Employee savings can be unlocked more easily by the end of the year

The Senate introduced the possibility of releasing up to EUR 10,000 of its employee savings plan early by the end of the year without justification other than financing expenses.

The Senate Social Services Committee has included a measure in the Purchasing Power Act that allows for early release of worker savings, noted The Echoes. A measure aimed at protecting the purchasing power of the French and boosting consumption. The final text will be voted on in Parliament on Wednesday.

What is employee savings?

Employee saving consists of paying employees a bonus linked to the success of the company (profit-sharing) or representing a share in the profits (profit-sharing). Payment of the latter is mandatory in companies with more than 50 employees, while the former depends on goodwill.

When the employee receives his bonus(es), he has two options. Get this amount immediately. It is then incorporated into his income and is thus taxable, or locked into a PEE for five years. At the end of this period, the employee can get their money back without having to pay any additional income tax.

Even before the end of these five years, it is possible to withdraw your money, provided that you meet one of the ten cases of early dismissal provided for by law. Marriage or pact, birth or adoption of a third child, separation, death of spouse, establishment of primary residence, termination of employment…

In order to protect the purchasing power of the French if inflation continues to rise, the Senate wanted to make it exceptionally possible to release employee savings early. Specifically, by the end of the year, any employee who so wishes can release the profit sharing and/or profit sharing stored in their PEE within the limit of 10,000 euros without this sum being subject to income tax.

However, one rule must be observed: the money should not be put on a booklet or a life insurance contract. It must be dedicated to “the acquisition of goods or the provision of services”. The employee must also keep available to the tax authorities “the supporting documents showing the use of the amounts released”.

In addition, if “these savings are invested in shares of the company, they cannot be released without a specific consent from the employer”, specifies Mathieu Chauvin, President of the Eres Group, this Tuesday on our antenna. Retirement assets cannot be released either.

An effective device?

This extraordinary early withdrawal rule is not a premiere. As early as 2003/04, then in 2008 and 2013, the governments of the time offered employees the opportunity to tap into their company savings plan.

“It is in keeping with the times, but whether it will actually and substantially bear fruit is no less certain. 2013 showed that it was more of a fiasco as very few savings were finally released,” commented Mathieu Chauvin.

In fact, eight years ago, François Hollande allowed his employees to reclaim up to 20,000 euros between July and December to boost consumption. But this incitement had only partially borne fruit. According to the French Association of Management (AFG), quoted by The Echoesless than half a million beneficiaries had taken advantage of this opportunity for a total of €2.2 billion in advance, while the government reckoned it would cost €4 billion.

Kaddouri Ismail

I am Ismail from Morocco, I work as a blogger and online marketer. I am also the founder of the “Mofid” site, in which I constantly publish many important articles in the field of technology, taking advantage of more than 5 years of experience working in the field. I focus on publishing in a group of areas, the most important of which are programming, e-marketing, digital currencies and freelance work.

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