Single company retirement saving plan - PERU
The Single Company Retirement Savings Plan created by the PACTE law resembles the Collective Retirement Savings Plan (PERECO) as it works almost identically, except for the fact that a PERU, unlike a PERECO, also provides for compulsory contributions paid in by your employer.
This solution enables you to receive additional income on your retirement, with the help of your employer and within a favourable fiscal and social framework.
Key information
Finance supplementary retirement savings thanks to your employer
Your PERU is topped up with contributions paid in regularly by your employer. You may also top up your PERU in various ways, such as by making voluntary payments or payments from your employee savings and time savings accounts if so allowed under your scheme.
Take advantage of a favourable tax regime
The amounts allocated to a PERU (profit-sharing bonus, incentive bonus and employer contribution) are exempt from income tax and subject only to CSG (social security contributions) and CRDS (social debt repayment contributions)1.
Release your retirement savings under various circumstances
The amounts saved in a PERU are inaccessible until you retire but may be released early under specific circumstances permitted by law.
How does it work?
You may benefit from a PERU scheme if one has been set up by your employer.
Your savings will be allocated across 3 compartments depending on their source:
Voluntary Retirement Savings compartment
- made up of your voluntary payments
- when you retire, you may withdraw your savings as an annuity and/or lump sum
Mandatory Retirement Savings compartment
- made up of compulsory contributions paid in directly by your employer (employer’s share, potentially supplemented with an employee’s share)
- when you retire, you may withdraw your savings only as an annuity unless the amount is below or equal to €1,200/year; in this case, the savings can be withdrawn either as a lump sum or an annuity
Time and Salary Retirement Savings compartment
- made up of your unused leave, your time savings account and your incentive and profit-sharing bonuses if so allowed under your scheme
- when you retire, you may withdraw your savings as an annuity and/or lump sum
Each of these compartments may also be topped up with funds transferred from other schemes.
When you retire, the amounts paid into the PERU become available in the form of a life annuity, a lump sum2 or a combination of the two.
Should you run into financial difficulties, you may withdraw your savings as a lump sum under specific circumstances allowing for early release stipulated in the regulations.
How are your savings invested?
Your company offers various investment vehicles covering different investment objectives and risk levels.
These investment vehicles (and the associated documentation) can be found in the rules governing the relevant employee or retirement savings plan(s) offered by your company.
Your PERU may be an insurance policy (PERU Assurantiel) or a securities account (PERU Compte-titres).
The distinction between these two schemes may concern the financial management method, the tax regime applicable in the event of death, and/or the administration fees payable after leaving the company. You can find all this information in detail in the information brochure (for the insurance policy) or in the rules applicable to the employee savings plan (for the securities account scheme).
PERU Assurantiel (insurance policy)
You may invest your savings in either of these vehicles:
- The euro-denominated Sécurité vehicle, the annual revaluation of which is fully vested. The amount of savings invested therefore increases year after year. The interest calculated generates interest in subsequent years. This vehicle consists mostly of bonds with a very cautious investment profile.
- Other unit-linked vehicles enabling you to allocate your savings according to different investment objectives, different asset classes, risk levels, regions, business sectors, etc. Note that unit-linked vehicles entail a risk of loss of capital.
PERU Compte-titres (securities account)
Your savings are invested in investment vehicles enabling you to allocate your savings across different asset classes, risk levels, regions, business sectors, etc.
You have two options when it comes to managing your savings:
- Manager-guided investment, delegating management of your savings to asset management experts; this enables you to take advantage of the opportunities offered by the financial markets by investing in various vehicles and to gradually secure your savings until you retire.
- Self-managed investment, enabling you to freely choose to allocate your savings between various financial vehicles and to change this allocation whenever you so wish.
You may switch from one type of management to another at any time free of charge, but also modify your investment choices by switching between funds, in accordance with the terms and conditions set out in the scheme’s rules.
What happens to your savings if you change company?
Your retirement savings will continue to grow even if you leave the company.
You may continue to make optional individual payments, either on a one-off basis or via a standing order, provided you have not signed up to a PERU subscribed by your new employer.
PERU Assurantiel (insurance policy)
On your departure, the fees applied to your insurance policy do not change.
PERU Compte-titres (securities account)
On your departure, you will have to begin paying the account administration fees inherent in the scheme that were previously paid by your former employer (see the pricing terms provided by your former employer’s account-keeper).
What happens to your savings in the event of death?
Your savings will not be lost; in the event of death, your beneficiaries must submit a request for withdrawal along with a death certificate.
The savings will then be transferred to your relatives in accordance with your PERU plan’s terms and conditions.
PERU Assurantiel (insurance policy)
The beneficiary clause enables you to designate the person(s) who will receive the savings that have accumulated, with favourable death duties applied.
A beneficiary clause is a means of protecting your relatives from the moment you join the scheme and is shown in your subscription certificate.
The scheme provides for a minimum guarantee, which means that the beneficiary(ies) will receive, at the very least, the accumulated amount of net payments made since you joined the scheme.
PERU Compte-titres (securities account)
The savings in your PERU Compte-titres will be transferred to your heirs or to the solicitor managing your inheritance. The request to release your savings (full withdrawal) must be made to the Société Générale account-keeper at any time as from the date of death, without any time limit.
However, any capital gains realised as from the 1st day of the 7th month following your death will lose their tax exemption and become taxable in accordance with common law conditions.
What is the tax regime applicable to this scheme?
Your scheme offers the following tax benefits:
- The voluntary payments you make may be deductible from your total taxable net income within certain limits stipulated by law.
- The employer’s contribution is exempt from income tax and subject only to CSG (social security contributions) and CRDS (social debt repayment contributions)1.
- Profit-sharing and incentive bonuses are exempt from income tax and subject only to CSG and CRDS1.
- Entitlements transferred from the TSA or unused leave are exempt from income tax and subject only to CSG and CRDS1.
- The taxregime applicable to withdrawn savings is favourable and specific to each compartment and to each type of withdrawal made, as described in the table below.
Refer to the factsheet for all the tax-related information regarding the PERU
1 At a rate of 9.7%, of which 6.8% tax-deductible CSG, at 01/01/2023; contributions deducted by your employer.
2 Except for the compulsory contributions compartment for which withdrawals must be made in a lump sum if the amount of your annuity exceeds €1,320 per year