The accumulation of employment-retirement is one of the important pension reform systems. During a webinar organized by Absoluce in partnership with Factorielles, company specializing in social protection advice for business leaders, Experts from Absolutece explained the different possibilities available to employees and business leaders.
The employment rate of seniors in France is 33%, while it is 45% in the European Union, up to 60% in Germany and Sweden ! Even if it is expected that around 2030 the employment rate of French seniors should rise to 40%, it will therefore still remain much lower than that of our neighbors. Combining employment and retirement allows an employee or business manager to continue working while receiving their retirement.. And, at a time, the idea was that we had to leave room for young people, today the opposite, everything is done to encourage seniors to continue working. The recent pension reform facilitates this system. But beware, rules are imposed according to the different cases. Six out of ten retirees who have combined employment and retirement are 65 or over, and 150,000 additional files for a second retirement liquidation must be processed each year.
The different possible devices
The two main systems are progressive retirement and cumulative employment-retirement. In France, Only 23,000 people chose gradual retirement. This device, yet very interesting, is not popular with the French. On the other hand, 500,000 people benefit from combined employment and retirement. The combination of employment and retirement is available in two systems :
– liberalized employment-retirement combination (integral). In this case, income from resumed or continued activity can be fully combined with old age pensions ;
– capped employment-retirement accumulation. In this case, it is necessary to cap your income if you want to combine employment and retirement.
Conditions of access to liberalized employment-retirement combination
To benefit from liberalized employment-retirement combination, four cumulative conditions are required : 1) the minimum legal age, between 62 years and 64 years, must be achieved. This therefore excludes people who retire early. ; 2) you must benefit from the full rate : either the required insurance period, i.e. the automatic age of 67 ; 3) all pensions must be liquidated at the same time : basic pensions, supplementary pensions (except certain supplementary plans for most liberal professions), national pensions and international pensions (except exceptions) ; 4) finally, for employees only, you must have stopped the previous activity. If only one of these conditions is not met, the retiree will automatically switch to the capped employment-retirement regime.
The conditions to be respected for capped employee employment-retirement combination
Three conditions must be respected : 1) compliance with the ceiling for the basic regime ; 2) compliance with the specific Agirc-Arrco ceiling ; 3) compliance with a six-month waiting period in the event of resumption of activity for the same employer (for the basic diet). In case of non-compliance with the waiting period, the sanction is the suspension of the pension ; and in the event of non-compliance with the ceiling, the basic plan pension is capped, and the Agirc-Arrco pension is suspended. The basis for calculating the ceiling is made up of income subject to CSG to which gross pensions are added. (basics and complementary). Ensuite, two limits are possible : or the average of the last three months of salaried activity, i.e. 160% of the minimum wage based on 1,820 hours per year. And it is the most favorable solution that applies. The “normal salary” does not take into account the sums paid upon departure from the company (retirement benefits, severance pay, etc.). Likewise, sums not included in usual remuneration (incentive bonuses and others) must not be taken into account as salary for the new activity. This will always involve carrying out an analysis by regime, then by level ; indeed, the rules for supplementary plans are sometimes different from those for basic plans…
Other solutions exist
A person who has not yet fulfilled the conditions to benefit from liberalized employment-retirement combination and for whom capped employment-retirement combination presents other disadvantages (such as, For example, suspension of supplementary pension) can find other solutions. Resumption of temporary work allows you to return to work immediately, by neutralizing the six-month waiting period. On the other hand, contributions do not produce rights (no second pension possible), and compliance with the income ceiling still applies. Without forgetting the fact that this status costs more for the company which will have to pay the temp company. Changing status is another solution. A person who has been an employee can set up as a freelancer. In this case also, she can immediately return to work without a waiting period, and can fully combine his work income with his pensions. On the other hand, her contributions do not produce rights as long as she does not meet the conditions for liberalized employment-retirement combination. Finally, gradual retirement allows you to accumulate part-time work while retaining the benefit of part of your retirement pension.
Phased retirement is under-exploited
To make it more attractive, this system was open to executives on a day package and to corporate officers, and the reform has more recently extended it to the liberal professions (including lawyers). Four conditions must be met to benefit from it : apply for an eligible plan (salaries, craftsmen and traders, farmers, civil servants, liberal professions under the CNAVPL and lawyers) ; have reached the minimum age of 62 years (who was previously 60 years old) ; total at least 150 quarters ; and reduce your activity and income in certain proportions. The advantages are numerous : gradual retirement allows you to leave smoothly ; no six-month waiting period, even if the person works for the same employer ; possible premium ; contributions productive of rights and possibility of contributing full time. Furthermore, the employer’s refusal is regulated.
Several measures can help optimize your retirement
An employee can absolutely, For example, opt for progressive retirement while waiting to trigger liberalized employment-retirement combination. He will be able to, during the period of liberalized employment-retirement combination, generate new retirement rights as part of a second liquidation. But of course, he will only be able to receive his end-of-career compensation once... In all cases, combining employment and retirement is a particularly interesting system, but it is strongly recommended to call on your accountant or other advisors to avoid making errors and to optimize the system.
HOW DOES LIBERALIZED EMPLOYMENT AND RETIREMENT CUMULATION WORK FOR ARTISANS TRADERS? ?
To benefit from it, the minimum legal age must be reached (between 62 and 64 years old), as well as the full rate (duration of insurance or automatic age of 67), and all pensions must be liquidated.
In the event that all of these conditions are not met, particular attention must be paid to the risk of a reduced pension resulting in a capping of income. The case arose of a manager who paid himself dividends and was asked for a reimbursement from his fund which considered that he had exceeded the authorized income... So be careful, in terms of capped employment-retirement accumulation, nothing is fixed. All changes in financial situation must give rise to an assessment of their impacts. Concerning the presidents of SAS : the assimilated salaried manager holding a paid corporate office must resign from his office to meet the need to cease all activity to benefit from combined employment and retirement. And only then can he get renamed.
Cessation and resumption of activity
Attention, unpaid SAS presidents have every interest in doing the same. Indeed, some received a notification from their fund which stipulated : “Under current regulations, retirement service is subject to a condition of cessation of activity, even unpaid. » How to concretely prove the cessation of activity ? Even if the CNAV requests a simple declaration on honor, in practice, to protect yourself, it may be prudent to be able to present minutes of the meeting recording the resignation as part of retirement, as well as a pay slip with the mention “end of contract” and a date of departure from the company’s workforce if there is an employment contract. If the conditions for liberalized employment-retirement combination are met, the president of SAS may, when he resumes his activity, either get paid, in which case he will pay contributions producing rights, or be remunerated only in dividends.
