In summary…
First the PER (retirement savings plan), up to its deduction limit, then life insurance for the rest. A self-employed craftsman who generates €60,000 of profit per year for 35 years affects approximately €25,900 gross per year of the self-employed social security at age 67, representing 43 % of his benefit. To recover 70 %, he must save approximately €9,430 per year for 20 years. Its PER 2026 deduction limit is €4,789 : it covers 51 % of this effort and saves €1,437 of tax, because the payment is deducted from the 30% tax bracket. Upon retirement, the pension places it in the 11% tax bracket: the deducted payments, withdrawn over 10 years, are taxed at an average of 17.5%. With the same net effort, the PER (Retirement Savings Plan) and then life insurance leave €280,834 net at 67 years old, against €261,282 in life insurance alone, that is €19,552 more (yield of 4 % per year net of expenses, calculation assumption).
1. What the Social Security for the self-employed pays out on a profit of €60,000
The self-employed tradesperson contributes to the Social Security for the Self-Employed (SSI) on a base equal to their profit less a flat-rate allowance of 26% (%), without deducting social security contributions. For €60,000 of profit, the base is €44,400. This remains below the 2026 annual Social Security ceiling (€48,060): the income on which contributions are based therefore entitles the holder to benefits in its entirety. The calculation follows the method of... A craftsman's retirement in 2026 : 35 years of contributions, 140 quarters, reference period of 172 quarters, with a benefit of €60,000 instead of €50,000.
| Floor | 2026 membership fee of €44,400 | Acquired right |
|---|---|---|
| Basic pension | 17.87 % up to €48,060: €7,934 | Pension = 50 % × average annual income × validated quarters ÷ 172 |
| Supplementary pension | 8.1 % up to €44,286, then 9.1 %: €3,598 | Points: membership fee ÷ €21.726. One point pays €1.347 per year |
| Disability-Death | 1.30 % up to €48,060: €577 | Mandatory insurance, without a retirement pension |
| Total | €12,109 per year | All 4 quarters of the year have been validated (threshold of €1,289 of basic contribution) |
One point of divergence between the sources: the service-public.gouv.fr website and the French National Retirement Insurance Fund (Assurance retraite) circular of December 22, 2025, set the limit for the first bracket of supplementary retirement benefits at €44,286; the circular of April 4, 2025, describes it as equal to a Social Security ceiling. In this case, the difference is €1.14 in contributions per year: it does not change the outcome of the article.
| Floor | Calculation | Gross annual pension |
|---|---|---|
| Basic pension | 50 % × €44,400 × 140 quarters ÷ 172 | €18,070 |
| Supplementary pension | 165.6 points per year × 35 years = 5,796 points × €1.347 | €7,807 |
| Total | €2,156 per month | €25,876 |
The pension represents 43.1% of the profit. To reach 70 % of the profit, or €42,000 per year, there is a shortfall €16,124 per year over 25 years of retirement. At a return of 3 % during retirement, this cash flow requires capital of €280,763 at age 67. To build it up over 20 years at 4 % per year, the craftsman must save €9,429 per year, or €786 per month (15.7% of the profit). This is the effort that the PER and life insurance must finance.
2. The deduction limit for a self-employed tradesperson's retirement savings plan (PER) in 2026
For a self-employed worker, the deduction limit for a payment is the higher of two amounts : 10 % of the previous year's taxable profit, capped at 8 times the Social Security ceiling, or 10 % of the previous year's Social Security ceiling. The ceiling used is that of 2025 (€47,100). For a payment in 2026, the minimum is €4,710 and the maximum of €37,680 (BOFiP, BOI-IR-BASE-20-50-20). Voluntary retirement savings contributions already deducted from profit reduce this ceiling.
The profit considered is the taxable profit, that is, after deduction of mandatory social security contributions. The typical case uses a calculation assumption: only the retirement and disability-death contributions from the previous table are deducted (€12,109). The taxable profit is then €47,891 and the ceiling of €4,789 (10 % of €47,891). Health insurance contributions, family allowances and the deductible general social contribution further reduce taxable profit: if taxable profit falls to €47,100 or less, the floor of €4,710 applies. This craftsman's ceiling is therefore between €4,710 and €4,789., or approximately 8 % of its profit.
