PEA Tax: Before and After 5 Years

PEA taxation is based on a simple mechanism: the longer you keep your plan, the lighter the tax burden. The key threshold is the 5-year holding period. Before this deadline, any withdrawal triggers the closure of the PEA and the application of the 30% flat tax (PFU) on gains. After 5 years, gains are subject only to social contributions of 17.2%, representing a saving of 12.8 percentage points.

Since the PACTE law of 2019, a partial withdrawal after 5 years no longer closes the PEA. You can therefore withdraw part of your gains while keeping the plan open and continue to make new contributions (within the 150,000 euro ceiling). This reform considerably improved the flexibility of the PEA.

The 17.2% social contributions break down as follows: CSG (9.2%), CRDS (0.5%), solidarity levy (7.5%). They are calculated on all gains realized (cumulative capital gains and dividends) at the time of withdrawal.

To illustrate the impact of holding period, let's take the example of a PEA that has generated 50,000 euros in gains. Before 5 years, the 30% flat tax takes 15,000 euros, leaving only 35,000 euros net. After 5 years, only the 17.2% social contributions apply, i.e. 8,600 euros: you keep 41,400 euros net. The difference is 6,400 euros.

For larger gains, the gap widens further. For 200,000 euros in gains, the saving after 5 years reaches 25,600 euros. This is why it is crucial to open your PEA as early as possible, even with a token deposit, in order to start the 5-year tax clock.

Note: the 5-year period runs from the date of the first deposit into the PEA, not from the administrative account opening date. Make sure to make a first deposit at the time of opening, even a minimal one.