Becoming an employee or starting a business in France, means you pay social security contributions, some of which go towards a pension on your retirement.
If you decide to take your pension but you wish to continue with a professional activity, it is possible to do so, subject to certain conditions.
If you are only in receipt of a foreign pension, there is no restriction on your right to undertake a professional activity.
Although there are different State pension schemes in France, over 80% of the population is in the main insurance scheme, called the régime général.
Different rules apply to certain professional groups, such as civil servants, certain ‘liberal’ professions (lawyerS, architects etc), and agricultural workers whose schemes are not considered in this note.
Those activities that you may continue with on an unrestricted basis include an activity that generates only a small amount of income, literary or scientific activities, letting of rural accommodation, social care, occasional consulting work and artistic activities.
Other than these few exemptions, there are two possible pathways to continuing with a professional activity whilst in receipt of your French pension. Combining a professional activity with your pension is called ‘cumul emploi-retraite.’
These pathways are either:
Cumul Emploi-Retraite Total/Libéralisé, or;
Cumul Emploi-Retraite Partiel/Plafonné.
i. Cumul Emploi-Retraite Total/Libéralisé
In order to keep your full pension plus all income from other professional activities you must have:
Met all conditions that allow you to claim a basic French state pension at the full rate;
Declared your retirement from all professional activities;
Claimed all your pensions from the French basic and supplementary pension schemes, from any foreign pension schemes, and from any pension schemes linked to international organisations.
If all these conditions are met, there is no limit to the amount you can continue to earn while claiming your pension. Meeting the 'full-rate' condition does not mean you are entitled to a full pension.
ii. Cumul Emploi-Retraite Partiel/Plafonné
If you do not meet all of the above conditions you may still be able to receive part of your pension while gaining income from professional activity.
The main difference is that the sum of your income and your pensions must not exceed a certain limit. This limit will vary depending on the scheme in question.
a. Basic Pension
For the basic pension scheme the sum of your pensions and your new income will be limited to whichever of the following amounts is greater:
Either:
160% of the monthly minimum wage (SMIC), which since January 2022 is €2,564 gross;
The average gross monthly salary earned during your final 3 months of work before retiring.
If the monthly sum of your income plus your pensions exceeds whichever of these two amounts is greater, your basic pension will be reduced by an equivalent amount.
b. Complementary Pension Schemes (Retraite Complémentaire)
Although a complementary pension is mandatory in France, the pension scheme itself depends on your activity.
Each pension scheme has specific rules but most common scheme is called 'AGIRC- ARRCO' where the rules for the are very similar to those for basic pensions. However, the income limit is set at the highest amount of the following:
Either 160% of the monthly minimum wage (SMIC);
The amount of your final salary;
The average salary of the last ten years of work.
For such pensions, if the sum of your income and your pensions exceeds the limit, your pension will be suspended completely rather than just reduced.
Self Employed
The pension scheme for self-employed business owners is now part of the general scheme, but the particular rules for the limit on the cumul emploi-retraite partiel for independent workers currently are as follows:
For those who live in rural or urban development areas (ZRR or ZUP) annual earnings should not exceed €41,136 (2022);
For those who live elsewhere, annual earnings should not exceed €20,568.
If this limit is exceeded, the payment of the pension will be suspended. This applies to both the basic and complementary pension.
Reform Promised
President Macron is promising to simplify and improve the ability to combine employment and retirement, if he is reelected. He has stated: "on the one hand by simplifying the mechanisms for gradual retirement and, on the other hand, by allowing a much greater incentive to benefit from one's retirement while continuing to earn contribution rights, which is one of the weaknesses of the current system of combining employment and retirement".
Related Reading:
