LEP 2022. The Minister of the Economy, Bruno Le Maire, must unveil the new rate for the Livret A on February 1, 2022, this Friday. Mechanically, the popular savings account rate will also increase.
[Mis à jour le 14 janvier 2022 à 09h04] You probably know the livret A best, but have you ever heard of the popular savings account (LEP)? Since February 1, 2020, the LEP rate has been set at 1%. On February 1, 2022, the popular savings account rate will be raised due to inflation, the final figures of which were released by INSEE on Friday.
With inflation already hitting 2.8% YoY last December, the LEP rate should get a big boost, to stand at 2.2%! A new rate which should be confirmed this Friday by the Minister of the Economy, Bruno Le Maire, guest of the 1 p.m. news from TF1.
“The popular savings account is completely protected against inflation,” argued the Governor of the Banque de France to LCI recently. “(…) There are 15 million French people who can benefit from it. It is for French people with little or no taxation. There are many French people who are entitled to it and who have not opened an LEP. The yield of the LEP, after the revision, will be more than twice as high as that of the livret A. This makes a significant difference (…) The real product of protection of purchasing power is the livret d’ popular savings”.
Little known to the general public – and this, when it was created in the 1980s -, this regulated savings product is aimed at French people whose resources are limited. The opening of a booklet is therefore conditional on the applicant’s income, which must not exceed a ceiling, depending on the number of family quotient shares. Here are the limits not to be exceeded to open a LEP in 2022:
- 1 share: €20,296
- 1.5 shares: €25,716
- 2 units: €31,135
- 2.5 units: €36,554
- 3 units: €41,973
- 3.5 shares: €47,392
- 4 shares: €52,811
- Per additional half share: €5,420.
It is possible to place up to 7,700 euros on a LEP, excluding capitalized interest. It is therefore possible to continue to capitalize interest once the ceiling has been reached. It should also be noted that no operation can have the effect of making the account debit.
The rate of the LEP is equal to the remunerative rate of the Livret A, increased by an increase. It was 1.25%. The LEP rate remained frozen for two years. It was however lowered to 1% in February 2020, decision resulting from the fall in the return on the Livret A passbook. Would you like to know more about the alternatives to regulated savings accounts? Consult our dedicated file without delay:
On February 1, 2022, it should however benefit from a serious boost, thanks to the rise in the rate of the Livret A. It should reach, at a minimum, 2.2%.
LEP interest is calculated fortnightly, on the 1er and the 16th of each month. The date of the value taken into account for the calculation of interest varies according to the date of deposit or withdrawal. Deposits bear interest on your passbook during the following period. In concrete terms, if you make a deposit on your LEP between 1er and on the 15th of the month, interest will be calculated on the 16th of the same month. Conversely, the calculation of interest following a withdrawal takes place over the current period. A withdrawal cancels your interest over the period, for the amount withdrawn from the passbook. The total accumulated interest is added to the capital at the end of the year.
Only persons whose tax residence is located in France can request the opening of a LEP. Only one LEP can be subscribed per person, within the limit of 2 booklets per tax household. Opening a popular passbook is then conditional on the level of income of the subscriber. To open an LEP, your reference tax income must not exceed certain limits, which depend on the composition of your household. Here are the caps that apply this year (tax notice 2021 on 2020 revenue):
- 1 share: €20,296
- 1.5 shares: €25,716
- 2 units: €31,135
- 2.5 units: €36,554
- 3 units: €41,973
- 3.5 shares: €47,392
- 4 shares: €52,811
- Per additional half share: €5,420.
In order to facilitate access to this savings product, Bruno Le Maire had announced a simplification of the opening conditions. “The presentation to your bank of a tax notice at the opening of a LEP will no longer be compulsory“, he explained. “Same for the annual audits. It will be up to the bank to verify the eligibility of the saver with the tax authorities.
The taxation of the LEP is modeled on that of the livret A. Also, the interests produced on the LEP are totally tax-exempt. They are therefore exempt fromincome tax and social levies.