This limit covers 51% of the €9,429 annual savings effort. The remainder is not deductible. Any unused limit from a given year can be carried forward to the following five years (BOFiP of August 10, 2026): a self-employed individual who has never contributed to a PER (Retirement Savings Plan) will have a cumulative limit exceeding the limit for that particular year. Details of how this works can be found on our page. PER deduction limit.
3. Tax savings in tiers in 2026
The craftsman is single, has one share, and no other income. His taxable income before payment is €47,891. The 2026 income tax scale applies 0 % up to €11,600, 11 % from €11,601 to €29,579, 30 % from €29,580 to €84,577 and 41 % from €84,578 to €181,917 (law no. 2026-103, article 4).
| 2026 scale bracket | Income in the bracket without PER | Income in the bracket with PER | Tax without a retirement savings plan (PER) | Tax with PER |
|---|---|---|---|---|
| 0 % (€0 to €11,600) | €11,600 | €11,600 | €0 | €0 |
| 11 % (€11,600 to €29,579) | €17,979 | €17,979 | €1,978 | €1,978 |
| 30 % (€29,579 to €84,577) | €18,312 | €13,523 | €5,494 | €4,057 |
| Total | €47,891 | €43,102 | €7,471 | €6,035 |
The payment of €4,789 removes €4,789 from the 30 % tranche: the tax goes from €7,471 to €6,035. The savings amount to €1,437, This amounts to exactly 30 % of the payment. The actual cost to the self-employed individual is €3,352. The payment remains entirely within the 30 % bracket as long as taxable income exceeds €34,368: an additional €13,523 in deductible contributions would be required to fall below this threshold. The savings are solely on income tax; we are not considering any reduction in social security contributions.
4. Exiting the PER upon retirement
| Exit mode | Rule in 2026 |
|---|---|
| Capital: payments deducted | Taxed according to the income tax scale, without the 10% allowance for pensions and without social security contributions. The capital can be paid in one or more installments. |
| Capital: gains | Single flat-rate levy of 31.4% for interest received since January 1, 2026: 12.8 % of tax and 18.6 % of social security contributions. |
| Capital: payments not deducted | Exempt from income tax and social security contributions. Only the gains are taxed at 31.4 %. |
| Annuity: payments deducted | Taxed as a 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: 70% before age 50, 50% from age 50 to 59., 40 % aged 60 to 69, 30 % from age 70. |
| Annuity: payments not deducted | Regime of life annuities for valuable consideration: only the same fraction (70, 50, 40 or 30 %) is taxable and subject to social levies of 18.6 %. |
At 67, the craftsman receives €25,876 in pension payments. After the 10% allowance (€2,588), his taxable income is €23,289, resulting in €1,286 in tax. He has left €6,290 per year in the 11 % bracket before reaching 30 %. This figure determines the cost of withdrawal: the slower the capital is withdrawn, the higher the portion taxed at 11 %.
| Capital withdrawal period | Payments deducted, withdrawals per year | Tax on payments deducted (total) | Average rate |
|---|---|---|---|
| 1 year | €95,782 | €31,334 | 32.7% |
| 5 years | €19,156 | €22,759 | 23.8% |
| 10 years | €9,578 | €16,783 | 17.5% |
| 16 years old | €5,986 | €10,536 | 11.0% |
Over 10 years, each withdrawal of €9,578 fills the €6,290 margin at 11 % and places €3,288 in the tranche at 30 %. The average rate is 17.5 %, compared to 30 % at the start. Over 16 years, the entire withdrawal remains at 11 %. Withdrawn in a single year, the same deposits cost 32.7 %. Spreading the output is the first lever of the PER.
As an annuity (conversion rate of 4% of the capital at age 67, calculation assumption), the €142,610 capital in the PER (Retirement Savings Plan) pays out €5,704 per year. The annuity is added to the pension, remains in the 11% tax bracket, and is subject to social security contributions on 40% of its amount: €565 in income tax and €424 in social security contributions, representing 17.3% of the annuity. The capital spread over 10 years retains 77.9% of this amount, while the annuity retains 82.7%. The annuity provides a lifetime income, while the capital offers immediate access to funds.
