The articles L 242-1 of the CSS and 80 duodecies of the CGI, reserve the exemption, partly of their amount, of social contributions and income tax of the indemnities paid on the occasion of the conventional break of the contract of work In the event that the employee is not entitled to a retirement pension from a legally compulsory scheme, they are based on an objective and rational criterion to prevent employees from having an incentive to terminate their professional career prematurely.
The Court of Cassation considers that there is no infringement of the constitutional principle of equality in public office.
Finally, the principle of equality is not applicable because employees who have not yet reached the legal retirement age (exempt) and those who have reached it even though they would not yet benefit from the full (not exempt) are not in an identical situation.
This creates a difficulty for "senior" employees who can benefit from a full-rate basic pension or not, who wish to leave in the context of a conventional break since the conventional (individual) termination benefit is subject to taxes. on income and social contributions.
To avoid taxation and the "socialization" of severance benefits, employers and employees often agree to terminate the employment contract by dismissal followed by a transaction.
Finally, last but not least, for employees who can benefit from a full-rate basic retirement pension or not, it is possible, since 1 January 2018, to benefit from a tax exemption on income and social contributions in the context of a Collective Contractual Breakdown. Cf Our article Collective breakage collective: the tax jackpot for employees ! (Thanks President Macron).https: //www.village-justice.com/articles/conventional-ruption-collective-jackpot-fiscal-for-salaries-thanky.26896.html
To read all the Article, please click on the link below
. Cass. 2nd civ. June 13, 2019, No. 19-40011 F-D).
. Article 80 duodecies of the General Tax Code
. Article L. 242-1 of the Social Security Code
. Circular DSS / DGPD / SD5B No. 2009-210, July 10, 2009
Frédéric CHHUM, Avocat à la Cour et Membre du Conseil de l’ordre des avocats de Paris
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