For French investors, this is a difficult pill to swallow. While the PEA is today the most advantageous tax envelope for investing on the European stock market (and even worldwide via ETFs), its advantages have been reduced by the increase in the CSG.
Indeed, the Social Security Financing Law for 2026 increased the CSG by 9.2% to 10.6%mechanically leading to an increase in social security contributions on several investments. The PEA is one of the products affected: withdrawals (for a PEA of more than five years) are now taxed at 18.6%, unlike life insurance which has been saved, retaining its rate at 17.2% (after eight years of holding).
Concretely, how much will this cost?
You should know that this new rate of 18.6% upon withdrawal concerns all capital gains, regardless of the year in which they were generated. So, if you remove €1,000 capital gainyou will have to pay €186 in social security contributionsunlike €172 last year. On larger capital, the gap widens quickly. For €20,000 in winnings, you will pay €3,720 instead of €3,440: €280 more than before!
Let’s take a concrete example. You invested €10,000 in the ETF in January 2022 Amundi PEA MSCI Europe UCITS ETF Acc. So far, you have made 41.26% of added value, or €4,126. You will have to pay €767.26 on these gains, or €57.59 more than the rate of 17.2%, even if the vast majority of this capital gain was created before 2026. A shortfall which can weigh heavily on your exit strategy.
And for a PEA of less than five years? As the tax advantage is only valid at the end of the fifth year, a withdrawal made before this date will cause you to pay the full price: 18.6% social security contributions + 12.8% tax, i.e. 31.4% of flat tax in total. In addition, an exit before 5 years results in the closure of the PEA, so it is absolutely not recommended.
Increase in the CSG: should we adapt our strategy?
If social security contributions must be paid whatever happens, there are still two ways to optimize your PEA. First, think about timing of your withdrawals. If you do not need cash immediately, it is better to let your savings grow, because the tax is only paid upon exit. By reinvesting your PEA capital gains over a long-term horizon, the performance will help to offset this increase.
Then, consider partial withdrawals rather than a total withdrawal. After five years, you can withdraw part of your earnings without closing the PEA. This allows you to spread out the taxation and continue to put the rest of your capital to work tax-free.
