PER Tax Deduction Simulator

Voluntary contributions to a PER are deductible from taxable income, within the limit of your available ceiling.

Formula: Tax savings = Deductible amount x MTR

The annual deduction ceiling is the higher of:

• 10% of net professional income from year N-1 (capped at 10% of 8 PASS = 35,194 EUR in 2026)
• 10% of PASS (4,636 EUR in 2026, minimum floor for everyone)

Unused ceilings from the 3 preceding years carry forward and are cumulative. Your total available ceiling appears on your tax notice.

The tax deduction is the main advantage of the PER and the reason this product is particularly attractive for taxpayers in the higher brackets. Understanding its mechanism in detail allows you to considerably optimize the tax savings achieved.

The detailed mechanism of the deduction

The mechanism works as follows: each euro contributed to your PER is deducted from your taxable income. The tax savings generated equals the contribution amount multiplied by your marginal tax rate (MTR).

Tax savings = Deductible contribution x MTR

Concretely, if your MTR is 30% and you contribute 5,000 euros to your PER, your taxable income decreases by 5,000 euros, reducing your tax by 5,000 x 30% = 1,500 euros. The actual cost of your contribution is therefore only 3,500 euros for 5,000 euros saved.

The higher your MTR, the greater the advantage:

• MTR at 11%: for 5,000 euros contributed, savings of 550 euros (actual cost: 4,450 euros)
• MTR at 30%: for 5,000 euros contributed, savings of 1,500 euros (actual cost: 3,500 euros)
• MTR at 41%: for 5,000 euros contributed, savings of 2,050 euros (actual cost: 2,950 euros)
• MTR at 45%: for 5,000 euros contributed, savings of 2,250 euros (actual cost: 2,750 euros)

Deduction ceilings in 2026

Deductible contributions are capped. The annual ceiling is the higher of:

• 10% of net professional income from year N-1, capped at 10% of 8 times the Annual Social Security Ceiling (PASS), i.e. a maximum of 35,194 euros in 2026
• 10% of PASS, i.e. a floor of 4,399 euros in 2026, accessible to everyone including those without professional income

For an employee earning 50,000 euros net taxable income, the ceiling is 10% x 50,000 = 5,000 euros. For a senior executive at 120,000 euros, the ceiling is 12,000 euros. Above 351,936 euros in income, the ceiling is capped at 35,194 euros.

Carryover of unused ceilings

An often overlooked advantage: unused deduction ceilings from the three preceding years (N-3, N-2, N-1) carry forward. This means that if you have not contributed to a PER (or a former PERP/Madelin) in previous years, you can cumulate these ceilings and make a much larger exceptional contribution.

Example: an employee with an annual ceiling of 5,000 euros who has never contributed to a PER potentially has a cumulative ceiling of 5,000 x 4 (current year + 3 years of carryover) = 20,000 euros. They can make a single contribution of 20,000 euros, fully deductible, and save 20,000 x 30% = 6,000 euros in tax in a single year.

Pooling ceilings for couples

Married couples or civil partners filing jointly can pool their deduction ceilings. This means one spouse can use the other's unused ceiling by checking the appropriate box on the tax return (box 6QR).

Example for a couple: Marc (41% MTR, available ceiling 8,000 euros) and Julie (11% MTR, available ceiling 6,000 euros). By pooling, Marc can contribute up to 14,000 euros to his PER and deduct the full amount. Tax savings: 14,000 x 41% = 5,740 euros. If Julie had contributed her own 6,000 euros, the savings would have been only 6,000 x 11% = 660 euros. Pooling in favor of the higher-taxed spouse generated 5,080 euros in additional savings.

Beyond regular contributions, several advanced strategies allow you to make the most of the PER's tax advantage. These techniques are particularly relevant for taxpayers in the 30%, 41% or 45% brackets, for whom tax optimization represents significant amounts.

Strategy 1: Year-end exceptional contribution

Year-end is the ideal time to adjust your PER contribution. In November or December, you know your income for the year precisely and can calculate the optimal amount to contribute to maximize your tax savings without exceeding your ceiling.

Tip: if your income has been exceptionally high (bonus, overtime), a year-end contribution reduces the tax impact immediately. For example, a 10,000 euro bonus taxed at 41% generates 4,100 euros in tax. By contributing 10,000 euros to your PER (within the ceiling), you recover 4,100 euros and the bonus is entirely saved for your retirement, net of tax.

