Saving & investing
Niet-fiscaal vrij sparen
Non tax saving is saving and investing freely through a life insurance policy, without any tax relief on the premium but also without any tax straitjacket. You decide yourself how much you pay in and when, and combine the certainty of Branch 21 with the growth potential of Branch 23.
- Who we help
- For those who have already used their tax-advantaged savings pots to the full, such as the VAPZ (the free supplementary pension for the self-employed), the IPT (individual pension commitment), pension saving or long-term saving, and still want to make capital grow with complete flexibility.
- The tax benefit
- No relief on the premium, but favourable taxation at the end: on your Branch 23 investment you pay no withholding tax.
What is non tax saving?
With non tax saving you make an investment with an insurer instead of with a bank. Instead of a securities account, you take out a contract with an insurance company, in which your money is invested, for example, spread across several funds, for the rest of your life or until you withdraw the money again. Economically this closely resembles an investment with a bank, but legally, fiscally and in terms of estate planning an insurance contract offers numerous advantages. The same solution is also called a non tax contract, free savings or a 4th pillar insurance. These are terms that refer to the same type of insurance.
- The 4th pillar indicates that this is the last supplementary pension pillar, namely the pillar you have to provide for yourself
- The term 'free savings' refers to the fact that, as an investor, you take on no obligation to make regular payments, as is often the case with a tax policy
- The term non tax contract indicates that the premium you pay is not deducted for tax anywhere, and that you are therefore not taxed on the result of this investment either
Why save freely alongside your tax policies?
Preserving purchasing power over the long term
The average retirement age is 63, the average life expectancy 83. That means your savings have to keep their value against inflation for an average of 20 years. Your standard of living, inflation and the chosen investment profile with its associated return all help determine whether the invested amount will last you over the long term.
No tax straitjacket
Tax-advantaged savings schemes impose a maximum premium and often a fixed term. With non tax saving you decide yourself how much you pay in and when, with no ceiling on the premium and no obligation to pay in every year.
Super diversification of your investment
Based on your investment profile, Life Experts spreads your invested money across the maximum number of funds allowed by the insurer, and possibly even across several insurers.
Peace of mind with a reliable partner
Your money is placed with a reliable financial partner. You regularly receive an update, or request one yourself, and the costs are clearly agreed in advance.
Who is non tax saving intended for?
Non tax saving is intended for those who have already filled up their tax-advantaged savings options and still want to invest further. Anyone paying in the maximum to a VAPZ, an IPT, pension saving or long-term saving runs into the statutory premium limits of those tax-advantaged schemes. Whatever you want to set aside on top of that can generate returns through a non tax contract, with no ceiling on the premium. Those who receive a lump sum at once, for example after a sale, an inheritance or the payout of a pension capital, and want to make that money grow rather than leave it in a savings account, will also find a flexible solution here.
Branch 21 or Branch 23?
You can take out a non tax contract in Branch 21, in Branch 23, or in a combination of the two. The choice depends on your investment profile: are you prepared to take risk for a potentially higher return, or do you prefer more certainty so that you at least get your stake back? Life Experts determines your profile together with you through an online profile test and gives tailored advice.
Branch 21: aiming for certainty
Branch 21 offers a guaranteed capital, usually supplemented with a possible profit share. This choice suits those who mainly seek certainty and want to protect their stake.
Branch 23: aiming for return
Branch 23 invests in investment funds and aims for a potentially higher return. The capital and the return are not guaranteed: your result follows the value of the underlying funds and therefore the fluctuations of the stock market. A good and sound choice of funds is therefore extremely important.
Our tips: let your investment work for you automatically
No one can time the stock market exactly. That is why it is said that 'time in the market' is more important than 'timing the market'. Fortunately, your investment insurance policy can be 'programmed' in advance, so that you can invest with relative peace of mind in funds that also hold equities. These are our three favourite settings:
Dripfeed
At the start or with a large payment, we provide an automatic dripfeed. Over 12 to 24 months your money is invested drop by drop into the fund combination you have chosen. This fully automatically simulates a regular monthly investment for a one off contribution, and spreads out your entry point.
Rebalancing
During the term, a rebalancing ensures that your investment always matches your original choice. When the value of a fund deviates strongly from your chosen allocation, a transfer is carried out to return to the original allocation.
Dynamic stop loss
A dynamic stop loss limits your losses. If the value of a particular fund falls by 20%, for example, the balance of that fund is transferred to a low risk monetary fund.
What is the tax treatment?
You do not deduct the premium of a non tax contract for tax anywhere, and in return you are not taxed on the result of your investment. On each payment you do pay a premium tax of 2% for individuals. Occasional commercial promotions by insurers sometimes mean that this 2% tax is borne by the insurer. Ask your Life Experts adviser about this. At the end date the tax treatment differs according to the branch:
- For the Branch 23 component you pay no withholding tax, and therefore no levy on the gain you withdraw
- For a Branch 21 component with a guaranteed return, withholding tax is due if you withdraw your money before 8 years and 1 day. If you withdraw later, that levy falls away. On the death of the insured person, no withholding tax is due
Flexible withdrawals and costs
A major advantage of saving freely is the flexibility. Depending on how the policy was structured at the outset, you can always withdraw your money in whole or in part. In insurance jargon that is called 'surrendering'.
- On demand: for example when you wish to withdraw 2,500 euro
- Automatic: for example 3,000 euro every quarter, as a supplement to your income
Does this fit your situation?
You will get an honest answer, even if that answer is "no".
Disclaimer: Life Experts provides insurance solutions for self-employed directors, liberal professions, SMEs and large companies. You will find the basic information for each type of solution on this website. With the product descriptions and the product overview on this website, we do not aim to follow a tax or legal classification, but a pragmatic and practical one. A turnover insurance, for instance, is fiscally a company-director insurance. And a death cover or a disability insurance can be taken out within the tax regimes of IPT, VAPZ, POZ, long-term saving, pension saving, and so on.