Assurance-vie: taxation of a withdrawal depending on the contract's age

When redeeming a assurance-vie policy, only the gains are taxed. The rate depends on two dates: the date of your premium payments (before or since September 27, 2017) and the contract's age (less than or more than 8 years). For premiums paid since September 27, 2017, the tax rate is 12.8% before 8 years. After 8 years, it is 7.5% under certain conditions and after a deduction. In both cases, social security contributions of 17.2% are generally added.

This page deals with French assurance-vie contracts held by tax residents of France, taken out since January 1, 1990. It does not deal with:

• the progressive income tax scale and your tax brackets; ;
• older contracts, which follow different seniority thresholds; ;
• non-residents and insurers established outside of France, who have their own pages; ;
• the payout as an annuity.

What is taxed: the gains, not the capital.

A partial or total redemption is not taxed in full. The tax is levied on the difference between the amounts reimbursed and the premiums paid. The premiums paid are the amounts actually paid by the policyholder.

For a partial redemption, only a fraction of the premiums is deducted, proportional to the amount of the redemption. The calculation is explained on a dedicated page.

The two dates that determine the rate

Each premium has its date. The contract has a seniority. The plan depends on the date of each premium and the duration of the contract at the time of redemption.

Bonuses paid since September 27, 2017

For a contract of less than 8 years, without option for the scale, the total is 30 %: 12.8 % of tax and 17.2 % of social security contributions.

Bonuses paid up to September 26, 2017

The proceeds associated with these bonuses are generally taxed according to the progressive tax scale. You can opt for a flat-rate withholding tax:

This option must be exercised no later than when the income is received. If you choose the flat-rate withholding tax of 7.5% (%) on a contract of 8 years or more, the annual allowance does not apply to the gross amount subject to withholding. It is recovered through a tax credit of 7.5% (%), by declaring the gross amount of the proceeds in box 2DH.

The threshold of €150,000 for the 7.5% % rate

The 7.5% % rate assumes that your premiums remain below a certain threshold. This threshold is calculated based on the total premiums paid but not yet refunded as a lump sum by December 31st of the year preceding the withdrawal. The €150,000 threshold is assessed globally across all your contracts.

Beyond that point, the 7.5% % rate applies only to a fraction of the gains. The remainder is taxed at 12.8% %. The calculation of this fraction is detailed on the page dedicated to the threshold.

The annual discount on contracts of 8 years and more

The allowance is €4,600 for a single person and €9,200 for a married or civil union couple filing jointly. Four rules to remember:

• It only concerns earnings from contracts of 8 years and more; ;
• It is only granted once a year, for all of your contracts; ;
• the unused portion does not carry over to the following year; ;
• It applies first to the products of premiums before September 27, 2017, then, for the balance, to the fraction taxable at 7.5 %, then to that taxable at 12.8 %.

It reduces income tax, not social security contributions.

Social security contributions: 17.2% on all earnings

Gains from a assurance-vie contract are subject to social security contributions, regardless of the contract's age. In principle, the rate is 17.2% in 2026. According to economie.gouv.fr, this rate applies to contracts "with a surrender value or guaranteeing the payment of a lump sum." Life annuity and disability savings contracts are subject to a rate of 18.6%.

The 2026 increase in the CSG (General Social Contribution) on investment products does not apply to you here. The tax administration's notice specifies: "Rental income, capital gains on real estate, assurance-vie, and home savings plans remain subject to the rate of 9.2%."«

How is tax paid?

1. The insurer deducts an advance payment from the gains: 12.8% for a contract of less than 8 years, and 7.5% for a contract of 8 years or more. This deduction is credited against the income tax due for the year.
2. You declare the income the following year. The tax is recalculated, with any applicable allowance. If the advance payment exceeds the tax due, the excess is refunded.
3. If your reference tax income for the year before last is less than €25,000 (single person) or €50,000 (couple filing jointly), you can request an exemption from the advance payment. The request must be made to the financial institution. You can verify the payment due date with them.

You can also opt for the progressive tax scale by checking box 2OP. This option is comprehensive: it applies to all your investment income and capital gains from the sale of securities for the year. With this option, a portion of the CSG (General Social Contribution) of 6.8% is deductible. The rules for revising this option should be checked before checking the box.

Cases of income tax exemption

Gains may be exempt from income tax if the contract is terminated after one of these events, affecting the beneficiary of the proceeds or their spouse or civil partner:

• a dismissal; ;
• early retirement; ;
• a disability of the 2nd or 3rd category; ;
• the cessation of a self-employed activity following a judicial liquidation.

The buyout must take place no later than December 31st of the year following the event. A mutually agreed termination or the end of a fixed-term contract does not qualify for this exemption. Social security contributions remain payable.

Where this is declared

For the 2026 tax return (covering 2025 income), assurance-vie proceeds are reported on form 2042. Here are the main boxes:

The box numbers are checked annually on the current form.

Numerical example (fictitious profile)

Situation. Sophie, single and a tax resident of France, needs cash in 2026. She holds two French assurance-vie policies. The first was taken out in 2021. The second was taken out in December 2017 and will be over eight years old in 2026. All premiums were paid after September 27, 2017. Assumptions: the outstanding premiums on both policies do not exceed €150,000 on December 31, 2025; Sophie has no other assurance-vie products this year; and she does not opt for the fixed-rate withdrawal option. A withdrawal from either policy would yield €10,000 in gains.

Issue. Which contract incurs the least tax on redemption?

Strategy. Compare the tax and social security contributions on the same gain of €10,000 on each contract, then the case of a married couple taxed jointly on the contract of more than 8 years.

Result.

On the 2017 contract, the €750 advance payment exceeded the tax by €405: the excess of €345 was refunded. These profiles are hypothetical. The assumptions simplify the situation. The figures illustrate the calculation and do not predict your outcome.

What changes depending on your situation

• The date of each of your bonuses : the same contract may mix bonuses from before and after September 27, 2017.
• The seniority of the contract at the time of the acquisition.
• The total of your unrefunded premiums, across all contracts, compared to the threshold of €150,000.
• Your family situation : a tax reduction of €4,600 or €9,200.
• Other assurance-vie or capitalization products of the year, who share the same dejection.
• An event that qualifies for exemption, like a dismissal.
• Your tax residence : a non-resident is subject to different rules.

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