Creation of an employer levy on defined-benefit pension schemes ("top-hat" pensions)

Article 115 of the Pension Reform Act of 21 August 2003 creates Article L. 137-11 of the Social Security Code. Defined-benefit pension schemes that make rights conditional on ending one's career in the company are subject to an employer levy for the old-age solidarity fund, based, at the employer's irrevocable choice, either on annuities paid from 1 January 2004, for the portion above one third of the social security ceiling, at 8%; or on premiums paid to an insurer or on provisions, at 6% for financial years beginning after 31 December 2003, rising to 12% from 2009 for provisions. In return, these employer contributions are excluded from the base for social security contributions, CSG and CRDS.