Company Savings Plan (PEE)

Verified 25 July 2024 - Directorate for Legal and Administrative Information (Prime Minister)

The company Savings Plan (PEE) is a collective savings scheme that allows employees (and managers of small companies) to make investments with the help of the company and a tax advantage. The amounts invested in the EEP are unavailable for 5 years, but there are cases of early release. Here are the applicable rules.

One PEE: titleContent is a collective savings product that enables employees of a company to build up a portfolio of transferable securities.

The EEP may be implemented at the level of a company.

It can also be set up in a group of companies, then we speak of PEG: titleContent.

It can also be implemented in several companies not belonging to the same group, then referred to as (PEI: titleContent).

PEG and IEP function like the EEP.

If the company has set up an EEP, it must be open to all employees. However, a seniority condition may be required (maximum 3 months).

In the event of termination of the employment contract (resignation, dismissal, retirement, early retirement...), the employee may retain his EPE under certain conditions.

If the number of employees of the company does not exceed 250, its manager can also benefit from the EPE, regardless of his status. The manager's spouse or Civil partnership partner may also be eligible for the EAP if he or she is a working or associate spouse.

Which employer should set up the EEP?

The implementation of the PEE: titleContent is optional for companies.

But when there is a participation agreement within a company, the implementation of the EAP becomes mandatory.

How should the agreement be drawn up?

The EPE is set up by a concerted decision between the Head of company and the employees in the following cases:

  • Agreement between the Head of company and the employees' representatives
  • Agreement within the Social and Economic Committee (ESC)
  • Approval of a branch agreement by two-thirds of employees.

The EAP is set up by a decision of the Head of company when negotiations with the staff representatives have failed.

What should be in the agreement to set up the EAP?

The agreement must contain elements enabling the employee to understand how the sum due to him is calculated and when he can benefit from it.

These are:

  • Date of conclusion, effective date and duration for which the agreement is concluded
  • Scope of the plan (list of companies, sectors concerned)
  • Duration of the plan (fixed or indefinite duration) and conditions for revision
  • Seniority requirements
  • Plan Power Sources
  • Details of the company aid
  • Different investment formulas
  • Duration of unavailability of beneficiaries' rights and cases of early release
  • Nature and method of managing beneficiaries' rights.

Mandatory Deposit

The agreement chosen by the company with or without consultation with the employees or their representatives must be deposited on the website of the Ministry of Labor:

TeleAccords, company Collective Agreement Filing Service

Checks

Since 1er september 2021, wage savings agreements filed by companies are subject to two types of control: a formal control and a substantive control.

Shape control

The form check is carried out by the DDETS: titleContent competent for the seat of the company.

This check is used to verify whether the company has deposited the agreement in the required format and whether it has complied with the rules for negotiating, denouncing and reviewing wage savings agreements.

The DDETS must take its decision within one month.

It may decide to issue the receipt or to request additional documents from the company.

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The receipt shall be issued

The DDETS must immediately forward the agreement to the social security collection agency on which the company depends.

The receipt is not issued

The situation varies depending on whether the DDETS requests additional documents or not:

Additional documents are requested

The DDETS must forward the agreement to the social security collection agency on which the company depends within one month.

No request for additional documents

The DDETS may transmit the agreement to the collection fund on which the company depends after the one-month period.

Substantive control

Substantive control is carried out by the social security collection agency on which the company which has lodged the agreement depends.

The purpose of this review is to verify whether the clauses of the agreement submitted comply with the law.

The recovery agency has 3 months to request the amendment of the provisions of the agreement which are contrary to the law.

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Request for change made

If the recovery agency requests the amendment of certain clauses within the three-month period, the company must make the amendments before it can benefit from the agreement.

No change request

If the recovery agency does not request any changes within the three-month period, the company may benefit from the social and fiscal advantages of the agreement for the current accounting year.

When hiring, the employer must give the employee a payroll savings book indicating the arrangements put in place in the company.

If the company has set up an EAP, it must provide the employee with a settlement informing him of the plan and its content.

At least once a year, the company must provide the employee with a status report.

This statement shall include the estimate of the value of its PEE portfolio as at 31 December of the previous year.

It must also show the payments and withdrawals made during the previous period.

