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Income tax - How are the income from a life insurance contract taxed?
Verified 01 January 2026 - Public Service / Directorate of Legal and Administrative Information (Prime Minister)
Income tax: 2026 income tax return for 2025
This page is up to date at 1er January 2026.
However, forms, online services and information materials are not yet available for the 2026 tax year of the 2025 tax return. They will be put online as soon as they are available.
In addition, the draft budget law for 2026 could not be promulgated before 1er January 2026.
The law n°2025-1316 of 26 december 2025 The Special Authorizes the Government to Collect Taxes, Without Modifying the Scales, Until the Adoption of a Budget Law for 2026.
If the Finance Law for 2026 changes the rules presented on this page, the content will be updated after the publication of the Finance Law in the Official Journal.
If you have a life insurance policy, you are taxed only if you make a buyback (whether total or partial). The gains you have made are taxed according to the duration of your contract. However, exemptions are provided for in certain cases. We tell you what you need to know.
What applies to you ?
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The gains made by your life insurance are taxed according to rules specific to this investment.
FYI
Earnings from a life insurance contract are always subject to social levies (CSG, CRDS) at the rate of 17.2%.
Taxation depends on the date of subscription of your contract: before or since September 26, 1997.
Contract signed since 26 September 1997
If you have a life insurance policy, you are taxed only if you make a redemption (whether total or partial).
Taxation varies according to the following:
- Date of payment of the premium
- Duration of contract holding.
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Premiums paid since September 27, 2017
Taxation depends on the age of your contract.
Contract under 8 years
The interest on your life insurance policies is taxed in 2 steps.
1. Upon payment, they shall be subject to a flat-rate non-liberating levy from 12.8% (unless you apply for exemption based on your reference tax income).
2. Interest is recorded on your tax return to be taxed by one of the following means:
- Flat rate of 12.8%
- Progressive scale of income tax if you choose this global option when filing your tax return.
Any surplus is returned to you.
You can apply to be exempted from flat-rate non-liberating levy if your reference tax income of the penultimate year is less than:
- €25,000 if you are single
- €50,000 for a married or former couple subject to joint taxation.
For income received in 2026, this is the reference tax income for 2024.
The application must be sent to the financial institution that pays you the income no later than November 30 of the year preceding the year of payment (November 30, 2026 for an exemption in 2027).
In general, the institution sends you a completed sworn form to return if you meet the conditions.
Contract over 8 years
The interest on your life insurance policies is taxed in 3 stages.
1. Earnings shall be subject to payment to a flat-rate non-liberating levy from 7.5% (unless you apply for exemption based on your reference tax income).
2. You must report these gains on your tax return after deducting the abatement next:
- €4,600 for a bachelor
- €9,200 for a couple.
Warning
The allowance is granted for all life insurance contracts held by the same taxpayer.
3. Interest shall be charged at the following flat rates:
- 7.5% for interest corresponding to premiums not exceeding €150,000
- 12.8% for interest corresponding to premiums exceeding €150,000.
However, you can be taxed at progressive scale of income tax if you choose this option when filing your tax return
Any surplus is returned to you.
You can apply to be exempted from flat-rate non-liberating levy if your reference tax income of the penultimate year is less than:
- €25,000 if you are single
- €50,000 for a married or former couple subject to joint taxation.
For income received in 2026, this is the reference tax income for 2024.
The application must be sent to the financial institution that pays you the income no later than November 30 of the year preceding the year of payment (November 30, 2026 for an exemption in 2027).
In general, the institution sends you a completed sworn form to return if you meet the conditions.
Premiums paid before September 27, 2017
Taxation depends on the age of the contract.
Contract under 8 years
The interests of your life insurance policies under 8 years old can be taxed in one of 2 ways:
- Or, at the time of their payment, flat-rate discharge from 15%, if you choose this global option at the time of payment
- At the time of processing your tax return, progressive scale of income tax, if you have not opted for the flat rate when paying interest.
Contract over 8 years
The interests of your life insurance policies over 8 years of age can be taxed in one of 2 ways:
- Or, at the time of their payment, flat-rate discharge from 7.5%, if you choose this option at the time of payment
- At the time of processing your tax return, progressive scale of income tax, if you have not opted for the flat rate when paying interest.
You benefit from a abatement on these gains, the amount of which is as follows:
- €4,600 for a bachelor
- €9,200 for a couple.
Warning
The allowance is granted for all life insurance contracts held by the same taxpayer.
