Individual, Collective, and Mandatory PER: The Differences

Since the PACTE law of May 2019, the retirement savings landscape in France has been profoundly reshaped. Gone is the maze of PERP, contrat Madelin, PERCO, and article 83 plans: the Plan d'Epargne Retraite (PER) replaces them all with a unified architecture available in three distinct variants. Each type of PER corresponds to a specific context -- individual subscription, collective setup by the employer, or mandatory enrollment for certain employee categories. Understanding these differences is essential to building a coherent retirement savings strategy, avoiding unpleasant surprises at withdrawal, and making the most of the tax advantages offered by each compartment.

Overview of the Three PER Types

Before diving into the details of each scheme, here is a summary that highlights the main differences between the individual PER, collective PER, and mandatory PER.

This overview shows that the PERIN offers the greatest flexibility, while the PERO imposes the strictest constraints, notably the obligation to withdraw as a life annuity from the mandatory contributions compartment.

The Individual PER (PERIN): The Universal Retirement Savings Tool

Who Can Open a PERIN?

The individual PER is open to any individual, with no conditions regarding age, professional status, or nationality. Private-sector employees, civil servants, self-employed workers, jobseekers, retirees, and even adult students can open a PERIN. This universality is one of the major advances of the PACTE law compared to former schemes, where the PERP was reserved for employees and the contrat Madelin for the self-employed.

The Two Forms of PERIN

The PERIN can take two distinct legal forms:

• The insurance-based PER (the most common): this is a life insurance contract dedicated to retirement, taken out with an insurer or an online broker. It provides access to a guaranteed fonds en euros and a diversified range of unit-linked funds. This is the form chosen by the vast majority of savers, particularly through contracts such as the Linxea Spirit PER (insurer Spirica, management fees of 0.50%), the PER Placement-direct (insurer SwissLife, fees of 0.60%), or the PER Boursorama (insurer Generali, fees of 0.75%).

• The bank-based PER (securities account): opened with a bank or credit institution, it works like a standard securities account. Less common, it does not benefit from the fonds en euros guarantee but may offer direct access to certain individual securities.

Funding Your PERIN: Voluntary Contributions

The PERIN is funded exclusively through voluntary contributions. You are free to choose the amount, frequency, and timing of your payments. There is no contribution ceiling per se, but the tax deduction ceiling limits the amount you can deduct from your taxable income. In 2026, this ceiling ranges between 4,636 euros (floor) and 37,094 euros (cap), depending on your net professional income. The PASS (Plafond Annuel de la Securite Sociale) for 2026 is set at 46,368 euros.

You can opt for scheduled contributions (monthly, quarterly) to spread your savings effort, or make one-off contributions at year-end to fine-tune your tax deduction. Combining both approaches is often the most effective strategy.

The Tax Advantage of the PERIN

Voluntary contributions to a PERIN are deductible from taxable income. The tax saving depends directly on your marginal tax rate (TMI, taux marginal d'imposition). The higher your TMI, the more substantial the benefit.

PERIN Withdrawal Options

At retirement age (64 for those born after 1968), Laurent can choose between three withdrawal methods:

• Lump-sum withdrawal: all at once or in installments. The capital corresponding to deducted contributions is subject to the progressive income tax scale. Capital gains are taxed at the 30% PFU (flat tax).
• Life annuity: the annuity is taxed as a retirement pension, with a 10% allowance capped at 4,321 euros in 2026.
• Capital and annuity mix: combining both options, securing regular income while having capital available for specific projects.

The Six Early Withdrawal Cases

One of the major advantages of the PER compared to former schemes is the ability to unlock funds before retirement in six specific situations:

1. Purchase of a primary residence -- this is the most commonly used case and a genuine innovation of the PER compared to the PERP.
2. Disability of the holder, their spouse, or a dependent child.
3. Death of the spouse or civil union (PACS) partner.
4. Expiration of unemployment benefits.
5. Over-indebtedness situation.
6. Cessation of self-employed activity following court-ordered liquidation.

The Collective Company PER (PERECO): The Employee Savings Lever

Who Is Concerned by the PERECO?

The PERECO is set up by the company for all of its employees. Its implementation is optional for the employer, except in certain specific cases: since 2022, any company with a profit-sharing agreement but no PEE or PERCO must offer a collective retirement savings plan. The PERECO replaces the former PERCO.

The employee has no steps to take: the company designates a manager (insurer, bank) and the contract is opened automatically for all eligible employees.

The Five Funding Sources of the PERECO

The PERECO stands out from the PERIN through the diversity of its funding sources:

1. Interessement (profit-sharing): a share of results or performance redistributed to employees under a company agreement.
2. Participation (mandatory profit-sharing): compulsory redistribution of profits in companies with 50 or more employees.
3. CET days (Compte Epargne Temps, time savings account): transfer of up to 10 days per year.
4. Voluntary contributions from the employee, subject to the same deduction rules as the PERIN.
5. Employer matching (abondement): a top-up paid by the company, capped at 7,418 euros gross in 2026 (16% of PASS).

Employer Matching: The True Strength of the PERECO

Employer matching is the feature that makes the PERECO particularly attractive. It is a top-up paid by the employer proportionally to the employee's contributions. A 300% matching rate means that for every euro contributed by the employee, the employer adds three euros. This is literally free money from the company, exempt from standard social contributions (subject only to the 16% forfait social for the employer in certain cases).

PERECO-Specific Taxation

PERECO taxation varies depending on the funding source. Interessement and participation paid into the PER are exempt from income tax at entry (but subject to CSG-CRDS). Employer matching is directly exempt for the employee. Voluntary contributions follow the same rules as the PERIN, with the choice between deduction or non-deduction.

At exit, capital from employee savings (compartment 2) benefits from favorable tax treatment: only gains are subject to the 17.2% social contributions, while the capital itself is exempt from income tax.

PERECO Transferability

An employee who leaves the company can transfer their PERECO to another PERECO at their new employer or to an individual PERIN. Transfer fees are capped at 1% of the balance if the PER is less than 5 years old, and are free beyond that. During employment with the company, a transfer to a PERIN is possible every 3 years.

The Mandatory PER (PERO): Employer-Imposed Contributions

The PERO Framework

The mandatory PER (PERO) replaces the former article 83 contract. It is set up by the company for an objectively defined category of employees, most often executives or senior managers. Enrollment is mandatory for the employees concerned: it is impossible to refuse participation.

PERO Funding Sources

The PERO is primarily funded by mandatory contributions, split between employer and employee according to the terms of the company agreement. For example, the agreement may provide for a total contribution of 4% of gross salary, with 2.5% borne by the employer and 1.5% by the employee.

In addition, the employee may make voluntary contributions (compartment 1) and receive interessement or participation (compartment 2).

The Major Constraint of Compartment 3

This is the key point to remember: amounts from mandatory contributions, held in compartment 3, can only be withdrawn as a life annuity. No lump-sum withdrawal is possible from this compartment. Furthermore, early withdrawal for primary residence purchase does not apply to compartment 3. Only the five life-accident cases allow early access before retirement.

This constraint makes the PERO less flexible than the PERIN or PERECO. However, the employer-funded portion represents a significant benefit in kind, and the life annuity guarantees lifetime income, providing valuable security for retirement.

Taxation of Mandatory Contributions

At entry, employer contributions are exempt from income tax within certain limits (8% of gross annual remuneration, capped at 8 PASS). Mandatory employee contributions are deductible from taxable income. At exit, the annuity is taxed on the progressive income tax scale after the 10% allowance applicable to retirement pensions (capped at 4,321 euros in 2026).

The Three PER Compartments: The Key to Exit Taxation

Regardless of the PER type held, funds are allocated across three compartments that determine the withdrawal rules and applicable taxation. This compartment architecture is fundamental and persists even when transferring from one PER to another.

