Employee savings: Early release up to 10,000 euros, what you need to know
Through John Foucault
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Several boosts have been granted as part of the two packages of measures to boost purchasing power recently passed by Parliament. Including the early release of employee credits up to 10,000 euros.
About 9.5 million people with worker savings in France may be affected and exceptionally release their funds to cope with inflation and price rises of all kinds.
What exactly is employee savings?
Employee savings are “a collective savings scheme set up in certain companies,” recalls the website service-public.fr.
If the company offers either a “bonus linked to company performance (profit-sharing) or a profit-sharing (profit-sharing)” the employee may choose to receive this bonus directly, which may also be paid out or deposited into an employee savings plan.
The company can offer different types of employee savings:
- A Company Savings Plan (PEE) that allows “buying securities with the help of the company”.
- A collective pension scheme (Perco) savings plan that allows you to lock up employee savings until retirement to have a supplementary pension. Since 1ah As of October 2020, the Perco can no longer be set up in companies, however it is still possible to deposit funds or convert them into a PER.
- A retirement savings plan (PER): This is the new retirement savings plan with which you can also build up an additional amount. It aims to replace all other existing savings plans, including Perco.
What has changed ?
In companies where employee savings plans are offered, the employee will receive a letter every year informing them of the amount from which they will benefit, received directly or paid into the employee savings account. In the latter case, the employee leaves an amount, which varies according to the company, in an account for an average period of five years (varies according to the savings plan).
We could do that to some extent
Until then, it was only possible to request an early release of the employee balance for certain reasons: termination of the employment contract (termination or resignation), death, disability, domestic violence, over-indebtedness, marital divorce, birth, home purchase … In this case, the Amounts resulting from the early redundancy “are exempt from income tax but are subject to social security contributions,” recalls service-public.fr.
With the new measure adopted by Parliament Employees can now release their employee credit at any time up to a maximum of 10,000 euros up to December 31, 2022.
Here, too, the amounts collected are not taxed and this time are not subject to social security contributions (currently 17.20%).
A way to restore purchasing power to approximately “9.5 million employees who will have access to at least one profit-sharing, profit-sharing or employee savings plan in 2020,” according to Dares.
To unlock these funds at once, you should move closer to your company. Note that collective retirement plans (Perco) are not eligible for the device, as if your savings were “allocated to funds invested in community-based enterprises.”
The measure will apply once the law has been published Official Newspaper.
And clarification: If the request for release can be made at any time up to 31.12.2022, the money collected must still be used for “the purchase of one or more goods or the provision of one or more services”, specifies the measure adopted.
The employee must keep himself “available”. [du fisc] the supporting documents proving the use of the released amounts”.
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