5. Life insurance after eight years
| Point | Rule in 2026 |
|---|---|
| Contract of less than 8 years | Gains taxed at 12.8 %, without deduction. |
| Contract of 8 years or more: discount | Annual allowance of €4,600 on earnings for a single person (€9,200 (for a couple subject to joint taxation), a single contract for all household contracts. |
| Contract of 8 years or more: rate | 7.5% after the allowance, as long as the premiums paid and not reimbursed as capital, across all contracts, do not exceed €150,000. Beyond that, the portion of the gains that does not benefit from it is taxed at 12.8 %. |
| Social charges | 17.2% on the gains, without any reduction. |
| Entry advantage | None: the payment is not deducted from income. |
The PER (Retirement Savings Plan) and life insurance operate in opposite ways. The PER offers an advantage upon entry, at the cost of tax on withdrawals and a lock-in period until retirement. Life insurance offers no upfront benefit, remains accessible at any time, and reduces taxes on gains after eight years. The comparison hinges on a single difference: the tax bracket for entry (30% tax bracket) versus that for withdrawal (11% tax bracket, then 30% tax bracket for a portion).
6. Comparative calculation with identical net effort
| Calculation assumption | Value retained |
|---|---|
| Artisan | 47 years old, single (1 tax unit), sole proprietorship, €60,000 annual profit before social security contributions, stable; no other income or existing voluntary retirement plan |
| Savings effort | €9,429 per year for 20 years, from age 47 to 67 (section 1) |
| Yield | 4 % per year, net of fees, identical for the PER and for life insurance; payments at the end of the year (calculation assumption, no return is guaranteed) |
| Euros | Constants: tax brackets, ceilings, rates and levies from 2026 remain unchanged until exit; profit and deduction ceiling remain constant. |
| Tax saving | Accounted for in the year of payment and reinvested in life insurance under plan B |
| Retirement at 67 | Pensions of €25,876 per year, with no other income: €23,289 taxable after the 10% allowance. |
| Exit | 10 equal annual withdrawals from age 67 to 76, with no return after age 67 (assumption isolating the effect of tax): capital from the PER (Retirement Savings Plan) and redemptions from life insurance. |
| Assurance-vie | Contract opened at age 47 (therefore more than 8 years at the time of termination), no other contract in the household; social security contributions of 17.2% on gains; rates of 7.5% and 12.8% spread annually according to the remaining premiums. |
Typical case
Situation. A self-employed plumber, 47 years old today, who settled in Lyon at 32, is single, has no children, and runs his own business. His annual profit is €60,000 and remains stable. He will retire at 67 after 35 years of contributions, with no further career prospects.
Issue. The self-employed social security system pays him €25,876 per year (43.1% of his profit). He aims for 70% of his profit, or €42,000: he is short €16,124 per year, requiring a capital of €280,763 and an effort of €9,429 per year for 20 years. He is hesitating between a retirement savings plan (PER), which reduces his tax burden immediately, and life insurance, which remains accessible.
Strategy. Option A: €9,429 per year in life insurance. Option B: €4,789 per year in the PER (its maximum contribution limit), which refunds €1,437 in tax, and €6,076 per year in life insurance, resulting in a net effort of €9,429 (€3,352 + €6,076), the same as Option A. Options C and D, to isolate the effect of the PER: €4,789 in the PER versus €3,352 in life insurance, resulting in the same net effort of €3,352. At age 67, he withdraws from the PER and the life insurance over 10 years.
Result. Assembly B leaves €280,834 net after tax, versus €261,282 for assembly A, that is €19,552 more With the same effort. For the same net effort of €3,352, the PER (Retirement Savings Plan) leaves €111,123 and life insurance €94,189. References: deduction limit according to BOFiP BOI-IR-BASE-20-50-20, scale according to law no. 2026-103, article 4.
