Individual pension commitment - IPC

An individual pension commitment (IPC) is a life insurance policy that provides supplementary pension capital for company directors through their companies. By taking out an EIP insurance, you are the owner of the policy and benefit from very favourable tax treatment. Your company pays the premiums, which are fully deductible provided the 80% rule is respected. This life insurance can benefit the company director or the employees. Moreover, it is possible to combine an EIP with a group insurance and a supplementary free pension for the self-employed (SPAS).

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If you are a company director and want to build up your supplementary pension, the individual pension commitment is a very good choice. Your company can take out an EIP insurance policy for you if you receive a regular monthly salary. In addition, you can combine your EIP with a VSPSS pension plan. In this way, you can benefit from numerous tax advantages:

1. Invest in real estate projects
2. The premiums paid by your company are 100% deductible as business expenses
3. Benefit from additional protections to reduce the overall tax burden and meet your specific needs
   
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Following the law of 18 December 2015, workers are obliged to liquidate their supplementary pension capital when they take their early retirement pension.

If you remain active until the age at which you meet the conditions for a full career (65 years now, 66 years from 2025 onwards), your supplementary pension capital (EIP) will be taxed at the preferential tax rate of 10%, even if you liquidate it before your 65th birthday. The points of attention are therefore:

1. You must prove a full career of 45 years ( mypension )
2. You must remain active during the last 3 years before the 45-year career
3. The reduced tax rate of 10% is not applicable in the case of early retirement
   
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In the first place, the VSPSS is the independent 3rd pillar pension contract that offers the best tax leverage. It is therefore generally a priority contract when setting up 2nd pillar insurance. The VSPSS is often supplemented by an EIP or a SPAS.

1. The VSPSS contract is more advantageous because it is not subject to the 4.40% tax (this provides tax deductibility at marginal tax rates and a reduction in self-employed social security contributions)
2. The taxation of the capital at term is diluted over 10 years
3. The choice between an EIP and a SPAS insurance depends on your situation as a self-employed person (company director or self-employed person in natural person)
   
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The individual pension commitment is a particularly interesting life insurance contract. The taxation of an IPC depends on your retirement age and your tax advantages as a company director are as follows:

1. The premiums paid by your company are fully deductible if the 80% rule is respected. This rule defines the maximum premium your company can deduct (it cannot exceed 80% of your statutory and non-statutory pension).
2. The sums paid into your EIP are more attractive for tax purposes than a salary increase. Your salary increase will be subject to personal income tax, whereas the payments into your EIP pension contract generate a higher return.
3. You can use your independent EIP insurance to finance a property investment. In addition, you can optimise your EIP each year according to your salary.
   
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