Certain retirement pensions will be reduced in 2027 beyond 7,000 euros of income generated by combined employment and retirement

It's no secret that some retirement pensions are today too low to allow their beneficiaries to live adequately. The solution for those who can is often to continue working in parallel. We then talk about combining employment and retirement. A combination also chosen by some who simply like to keep an activity, even if they are not financially in need. But combine by choice or by necessity, all are affected by a recently published decree.

To explain it, it is best to take an example: a retiree receives an annual pension of 20,000 euros and continues a salaried activity which earns him 12,000 euros. Well from 2027, between the legal retirement age and 67 years, his pension will be reduced to 17,500 euros. In fact, his income exceeds the threshold of 7,000 euros, and the reduction corresponds to 50% of the excess, in this case 5,000 euros.

This rule will not exactly affect all working retirees. It will concern those whose first civil retirement pension, whatever their basic plan, takes effect from January 1, 2027. People whose first pension took effect before January 1, 2027 will not switch to this new system. Disability pensions and survivor's pensions, paid after the death of a spouse, also remain outside these rules.

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The age of the retiree becomes decisive. Before the legal retirement age, which depends on the year of birth, professional income or income paid in replacement of a salary will be entirely withdrawn from pensions from the first euro, within the limit of the annual amount of pensions. Contributions paid during this period will no longer give new retirement rights. Between the legal age and 67 years old, the threshold of seven thousand euros will apply. From the age of 67, the accumulation will become full again, with no income limit.

To calculate the reduction, the funds will add over the calendar year professional income and certain replacement income received during the same periods as pensions. For a micro-entrepreneur falling under the micro-social regime, the turnover or receipts will be retained. Certain amounts paid during sick leave will also be included in the calculation. The reduction cannot, however, exceed the total amount of personal pensions corresponding to the period during which the income was received.

In principle, the amount to be withdrawn will be distributed equally over the twelve calendar months following the calculation, starting from the first day of the month following it. The levy will not be able to reduce the total monthly or quarterly pensions by more than a third. If the entire reduction cannot be recovered after twelve months, the rest will be taken afterwards, with the same limit.

Machine-translated from French