Capital at age 67 and exit tax
| Assembly | Annual payments | Net effort per year | Capital at 67 years old | including earnings | Tax and charges on exit | Net after tax |
|---|---|---|---|---|---|---|
| A. Life insurance alone | €9,429 | €9,429 | €280,763 | €92,193 | €19,481 | €261,282 |
| B. PER at the ceiling then life insurance | €4,789 + €6,076 | €9,429 | €323,546 | €106,241 | €42,712 | €280,834 |
| C. PER alone on the ceiling | €4,789 | €3,352 | €142,610 | €46,828 | €31,487 | €111,123 |
| D. Life insurance alone, same effort as C | €3,352 | €3,352 | €99,827 | €32,780 | €5,638 | €94,189 |
Details of the output of assembly B
| Item | Base | Rate | Amount |
|---|---|---|---|
| PER: Contributions deducted, withdrawals | €95,782 | 11 % then 30 % (17.5 % on average) | €16,783 |
| PER: earnings (single flat-rate levy) | €46,828 | 31.4% | €14,704 |
| Life insurance: income tax | €59,413 | 7.5 % after €4,600 of tax relief per year | €1,006 |
| Life insurance: social security contributions | €59,413 | 17.2% | €10,219 |
| Total at exit | €323,546 | 13.2 % of capital | €42,712 |
In scenario A, the life insurance policy receives €188,570 in premiums, exceeding the €150,000 threshold: in the first few years after withdrawal, a portion of the gains increases to 12.8% of the taxable income. In scenario B, it receives €121,523 in premiums and remains below the threshold. The annual gains of €5,941 exceed the €4,600 allowance: the life insurance income tax is €1,006 on the entire payout, and the social security contributions of 17.2% of the taxable income have the greatest impact.
And if the yield is 2 % or 6 %?
| Net return after expenses | A. Life insurance alone | B. PER then life insurance | Difference B − A | C. PER alone | D. Life insurance, same effort | Difference C − D |
|---|---|---|---|---|---|---|
| 2% | €222,119 | €236,261 | €14,141 | €93,117 | €78,976 | €14,141 |
| 4% | €261,282 | €280,834 | €19,552 | €111,123 | €94,189 | €16,934 |
| 6% | €310,919 | €335,918 | €24,999 | €134,145 | €112,870 | €21,275 |
The PER (Retirement Savings Plan) is the better option in all three cases. The difference increases with the return, because the €1,437 annual tax saving is invested from the first year. The result is primarily based on the difference between the entry and exit tax brackets.
What if the pension doubles as retirement income?
If the self-employed individual retains €15,000 of taxable income per year in retirement (net rental income, for example), their withdrawals from the PER (Retirement Savings Plan) are taxed at 30% of the taxable income, as they were at the time of contribution. The tax on deducted contributions increases to €28,735, or 30% of the taxable income of €95,782, and the PER alone leaves €99,172 compared to €94,189 for life insurance with the same level of effort, a difference of €4,983. The advantage remains but decreases by €11,952: it no longer stems from the lower tax bracket, but solely from the tax savings accumulated over 20 years. Each additional percentage point of average withdrawal rate reduces the PER's taxable income by €958: the advantage would be eliminated at an average rate of approximately 35% of the taxable income.
7. How to organize payments
- The PER first, up to the ceiling. Each euro deducted from the 30 % scheme costs the tradesperson €0.70. The €4,789 limit is checked annually against the previous year's taxable profit.
- The tax savings go into life insurance. The €1,437 recovered feeds into an available contract, which remains below the €150,000 premium threshold.
- The supplement is provided through life insurance. Beyond the ceiling, the PER no longer provides a deduction: the remaining €4,639 per year goes into life insurance, the contract of which must be opened early in order for the eight-year seniority to be acquired.
- The capital from the PER is withdrawn over several years. With a margin of €6,290 per year at 11 %, a 16-year exit keeps all withdrawals at 11 %; over 10 years, the average rate is 17.5 %.
- Cases of early release from the PER are limited. Death of a spouse, disability, excessive debt, end of unemployment benefits, bankruptcy of a self-employed business, purchase of a primary residence. Apart from these cases, the money is locked until retirement: the available reserve is built up in a life insurance policy.
Beyond retirement savings plans and life insurance, real estate is taking over: see our pages SCPI and non-professional furnished rental provider. The other levers are gathered on the page tax exemption. The page Individual PER details how the contract works.
8. What the calculation does not retain
- Inflation and pension revaluation: all amounts are in constant 2026 euros.
- Health insurance contributions, family allowance contributions and the deductible general social contribution, which lower taxable income and, beyond a threshold, the deduction ceiling.
- Contract fees and performance differences between a PER and a life insurance policy, assumed to be zero here.