When the employee leaves the company, he must receive a summary statement of all the sums and securities saved or transferred. If he wishes to continue to benefit from the plan, he will have to pay a custody account keeping. The company may also decide to bear these costs. The summary statement given when the employee leaves the company must specify whether the expenses are covered by the company or by deduction from your assets.

Employee Payments

Payments are optional.

The employee may contribute to his EAP with the following amounts:

Voluntary payments are capped. The employee may pay each calendar year not more than 25 % of his gross annual remuneration.

The EAP Regulation may provide for a minimum annual payment of €160 at most.

Whether the payments are intended to feed an FCPE specially dedicated to the takeover of your company, they can then reach your entire annual remuneration.

Additional company payments (abundances)

The EEP may be financed by company payments which supplement employees' payments.

These additional company payments are called abundances.

The abundance may not exceed 3 times the amount paid by the employee, nor exceed €3,709.44.

If the employee invests in shares or investment certificates issued by the company or a linked company, the abundance may be up to €6,676.99.

FYI  

When a company of 50 or more employees makes a supplementary payment, it must pay a special contribution, called social package.

Voluntary company payments

The company may also make payments to the EEP, even in the absence of payments from employees.

These voluntary payments are intended exclusively for the purchase of shares or investment certificates issued by the company or by a company of the same group.

Where the company makes voluntary payments to purchase its own shares or investment certificates, its overall limit on abundance shall be increased from €3,709.44 to €7,418.88.

The EEP may be financed by company payments which supplement employees' payments.

These additional company payments are called abundances.

If the employee invests in shares or investment certificates issued by the company or a linked company, the abundance may be up to €6,676.99.

Allocation of funds

The amounts paid out of the EEP may be invested in the company's shares, in shares of Sicav: titleContent or in FCPE. CEPAs may include shares of the EAP's founding company, even if it is a cooperative.

Part of the amounts paid out of the EEP must be invested in the shares of socially useful solidarity companies.

FYI  

A FCPE may be specifically dedicated to the takeover of the company by employees.

The amounts invested in the EEP are blocked for at least 5 years.

However, the employee may request the early release of the sums in certain cases.

The cases in which the employee can request early release are as follows:

  • Marriage, Civil partnership
  • Birth or adoption of a 3e child
  • Divorce, separation, dissolution of a Civil partnership, with the custody of at least one child
  • Victim of intimate partner violence
  • Disability (employee, spouse or Civil partnership partner, children)
  • Death (employee, spouse or Civil partnership partner)
  • Termination of employment contract, cessation of activity by individual contractor, termination of employment, loss of status as collaborating spouse or partner spouse
  • Creation or takeover of a company by the holder, or his or her spouse or Civil partnership partner, pursuit of another self-employed profession, acquisition of shares in a cooperative production business (SCOP)
  • Acquisition or expansion of the main residence, with the creation of a new living space and in the presence of a building permit or a preliminary work declaration
  • Rehabilitation of the main residence damaged as a result of a natural disaster recognized by Ministerial Order
  • Renovation of the energy of the main residence
  • Over-indebtedness
  • Caregiving activity performed by the holder, or his or her spouse or Civil partnership partner
  • Purchase of a low greenhouse gas emission vehicle (car, van, 2- or 3-wheel motor vehicle, or motor quadricycle that uses electricity, hydrogen or a combination of both as its exclusive source of energy, or new pedaling power cycle).

The request for early release must be made within 6 months of the event.

However, it may intervene at any time in the following cases:

  • Termination of employment contract
  • Death
  • Disability
  • Domestic Violence
  • Over-indebtedness
  • Caregiver activity.

The employee must apply to the organization that manages the PEE: titleContent on behalf of his company.

Attach the proof of the event allowing the early release.

