000 in premiums over 20 years, it remains below the €150,000 threshold.
- The capital from the PER is withdrawn over several years. The 30% tax bracket (%) leaves €44,887 per year of leeway with €39,690 in taxable pensions. Ten withdrawals of €20,000 each consume less than half of this.
- Life insurance is redeemed after 8 years, in small installments. A redemption that contains less than €4,600 in gains (€9,200 for a couple) is not subject to income tax.
- The annuity is a supplement, for the portion from which the lawyer wants a lifetime income. It retains the 30 % tranche, with social security contributions on a fraction.
Beyond the limits of the PER (Retirement Savings Plan) and life insurance, real estate takes over: see our pages SCPI and LMNP. The other levers are gathered on the page tax exemption.
Frequently asked questions
Is a PER (Retirement Savings Plan) still better than life insurance for a lawyer earning 41,130?
From a tax perspective, yes, as long as the withdrawal bracket is not higher than the contribution bracket: in a typical case, the PER (Retirement Savings Plan) yields €187,131 compared to €151,563 for the same contribution level. It does have one drawback: the savings are locked until retirement, except in cases of early withdrawal provided for by law. Life insurance therefore remains the available reserve, and the combination of the two accounts provides a balance between the two.
At what premium level does the 7.5 % rate of life insurance stop?
When the total of premiums paid but not reimbursed as capital exceeds €150,000, across all contracts, on December 31 of the year preceding the redemption, the 7.5% % rate applies only to the portion of gains equal to €150,000 divided by these premiums (assuming no premiums were paid before September 27, 2017); the remainder is taxed at 12.8% %.
Should the PER be withdrawn as a lump sum or as an annuity?
The spread capital retains 69.6% of each euro in the typical case, while the annuity retains 62.6% with a conversion rate of 4%. The annuity is subject to social security contributions on 40% of its amount at age 67. The choice also depends on the need for a lifetime income. The two can be combined: the PER (Retirement Savings Plan) allows for a lump sum, an annuity, or both.
What happens if I don't deduct my PER contributions?
There are no savings on the initial investment, but upon withdrawal as a lump sum, the portion corresponding to the undeducted contributions is exempt from income tax and social security contributions. Only the gains are taxed, at a flat rate of 31.4%. This option makes sense when the initial tax bracket is low.
Does the €4,600 allowance for life insurance apply to social security contributions?
No. It only reduces the base subject to income tax. The social security contributions of 17.2% (%) are levied on the entirety of the earnings.
Our position
We start with your profit, your deduction limit, your retirement age, and your expected retirement income bracket. Then, we work with you to determine the allocation between your retirement savings plan (PER) and life insurance, as well as your withdrawal schedule. We receive commissions on contracts taken out through our firm.
Book an exchange with Balmont Conseil
Alexis Sagnier, financial and real estate investment advisor, insurance broker, AMF certified. ORIAS 13003497. Updated on 28/10/2026.
Official sources consulted
- Official Bulletin of Public Finances (BOFiP), BOI-IR-BASE-20-50-20, limits on the deduction of contributions and retirement savings premiums (ceiling for a self-employed worker, carry-forward over five years): bofip.impots.gouv.fr
- BOFiP, BOI-RSA-PENS-30-10-20, Capital retirement benefits (withdrawal from the capital retirement savings plan, deducted and non-deducted contributions, gains, quotient), version of February 17, 2026: bofip.impots.gouv.fr
- BOFiP, BOI-ANNX-000513, summary of the taxation regime for retirement savings plans (annuity payout), version of February 17, 2026: bofip.impots.gouv.fr
- Service-public.gouv.fr, «Retirement savings plan (PER): taxation upon withdrawal» (capital, annuity, flat-rate levy of 31.4 %, taxable portions), verified on October 12, 2026: service-public.gouv.fr
- Service-public.gouv.fr, «Life insurance: taxation of redemptions» (allowance of €4,600 and €9,200, rate of 7.5% and 12.8%, threshold of €150,000, social security contributions of 17.2%), verified on April 15, 2026: service-public.gouv.fr
- Directorate General of Public Finances, "How are the proceeds of life insurance contracts taxed since January 1, 2018?", updated on March 20, 2026: impots.gouv.fr
- BOFiP, BOI-RPPM-RCM-20-15, rate of 12.8 % and reduced rate of 7.5 % (threshold of €150,000 and method of distributing gains): bofip.impots.gouv.fr
- BOFiP, BOI-RPPM-RCM-20-10-20-50, life insurance contract products (partial redemption, annual allowance, order of allocation): bofip.impots.gouv.fr
- Service-public.gouv.fr, «Social security contributions on income from assets and investments» (2026 rate: 18.6 % in general, 17.2 % for life insurance; law no. 2025-1403, article 12): service-public.gouv.fr
- Service-public.gouv.fr, «Income tax: tax brackets and rates 2026» (scale per share, law no. 2026-103 of February 19, 2026): service-public.gouv.fr
- Service-public.gouv.fr, «Declaring retirement pensions» (10% allowance capped at €4,439 per household for 2025 income), verified on April 15, 2026: service-public.gouv.fr
- Directorate General of Public Finances, practical brochure on income tax, "Pensions, retirement benefits and annuities" (retirement savings plan annuities, taxable portions of purchased life annuities): impots.gouv.fr
- National Pension Fund for French Bars (CNBF), 2026 scale, basic and supplementary schemes: cnbf.fr