Compartment 1: Voluntary Contributions

This compartment receives all contributions made at the holder's initiative. Withdrawal is available as lump sum, annuity, or both. Early withdrawal is permitted in the six cases provided by law, including primary residence purchase. Exit taxation for lump-sum withdrawal: income tax on the capital if contributions were deducted, 30% PFU on capital gains.

Compartment 2: Employee Savings

This compartment receives interessement, participation, employer matching, and CET days. Withdrawal is available as lump sum or annuity. Early withdrawal is permitted in the six cases, including primary residence purchase. Favorable exit taxation for lump-sum withdrawal: capital is exempt from income tax, only gains bear the 17.2% social contributions.

Compartment 3: Mandatory Contributions

This compartment receives only mandatory employer and employee contributions. Withdrawal must be as a life annuity. Early withdrawal is limited to the five life-accident cases (no withdrawal for primary residence purchase). The annuity is taxed as a retirement pension.

What Strategy to Adopt Based on Your Situation

Employee Without Employee Savings

If your company offers no interessement, participation, or PERECO, the PERIN is your only tax-advantaged retirement savings tool. Choose a low-fee online contract: the Linxea Spirit PER (0.50% management fees, 700 unit-linked funds and 80 ETFs) or the PER Placement-direct (0.60%, 1,000 unit-linked funds) are the market leaders. The PERIN is most beneficial if your TMI is 30% or above and you anticipate a significant drop in retirement.

Employee With Employee Savings and Matching

This is the most favorable situation. The optimal strategy follows a clear order of priority:

1. Maximize employer matching in the PERECO by contributing the minimum needed to trigger the maximum match.
2. Direct interessement and participation into the PERECO to benefit from income tax exemption at entry.
3. Supplement with an individual PERIN to use your remaining tax deduction ceiling.

Self-Employed Worker (TNS)

Self-employed workers (travailleurs non salaries) benefit from a significantly higher PER deduction ceiling than employees, thanks to the two-tier calculation: 10% of taxable business income (capped at 8 PASS) + 15% of the portion of income between 1 and 8 PASS. The theoretical maximum ceiling reaches approximately 85,780 euros in 2026. The PERIN is therefore a particularly powerful tax-reduction tool for liberal professionals, traders, and craftspeople with high incomes.

Couple with Different Professional Situations

For a married or civil-union couple filing jointly, pooling deduction ceilings (box 6QR on the tax return) is an essential strategy. It allows the spouse with the higher TMI to use the unused ceiling of the other.

Transferring Former Contracts to a PER

If you still hold former retirement savings products, transferring them to a PER is not only possible but often recommended. The transfer allows you to consolidate your holdings, simplify management, and benefit from PER flexibility (lump-sum withdrawal, primary residence unlock).

Transferring a PERP or contrat Madelin to a PERIN is done without conditions and preserves the tax history. No taxation is triggered by the transfer itself. Transferring a PERCO to a PERECO or PERIN is also free.

The case of transferring from a life insurance contract is different: it is not a transfer per se but rather a withdrawal from the life insurance (taxable under life insurance rules) followed by a contribution to the PER (deductible). This operation can be advantageous near the end of a career to "convert" a tax benefit, particularly for contracts older than 8 years that benefit from a doubled allowance (9,200 euros for a single person, 18,400 euros for a couple) when the PER contribution occurs at least 5 years before retirement.

Conclusion

The three types of PER -- individual, collective, and mandatory -- form a complementary ecosystem serving retirement preparation. The PERIN is the universal tax deduction tool, accessible to all and offering great management freedom. The PERECO allows you to capitalize on employee savings and especially on employer matching, which represents an unparalleled financial advantage. The PERO, though more constraining with its mandatory annuity exit on compartment 3, provides a retirement supplement partly funded by the employer. The optimal strategy most often involves combining these schemes -- maximizing PERECO matching first, then supplementing with a low-fee online PERIN -- while keeping in mind the exit rules specific to each compartment.

The information presented is for informational purposes and does not constitute investment advice. PER taxation is complex and depends on your personal situation. Consult an advisor for a personalized analysis. Sources: loi PACTE n°2019-486, Code monetaire et financier, BOFiP.