PEA vs Standard Brokerage (CTO) Tax Optimizer

Model the 5-year French PEA tax exemption (18.6% vs 31.4% flat tax) and frictionless dividend compounding.

PEA or ordinary securities account: comparing French taxation

After 5 years, gains in a French PEA (plan d'épargne en actions) bear only the 18.6% social levies, whereas an ordinary securities account (CTO) pays the 31.4% flat tax on every dividend and every realised gain. Over 15 years, with €10,000 then €500 a month at 8%, the tool puts the gap at about €18,100 in favour of the PEA.

How the tool models it

  • PEA: each year, capital plus that year's contributions grow at the total return, tax-free. At the end, 18.6% social levies apply to the gain (capital − contributions), with no income tax since the minimum horizon is 5 years.
  • CTO: the dividend share is taxed at 31.4% every year and reinvested; the capital-gain share is realised according to the chosen turnover rate and that realised gain is taxed at 31.4%. At the end, 31.4% applies to the unrealised gain, meaning capital minus cost basis (contributions, net dividends and already-taxed gains that were reinvested).

Example

€10,000 upfront, €500 a month, 15 years, 8% return including 2.5% dividends, 15% turnover. Contributions: €100,000. PEA: €207,667 gross, €187,641 net. CTO: €188,136 gross after €13,229 of tax paid along the way, €169,536 net. Gap: €18,105. With no dividends and no turnover it falls to €13,781, which is 12.8% of the gain: only the income tax difference remains.

Limits

  • The €150,000 PEA contribution cap is not checked, and only European shares qualify.
  • A withdrawal before 5 years loses the exemption: 12.8% income tax is then added to the social levies.

This simulates French tax rules and is not investment advice.

Sources and dates: social levies raised from 17.2% to 18.6% on 1 January 2026 by article 12 of the 2026 social security financing act (higher CSG), giving a 31.4% flat tax; PEA income tax exemption after 5 years, €150,000 cap and social levies at the rate in force on the withdrawal date, per the impots.gouv.fr page on life insurance and the PEA updated on 8 April 2026 (checked on 14/10/2026).

Frequently Asked Questions

How are gains in a PEA held over 5 years taxed in 2026?

They are exempt from income tax and bear only social levies, which rose from 17.2% to 18.6% on 1 January 2026. The rate in force on the withdrawal date applies, including to gains built up before 2026.

What is the flat tax rate on a French securities account in 2026?

The flat tax (PFU) has been 31.4% since 1 January 2026: 12.8% income tax plus 18.6% social levies. It applies to dividends and capital gains on disposals, unless you opt for the progressive scale on all your investment income.

What happens if I withdraw from a PEA before 5 years?

The net gain is taxed at 12.8% on top of the 18.6% social levies, so 31.4% as on a securities account, and the withdrawal normally closes the plan, apart from exceptions set by law. The tool does not model this case: its minimum horizon is 5 years.

How much can I pay into a PEA?

Contributions to a standard PEA are capped at €150,000. The cap applies to amounts paid in, not to the plan's value, so gains can take it well beyond that figure. The tool does not check the cap, so make sure your cumulative contributions stay below it.

Is this tool really free?

Yes, all tools on Kristools are 100% free and accessible without registration.

Is my data protected?

Yes. All processing is performed directly and securely inside your browser. No personal data is sent to our servers.