Strategy 2: Smoothing exceptional income

The PER is a powerful tool for fiscally smoothing exceptional income. In case of a large bonus, departure indemnity, real estate capital gain, or any one-off income that would push you into a higher tax bracket, a PER contribution can mitigate the tax shock.

Example: an employee with usual income of 45,000 euros (30% MTR) receives an exceptional bonus of 20,000 euros, bringing their income to 65,000 euros. Without action, part of this bonus would be taxed at 41%. By contributing 15,000 euros to their PER (within available ceiling), they bring their taxable income back to 50,000 euros and stay in the 30% bracket. The tax saving can reach 4,500 to 6,000 euros depending on the exact situation.

Strategy 3: Coordinating individual PER and company PER

If your employer offers a collective company PER (PERECO), you can combine the advantages of both wrappers. Voluntary contributions to the PERECO share the same deduction ceiling as the individual PER. However, profit-sharing and incentive contributions to the PERECO are not deductible from taxable income but benefit from income tax exemption (and partially from social contribution exemption) within certain limits.

The optimal strategy consists of:

• Placing profit-sharing and incentive payments into the PERECO (income tax exemption + potential employer matching)
• Making deductible voluntary contributions to the individual PER (generally lower fees and better fund selection)
• Verifying that total deductible contributions do not exceed your overall ceiling

Important consideration: the exit MTR

The PER's tax advantage is not a gift: it is a tax deferral. The deductible capital contributed will be taxed at the income tax scale upon exit (as a lump sum or annuity). The actual advantage therefore depends on the difference between your current MTR and your MTR at retirement.

Favorable case: you are at 41% today and will be at 11% or 30% at retirement. The 11 to 30-point gap represents a significant net gain.

Unfavorable case: you are at 30% today and will also be at 30% at retirement (high income, significant wealth). In this case, the advantage is limited to the cash flow benefit (you pay the tax later) and the returns generated by the tax savings in the meantime.

Case to avoid: if your MTR is 11% today, the tax deduction is small. It may be preferable to waive the deduction (checkbox when making the contribution) to benefit from a lower-taxed exit. In this case, only the gains will be taxed at exit, not the capital.

The effectiveness of the PER tax deduction varies considerably depending on your marginal tax rate. To make the most of this scheme, you should adapt the amount and timing of your contributions to your tax profile, taking into account all your deductions and their impact on your reference tax income.

Adapting contributions to your marginal bracket

The PER is more advantageous the higher your MTR. At 45%, each euro contributed generates 45 cents in tax savings. At 11%, the benefit is only 11 cents. This is why it is often recommended to concentrate PER contributions in years when your MTR is highest. If you anticipate an income variation (end of career, part-time transition, sabbatical), it may be optimal to contribute more during high-tax years and reduce or suspend contributions during low-MTR years. For taxpayers who oscillate between two brackets, a contribution calibrated to stay just below the threshold of the higher bracket maximizes the savings on every euro contributed.

Combining with other deductions and tax credits

The PER deduction combines without restriction with other charges deductible from taxable income (alimony, property deficits, deductible CSG). However, it does not compete with the overall ceiling on tax incentives of 10,000 euros per year, because the PER deduction is not a tax credit but a deduction from taxable income, which places it outside the tax incentive ceiling. This distinction is fundamental: a taxpayer can benefit from 10,000 euros in tax credits (home employment, donations, Pinel rental investment) and additionally deduct their PER contributions from their taxable income. The PER therefore constitutes an additional tax reduction tool, without competing with other schemes.

The impact on reference tax income (RFR)

An often overlooked effect of the PER deduction is its impact on your reference tax income (RFR). The RFR serves as the basis for many benefits and exemptions: property tax exemption, student scholarships, LEP eligibility, residence tax allowance (secondary residences), school canteen contributions, and even the calculation of certain social benefits (housing aid, back-to-school allowance). By reducing your taxable income, PER contributions automatically lower your RFR, which may qualify you for benefits you would not otherwise be entitled to. For a household near an eligibility threshold, a well-calibrated PER contribution can generate an additional indirect benefit exceeding the tax savings itself. It is therefore essential to incorporate this effect into your overall analysis to determine the optimal amount to contribute each year.