Is it in your best interest to surrender your life insurance or to withdraw your participation?

Reading time:

1 minute

In “Grand meeting of savings” (Capital / Radio Patrimoine), Charlotte Thameur, director of the employee savings offer at Aktier, advises a reader who wonders whether she should invest her profit-sharing bonus or withdraw.

Capital video: Employee savings: should you withdraw your profit sharing or invest it?

Every month the “Savings meeting” (Capital / Radio Patrimoine) answers your questions in the sequence “It concerns you”. Our experts – notary, heritage engineer, employee savings expert – can help you with all your questions, whether they relate to your taxes, your inheritance, your investments, your pension or even your property assets. Here, Charlotte Thameur, director of the employee savings offer at Aktier, informs Vanessa, a reader, who receives a profit-sharing bonus from her company. She wonders whether she should withdraw this amount immediately or place it in her employee savings (a PEE, Company Savings Plan) and in this case make a withdrawal of the same amount from her life insurance instead.

For starters, Charlotte Thameur explains that this decision will depend on the age of Vanessa’s life insurance contract as well as the latter’s marginal tax rate (TMI). One thing is certain: “If Vanessa pays into her employee savings, she will be exempt from income tax”, recalls the expert’s director. However, surrendering the same amount on your life insurance can be tax expensive if the contract is less than 8 years old and is in a capital gain situation: “Vanessa will then have to pay single fixed charge (PFU) 30% on redemption”, specifies Charlotte Thameur. He is therefore advised to carry out a simulation to find out what taxation would apply in the event of an acquisition.

Ask our experts your questions

A question about your investments, an inheritance, your taxes or your real estate investments? Each month we select several and send them to our experts who will educate you on all topics that affect your money. To ask them your questions, an address: grand-rendezvousdelepargne@prismamedia.com