The interest recovered may be exempt from tax in certain cases.
It depends on the reason you are asking for the redemption or termination of the contract:
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Dismissal
The interests of life insurance are exempt income tax if the termination of the contract results from a dismissal.
Dismissal is accepted if you are one of the following:
- The one who signed the contract
- Spouse or partner of Civil partnerships: titleContent of the subscriber.
Warning
The exemption does not apply in the event of a contractual breach or termination of a fixed-term contract.
The exemption applies if the redemption or termination of the contract occurs before the end of the year following that of the dismissal.
Example :
You are dismissed on May 5, 2026.
The repurchase or termination of the contract must take place no later than 31 December 2027.
Early retirement
The interests of life insurance are exempt income tax if the termination of the contract results from early retirement.
Early retirement is withheld if you are one of the following:
- The one who signed the contract
- Spouse or partner of Civil partnerships: titleContent of the subscriber.
The exemption applies if the redemption or termination of the contract occurs before the end of the year following that of early retirement.
Example :
You are retired early on May 5, 2026.
The repurchase or termination of the contract must take place no later than 31 December 2027.
Disability
The interests of life insurance are exempt income tax if the termination of the contract results from the recognition of invalidity (2e or 3e category).
Disability is considered if you are one of the following:
- The one who signed the contract
- Spouse or partner of Civil partnerships: titleContent of the subscriber.
The exemption applies if the redemption or termination of the contract occurs before the end of the year following that of the recognition of invalidity.
Example :
You are recognized as disabled on May 5, 2026.
The repurchase or termination of the contract must take place no later than 31 December 2027.
Judicial liquidation
The interests of life insurance are exempt income tax if the termination of the contract results from the liquidation of the court.
Liquidation is retained if you are one of the following:
- The one who signed the contract
- Spouse or partner of Civil partnerships: titleContent of the subscriber.
The exemption applies if the redemption or termination of the contract occurs before the end of the year following that of the liquidation.
Example :
The bankruptcy is decided on May 5, 2026.
The repurchase or termination of the contract must take place no later than 31 December 2027.
To make your tax return, you can consult the following documents:
- Explanatory leaflet (in particular income from securities and securities)
- Income Tax Practical Brochure
- Supporting documents submitted by paying institutions (IFU form).
If a pre-filled amount is inaccurate, you must correct or complete it.
Contract signed before 26 September 1997
If you have a life insurance policy, you are taxed only if you make a redemption (whether total or partial).
Taxation varies according to the following:
- Contract Subscription Date
- Date of payment of the premium.
Taxation depends on the date of subscription of the contract.
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Contract signed from 1 January 1983 to 25 September 1997
Taxation depends on the date of payment of the premiums.
Interest on premiums paid since 1 January 1998
Interest earned in 2026 is imposed at the rate of 7.5% if they result from premiums paid since 1er January 1998.
Interest is taxed after deducting the abatement next:
- €4,600 for a bachelor
- €9,200 for a couple.
The allowance is granted for all life insurance contracts held by the same taxpayer.
FYI
The interests of life insurance are exempt income tax if the redemption results (for you or your married or former spouse) from any of the following reasons:
- Dismissal
- Retirement
- Disability
- Liquidation.
Interest on premiums paid before 1 January 1998
Interest earned in 2026 is exempt income tax, under certain conditions, only if they result from premiums paid before 1er January 1998.
Contract signed before 1 January 1983
Taxation depends on the date of payment of the premiums.
Interest on premiums paid since October 10, 2019
Interest earned in 2026 is imposed at the rate of 7.5% if they result from premiums paid since October 10, 2019.
Interest is taxed after deducting the abatement next:
- €4,600 for a bachelor
- €9,200 for a couple.
The allowance is granted for all life insurance contracts held by the same taxpayer.
FYI
The interests of life insurance are exempt income tax if the redemption results (for you or your married or former spouse) from any of the following reasons:
- Dismissal
- Retirement
- Disability
- Liquidation.
Interest on premiums paid before October 10, 2019
Interest earned in 2025 on contracts signed before 1er January 1983 are exempt income tax only if they result from premiums paid before October 10, 2019.
To make your tax return, you can consult the following documents:
- Explanatory leaflet (in particular income from securities and securities)
- Income Tax Practical Brochure
- Supporting documents submitted by paying institutions (IFU form).
If a pre-filled amount is inaccurate, you must correct or complete it.
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