What is the Value Sharing Premium (VPP) formerly known as the "Macron Premium"?
Verified 02 September 2022 - Directorate for Legal and Administrative Information (Prime Minister)
The Value Sharing Premium (VPP), formerly known as Macron bonus or purchasing power premium, is a scheme which allows the employer to pay the employee a premium. This is a sustainable mechanism that companies can put in place every year. The premium remains optional. Payment of this amount depends on a decision made by the employer or on a company agreement. The conditions for obtaining and exempting this premium from tax vary according to the date on which it is paid.
Between July 1, 2022 and December 31, 2023
Employers who may decide to pay a value-sharing premium to their employees or agents are:
- Private-law employers, including self-employed persons (craftsmen, traders, farmers, liberal professions)
- Industrial and Commercial Public Establishments (EPIC) and Administrative Public Establishments (EPA)
- Establishments and labor support services (State)
The premium may be paid to:
- Employees linked to the company by a contract of employment (in CDI, CDD, full-time or part-time)
- Public officials of a public administrative or industrial and commercial establishment (EPIC and EPA)
- Acting
- Disabled workers linked to a State
Payment of the premium is foreseen:
- Either by a company agreement or a incentive agreement
- Or of a decision taken by the employer
In the event of a decision by the employer, the Social and Economic Committee (ESC), where it exists, shall be consulted beforehand.
The premium shall be paid in accordance with the following conditions:
- The premium cannot replace a pay increase provided for by a pay agreement in the company.
- If the premium is paid only to some of the company's employees, those whose remuneration is above a cap set by the employer or a company agreement will be excluded.
- The premium must be paid between 1er July 2022 and December 31, 2023. It may be the subject of an advance, but the balance must be paid no later than that date.
- The premium may be paid in one or more installments, with a maximum of one installment per quarter.
The employer is free to pay or not pay a premium to employees.
The amount of the premium shall be fixed by the employer.
The amount of the sharing premium may be the same for all employees.
The amount may also be adjusted according to the beneficiaries according to the remuneration, the level of classification, the length of service in the company, the period of actual presence during the previous year or the period of work laid down in the employment contract.
The conditions of exemption depend on the amount of the remuneration of the employee during the 12 months preceding payment of the premium :
Remuneration less than 3 times the annual minimum wage
The premium shall be exempt from income tax, payroll and social contributions including the CSG: titleContent and the CRDS: titleContent, up to €3,000 per year and per beneficiary.
The premium shall be exempt under the same conditions, up to €6,000 if the employer establishes, on the date of payment of the premium, or has concluded the year of payment of the premium:
- one incentive agreement, where it is subject to the obligation to introduce participation
- one incentive agreement or a participation agreement, while it is not subject to the obligation to introduce participation
Example :
if the premium is paid on 1er august 2022, the remuneration taken into account is that received during the period of 1er August 2021 to July 31, 2022.
Remuneration of at least 3 times the annual minimum wage
The premium shall be exempt from payroll and social contributions up to €3,000 per year and per beneficiary.
The premium shall be exempt under the same conditions, up to €6,000 if the employer establishes, on the date of payment of the premium, or has concluded the year of payment of the premium:
- one incentive agreement, where it is subject to the obligation to introduce participation
- one incentive agreement or a participation agreement, while it is not subject to the obligation to introduce participation
Example :
if the premium is paid on 1er august 2022, the remuneration taken into account is that received during the period of 1er August 2021 to July 31, 2022.
Please note
the premium shall not be exempt from income tax, the CSG: titleContent and the CRDS: titleContent.
Warning
where the value-sharing premium is combined with the exceptional purchasing power premium (PEPA) which may have been paid until 31 March 2022, the total amount exempt from income tax in respect of income for the year 2022 may not exceed €6,000.
From 2024
Employers who may decide to pay a value-sharing premium to their employees or agents are:
- Private-law employers, including self-employed persons (craftsmen, traders, farmers, liberal professions)
- Industrial and Commercial Public Establishments (EPIC) and Administrative Public Establishments (EPA)
- Establishments and labor support services (State)
The premium may be paid to:
- Employees linked to the company by a contract of employment (in CDI, CDD, full-time or part-time)
- Public officials of a public administrative or industrial and commercial establishment (EPIC and EPA)
- Acting
- Disabled workers linked to a State
Payment of the premium is foreseen:
- Either by a company agreement or a incentive agreement
- Or of a decision taken by the employer
In the event of a decision by the employer, the Social and Economic Committee (ESC), where it exists, shall be consulted beforehand.
The premium shall be paid in accordance with the following conditions:
- The premium cannot replace a pay increase provided for by a pay agreement in the company.
- If the premium is paid only to some of the company's employees, those whose remuneration is above a cap set by the employer or a company agreement will be excluded.
- The premium may be paid in one or more installments, with a maximum of one installment per quarter.
The employer is free to pay or not pay a premium to employees.
The amount of the premium shall be fixed by the employer.
The amount of the sharing premium may be the same for all employees.
The amount may also be adjusted according to the beneficiaries according to the remuneration, the level of classification, the length of service in the company, the period of actual presence during the previous year or the period of work laid down in the employment contract.
The premium shall be exempt from payroll and social contributions up to €3,000.
The premium shall be exempt under the same conditions, up to €6,000 if the employer establishes, on the date of payment of the premium, or has concluded the year of payment of the premium:
- one incentive agreement, where it is subject to the obligation to introduce participation
- one incentive agreement or a participation agreement, while it is not subject to the obligation to introduce participation
Please note
the premium shall not be exempt from income tax, CSG: titleContent and the CRDS: titleContent.
Ministry of Economy