- The schedule of social security contributions for life insurance: they are calculated in one lump sum upon withdrawal, whereas some investment vehicles deduct them annually.
- The evolution of the scale, ceilings and social security contributions between 2026 and the exit.
- Family situation: a couple or a household with children changes the shares, the brackets and the allowance of life insurance.
Frequently asked questions
What is the maximum deduction limit for a self-employed tradesperson's retirement savings plan (PER) in 2026?
The higher of 10 % of the 2025 taxable profit (capped at up to 8 times the Social Security ceiling) and 10 % of the 2025 Social Security ceiling, i.e., a minimum of €4,710 and a maximum of €37,680. For a profit of €60,000 before contributions, the typical amount is €4,789. The unused portion of the ceiling can be carried forward to the following five years.
How much tax does a craftsman with €60,000 in profit save with a payment into a PER (retirement savings plan)?
€1,437 for a payment of €4,789, i.e., 30 %: the taxable income of €47,891 falls within the 30 % bracket of the 2026 tax scale (from €29,580 to €84,577) and remains there after the payment. The actual tax effort is €3,352.
Should the PER be withdrawn as a lump sum or as an annuity?
In the typical case, a capital sum spread over 10 years retains 77.9% of each euro withdrawn, while an annuity retains 82.7% with a conversion rate of 4% (calculation assumption): the annuity remains in the 11% tax bracket and is subject to social security contributions on only 40% of its amount. A capital sum spread over 16 years retains 82.3%. The annuity provides a lifetime income, while the capital provides liquidity. The two can be combined.
When is life insurance preferable to a PER (retirement savings plan)?
When money needs to remain available before retirement, when the deduction limit has already been reached, or when the average withdrawal rate from the PER (Retirement Savings Plan) significantly exceeds the entry rate: in a typical case, the advantage of the PER would disappear around an average withdrawal rate of 35%. With a pension of €25,900, the withdrawal rate remains at 17.5% on average over 10 years.
Does the PER (Retirement Savings Plan) reduce the social security contributions of the craftsman?
The calculation does not account for any reductions: the savings come solely from income tax. Service-public.gouv.fr indicates that the self-employed worker's contribution base includes, in particular, group insurance premiums and optional supplementary contributions. Your accountant confirms the processing of your file.
Our position
We start with your contribution statements, tax assessment, and career summary, not an average. We do not draft documents or provide legal or accounting advice: your accountant validates the taxable income, the deduction limit, and the contributions. We measure the gap between your pension and your current income, then work with you to develop an allocation between your retirement savings plan (PER), life insurance, and real estate, as well as an exit strategy. 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
- Service-Public Entreprendre, "Pension scheme for the self-employed" (2026 rate, limit of the first tranche of the supplementary scheme, reference period, legal age, calculation of the basic pension): entreprendre.service-public.gouv.fr
- Service-Public Entreprendre, "Social protection for artisans and traders" (disability-death at 1.30 %, contribution base, allowance of 26 %): entreprendre.service-public.gouv.fr
- Service-Public Entreprendre, "Reform of the social security contribution base for the self-employed" (26% reduction, 2026 contributions): entreprendre.service-public.gouv.fr
- Retirement insurance, Cnav circular 2025-31 of December 22, 2025 (service value €1.347, acquisition value €21.726 per point and supplementary scheme ceiling of €44,286): legislation.lassuranceretraite.fr
- Retirement insurance, Cnav circular 2025-14 of April 4, 2025 (rates of 17.87 %, 8.1 % and 9.1 %): legislation.lassuranceretraite.fr
- Retirement Insurance, Cnav circular 2025-33 of December 23, 2025 (validation of quarters in 2026, contribution of €1,289 for four quarters): legislation.lassuranceretraite.fr
- Retirement insurance, Cnav circular 2026-01 of January 5, 2026 (2026 Social Security ceiling of €48,060, maximum personal pension of €24,030): legislation.lassuranceretraite.fr
- BOFiP, BOI-IR-BASE-20-50-20, limits on deduction of retirement savings contributions (ceiling for a self-employed worker, profit retained, carry-forward over five years): 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, cases of early withdrawal), 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?", modified on March 20, 2026: 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), verified on June 30, 2026: 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, article 4): 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
