This is the last moment to take advantage of this tax optimization.
The end of the year approaching is not only synonymous with the start of the Christmas puzzle. Too few French people think about it, but it is also – and above all – the last moment to reduce the amount of taxes that will have to be paid in 2025. In a few weeks, it will be too late.
To reduce the amount to be paid to the tax authorities, without making any expenditure such as a donation to an organization, there is a mechanism accessible to all French people, regardless of their income. This allows you to make significant savings since, on average, the system allows you to reduce the total amount of taxes by several hundred euros.
With a view to retirement, many French people are looking for various ways to put money aside. Real estate investment, savings accounts, financial investments… Several methods are used. One of them is becoming more and more popular: the Retirement Savings Plan (PER).
More than 15 million French people have one. This is an account, opened at the bank and different from life insurance, into which money can be paid and which generates some interest. But the main advantage does not lie here.
When a payment is made to your PER, part of the amount is tax deductible. It can be deducted 11, 30, 40 or 45% of the amount, depending on your marginal tax rate (it is indicated on your last tax notice). Concretely, if over the course of a year I pay 3900 euros into a PER (the average payment in 2021), I will be able to subtract 429, 1170, 1560 or 1755 euros from the total to pay in taxes.
However, do not expect to reduce your tax amount to 0. A deduction limit is set at 10% of your net taxable income.
To benefit from this reduction, you must not delay in making a payment into your PER. In fact, it is the amounts paid until December 31 that will be deductible on your next tax return in spring 2025.
Also be careful: any payment into a PER automatically blocks the money until retirement. Only a few exceptional cases allow it to be released before this date: purchase of a main residence, death of a spouse, disability, over-indebtedness, expiry of unemployment rights or cessation of activity after judicial liquidation.