Behold, by way of indication, the types of evidence which may be submitted in support of the application:

  • Marriage : extract from the marriage certificate or family record book
  • Civil partnerships : certificate of the registrar of the court of first instance which registered the Civil partnerships, birth certificate containing the transcript of the Civil partnerships, notarial certificate
  • Birth of a 3e child : family record or birth certificate or certificate of birth Caf: titleContent justifying the existence of 3 dependent children
  • Adoption of a 3e child : certificate from the department for the adoption of the child or extract from the birth certificate or family record book and certificate from the FAC
  • Divorce with custody of at least one child : divorce decree providing for the fixing of the habitual residence of at least one child at the employee’s domicile + no-appeal or no-appeal certificate or birth certificate with mention of the divorce
  • Separation with custody of at least one child : court decision establishing the habitual residence of at least one child in the employee’s home
  • Dissolution of a Civil partnership with the custody of at least one child : Birth certificate with a modification of the Civil partnerships and court decision providing for the habitual residence of at least one child in the employee’s home
  • Domestic Violence indictment :: protection order issued by the judge in family cases or other document proving the consideration of the case by the criminal justice system (opening of a judicial inquiry, offering of the alleged perpetrator, proposing a criminal composition to the alleged perpetrator, referring him to the correctional court or sentencing him)
  • Disability (of the employee or his or her spouse, Civil partnership partner, or children): certificate of invalidity of a social security or pension body (or decision of a body responsible for disabled persons) and invalidity card
  • Death (of employee or spouse): death certificate or notoriety certificate + certificate of heredity
  • Death (of employee or Civil partnership partner): death certificate and family record or birth certificate with mention of death
  • Termination of employment contract (dismissal, resignation) : certificate of employment, certificate from the employer confirming the date of termination of the contract or retirement
  • Termination of the activity of a sole trader : certificate of cessation of activity by the Urssaf
  • End of social mandate : minutes of revocation or non-renewal of the mandate
  • End of worker spouse status : copy of the declaration of deregistration sent by the Head of company to the companies National Register (RNE) + notification by the RNE of receipt of the declaration of deregistration
  • End of associate spouse status : notification of the amendment of the company’s statutes and receipt from the NNE
  • Over-indebtedness : request of the chairman of the debt relief commission or order of the judge indicating the amount to be released
  • Creating or Resuming company : receipt of registration in the National Register of companies (RNE) plus the statutes
  • Installation for the exercise of a self-employed profession : professional certificate bearing the approval number or receipt of registration to the NNE
  • Acquisition of shares in a cooperative production business (SCOP) : articles of association of the cooperative business
  • Main residence (purchase in the old) : compromise of sale or notarial deed of sale with declaration on the honor to return the amount released in case of non-purchase
  • Principal residence (construction by employee) : building permit and wholesale materials purchase invoice or estimate accepted with deposit
  • Principal residence (purchase in future state of completion) : sales contract
  • Main residence (extension) : building permit or prior declaration of works to the town hall
  • Principal residence (rehabilitation work after natural disaster) : reference of the prefectural decree and declaration of claim with the insurance company or insurance expert with the quote accepted

The EAP taxation is not the same during the life of the plan and during the unblocking.

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During the life of the plan

Taxation varies depending on the nature of the amounts paid to the EEP.

Abundance paid by the company

The abundance paid by the company is exempt from income tax for the employee, up to €3,709.44.

This ceiling shall be increased to €6,676.99 in the case of investment in shares or investment certificates issued by the company.

But abundance is subject to the CSG (generalized social contribution) and the CRDS (contribution to the repayment of social debt).

Employee interest

The company’s profit-sharing interest, which the employee deposits on his EAP, is exempt from income tax, up to €34,776.

Voluntary payments by the employee

Voluntary payments made by the employee to the EEP are not deductible from his taxable income.

Income from securities held in the plan
Income from securities reinvested in the plan

Interest generated by the securities held in the plan is exempt from income tax when the employee reinvests them in the plan. They shall be subject to social security contributions.

Income from securities not reinvested in the plan

The interest generated by the securities held in the plan is subject to income tax and social security contributions if the employee does not reinvest them in the plan.

Savings in the plan

Profits generated by the sale of securities under the EAP are exempt from income tax, but subject to social security contributions.

On early release

The sums withdrawn from the plan correspond to the employer's and employee's payments and to the income generated by the plan which has been reinvested by the employee.

These amounts are exempt from income tax, but are subject to social security contributions for the part corresponding to the income generated by the plan.

At the end of the plan

The sums withdrawn from the plan correspond to the employer's and employee's payments and to the income generated by the plan which has been reinvested by the employee.

These amounts are exempt from income tax, but are subject to social security contributions for the part corresponding to the income generated by the plan.