New Retirement Savings Plan: do you know the 'PERE OB'?

The february 05, 2020

Whether you are an employee or an employer, employee savings concerns you and represents one of the subjects developed by the PACTE law, passed last May.

The various employee savings plans have been redesigned with the aim of simplification and greater flexibility.
Retirement savings have been redesigned into a single product with several compartments: the Retirement Savings Plan (French 'PER').

Let’s take a closer look at the new Obligatory Retirement Savings Plan (French 'PERE OB') still little known, replacing the Article 83 contract.

The PERE OB is a collective retirement savings product, set up within a company for the benefit of its employees. It provides them with an additional retirement pension.

Its establishment is optional and can take place by means of a referendum within the company, a unilateral decision of the employer, or a collective agreement. Once the contract is in place, payments become mandatory for the employer and employees.

The contribution rate is defined in advance as well as the distribution of contributions between the parties. It can also be agreed that only the employer will be subject to compulsory payments (this will result in less attractive taxation).

What advantages for the employee?
-Mandatory payments are exempt from income tax (within the limit of 8% of gross annual remuneration without exceeding 8 times the PASS
-The rights resulting from this contract are acquired by the beneficiary even in the event of departure from the company concerned
In short, the employee reduces his current taxation while earning additional income in anticipation of his retirement.

What advantages for the employer?
-The contributions paid are deductible from the taxable profit of the company
- Payments exempt from social security contributions (up to the highest amount between 5% of the PASS and 5% of the employee's gross annual remuneration, limited to 5 times the PASS) but subject to the social package
-The social package is 16% instead of 20% for the old Article 83 contracts, hence the advantage of modernizing the employee savings plan of the company by adopting the new PERE OB
- Attractiveness in terms of employee recruitment and retention

Would you like to know more about this new product? Our Wealth A7 wealth and financial experts will inform you and support you in setting up the system within your company: benefit from our expertise.


Article by : Orane TREHET

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