Pension

PLCI

Pension Libre Complémentaire pour Indépendants (free supplementary pension for the self-employed, VAPZ in Dutch)

By the Finances Indépendants editorial teamUpdated on 5 min readAlso known as: Free supplementary pension, VAPZ, Social PLCI

Contents
  1. What is the PLCI/VAPZ?
  2. Ordinary or social PLCI/VAPZ: which to choose
  3. How the deduction works in practice
  4. Why the PLCI/VAPZ comes before the IPC and the POZ/CPTI
  5. What happens on exit
  6. Not to be confused with
  7. Further reading
  8. Frequently asked questions
€4,086.34
Annual ceiling, ordinary PLCI/VAPZNISSE2026
8.17%
of net professional incomeNISSE2026
€4,701.54
Annual ceiling, social PLCI/VAPZNISSE2026
10 years
Period over which the notional annuity is taxed on exitFPS Finance2026

What is the PLCI/VAPZ?

The PLCI/VAPZ, the free supplementary pension for the self-employed (Pension Libre Complémentaire pour Indépendants), is a pension insurance contract that a self-employed person takes out individually and funds personally. It belongs to the second pillar of pensions and tops up the statutory pension paid by the NISSE, which remains low for a self-employed person.

The mechanism fits in one sentence: what you pay into the contract comes off your taxable base like any ordinary business expense. You therefore save twice, on personal income tax and on social security contributions, since the latter are calculated on a net income already reduced by the premium.

It is open to any self-employed person who is up to date with social security contributions, whether working in their own name or through a company. That is what sets it apart from the IPC (individual pension commitment, EIP/IPT), reserved for company directors, and from the POZ/CPTI (pension agreement for the self-employed), reserved for people working in their own name.

Ordinary or social PLCI/VAPZ: which to choose

The two versions differ on one point: the social PLCI/VAPZ takes part of the premium to fund solidarity benefits, and offers a higher ceiling in return. The ordinary ceiling is €4,086.34, the social ceiling €4,701.54, or 9.4% of income instead of 8.17%.

With the social PLCI/VAPZ, at least 10% of the premium funds a solidarity component (incapacity for work, death, disability). This solidarity share, around 10% of the premium, does not build up pension capital: it pays for cover. The useful comparison is therefore not "ceiling against ceiling" but "capital built up against capital built up, for equivalent cover".

The choice depends on what you already have elsewhere. A self-employed person already well covered by solid income protection insurance will get more out of the ordinary version; a self-employed person with no incapacity cover will find in the social version a protection funded by a deductible premium.

How the deduction works in practice

The PLCI/VAPZ premium is deducted as a business expense, not as a tax reduction. The difference is decisive: a deduction comes off taxable income and therefore saves tax at your marginal rate, whereas a reduction applies at a fixed rate. For a self-employed person whose top slice of income is taxed at 45% or 50%, the gap is considerable.

On top of this tax saving comes a social security saving. Since NISSE contributions are calculated on net taxable income, a deducted premium lowers the calculation base and therefore the contribution, at a rate of 20.5% in the first band.

The combination of these two effects explains the tax return often quoted at between 50% and 70% of the premium paid. The exact figure depends on your tax band and your municipality, and needs to be calculated for your own situation.

Why the PLCI/VAPZ comes before the IPC and the POZ/CPTI

The PLCI/VAPZ is the only second-pillar scheme excluded from the 80% rule. It is calculated outside the 80% rule and can be freely combined with an IPC and the statutory pension.

The practical consequence is an order of priority. What you pay into a PLCI/VAPZ does not use up the 80% ceiling, so it does not reduce what an IPC or a POZ/CPTI can still absorb afterwards. The reverse is not true. Filling the PLCI/VAPZ first therefore maximises the total you can deduct in the year.

  • Self-employed in your own name: PLCI/VAPZ up to the ceiling, then POZ/CPTI within the 80% limit, then pension savings.
  • Company director: PLCI/VAPZ up to the ceiling, then IPC within the 80% limit, then pension savings.

What happens on exit

Contrary to a widespread belief, PLCI/VAPZ capital is not taxed at a flat rate of 10%. That rate belongs to the IPC. The PLCI/VAPZ falls under the notional annuity mechanism: the tax authorities convert the capital into a theoretical annual annuity of 4% to 5% of the net capital, taxed at your marginal personal income tax rate for 10 years.

Two factors change the bill. Capital received before age 65 spreads the notional annuity over 13 years instead of 10. And if the self-employed person actually stays active until the statutory pension age, the notional annuity applies to only 80% of the capital. On top of that come a NIHDI (INAMI/RIZIV) levy of 3.55% and a solidarity levy of 0% to 2%.

The minimum age to receive the capital is 60. Early withdrawal loses the preferential regime, which makes the PLCI/VAPZ poorly suited to a medium-term need for cash.

Not to be confused with

The terms close to PLCI and what sets them apart.

PLCI and IPC
The IPC is funded by the company for its director and deductible from corporate income tax. The PLCI/VAPZ is funded by the self-employed person and deductible from their professional income. The two can be combined.
PLCI and POZ/CPTI
The POZ/CPTI is the equivalent of the IPC for a self-employed person working in their own name, and is subject to the 80% rule. The PLCI/VAPZ is excluded from it and is filled first.
PLCI and Pension savings
Pension savings are a private product open to all taxpayers and give a tax reduction, not a deduction as a business expense. They come after the PLCI/VAPZ in the order of priority.

Further reading

PLCI: frequently asked questions

  • The 2026 ceiling is €4,086.34 for the ordinary version, or 8.17% of net professional income in the reference year, and €4,701.54 for the social version, or 9.4%. These amounts are absolute ceilings: if your income is low, the applicable ceiling is the percentage, not the maximum amount.

  • The percentage normally applies to net professional income from three years earlier, which a starter does not yet have. In the first few years, it applies to the income used as the basis for calculating their social security contributions. The absolute ceiling of €4,086.34 remains the limit, and a premium cannot be lower than €100 a year.

  • No, and that is its main strength. It is calculated separately and can be freely combined with an IPC, a POZ/CPTI and the statutory pension. That is why it is always filled first: it does not use up the ceiling that the other schemes have to respect.

  • Yes. A company director can take out a PLCI/VAPZ personally and also benefit from an IPC funded by their company. The PLCI/VAPZ stays outside the 80% rule; the IPC is subject to it. It is the most effective combination for a director of an SRL/BV (private limited company).

  • The PLCI/VAPZ premium is only deductible if the year's social security contributions have actually been paid in full during that same year. A quarter settled the following January is enough to lose the deduction for the year. Bring your account up to date with your social insurance fund before 31 December, then pay the premium.

  • Through the notional annuity mechanism, not a flat rate of 10%: the capital is converted into a theoretical annual annuity of 4% to 5%, taxed at your marginal rate for 10 years (13 years if the capital is received before 65). On top of that come the NIHDI levy of 3.55% and the solidarity levy. The real cost remains well below receiving the money as remuneration, but it is not 10%.

  • Yes, the premium must be paid before 31 December to be deductible for the current tax year. A payment made in January counts towards the following year. In practice, social insurance funds and insurers ask for a payment order a few days before the end of the year.

Official source

  1. NISSE, PLCI. View (new tab)(Official source, accessed on 2026-10-11)