Product Spotlight: Plan d’Épargne en Actions (PEA)

A tax-efficient way to invest in European shares

The situation. For French tax residents seeking long-term investments, a PEA can be a good solution, it has even been compared to the UK’s ISA, but with stricter investment criteria. A government-backed savings plan, it offers tax-free growth on EU or EEA-listed shares after five years.

The details. Capital gains and dividends become exempt from income tax after five years, although social charges still apply. Early withdrawals close the plan and trigger tax on gains.

• Contribution limit: €150,000 (€225,000 with a PEA-PME).
• One PEA per person (spouses can each open one).
• Only EU or EEA shares are allowed.
• Must be a French tax resident.

Why it matters. The PEA is one of France’s most effective tools for building a long-term, tax-optimised equity portfolio.