The little brother of du PEA is sometimes misunderstood or unloved, but has real advantages. It is renowned for its attractive taxation, and behind an apparent rigidity, offers some surprising flexibility in terms of management.
The main attraction of the PEA-PME lies in its taxation, total exemption from income tax for withdrawals as soon as the plan is 5 years old. Five years after the first payment, it is now possible to make partial withdrawals without closing the Plan, while retaining the right to additional payments.
In any case, it will still be necessary to pay social security contributions on capital gains during withdrawals, which currently amount to 17.2%. It should be noted, however, that the Plan makes it possible to defer the payment of the said social contributions to the date of the withdrawal, whereas on a securities account each transfer is likely to trigger the payment of these social contributions in addition to tax. This secondary advantage, the deferred payment, could seem anecdotal in period of zero rate, but takes again all its direction now that the loan of money is again remunerated. For an investor who would only leave his PEA-PME in 10 years, this “free credit” valued at 3.5% per year still represents an economic advantage of 35% on the social security contributions that he should have paid into account. securities.
What is the difference with the classic PEA?
The most obvious advantage is the payment ceiling which amounts to €225,000 per person for the PEA-PME against only €150,000 for the classic PEA. Be careful, however, of the overall ceiling provided for by the regulations, the accumulation of payments on the PEA-PME and the PEA must not exceed €225,000. Suffice to say that, for the taxpayer who has already maximized his payment ceiling on the PEA, there remains only €75,000 of available tax to deposit on the PEA-PME.
In terms of authorized investment universe, the two PEAs are significantly different. Because if the classic PEA requires to be invested in European equities, the PEA-PME imposes additional restrictions, but also some interesting niches. The PEA-PME is normally restricted to investment in eligible SMEs or medium-sized enterprises (ETI). The notion of SME-ETI is fortunately relatively broad. To be housed in a PEA-PME, the company must have its headquarters in the European Union, employ less than 5,000 people, achieve less than 1.5 billion euros in turnover or have a lower balance sheet total to 2 billion euros. Investment funds made up of at least 75% eligible securities are also authorized.
A popular tool for business leaders
Since its launch in 2014, the PEA-PME has had relative success with the general public, with competition from its big brother, the classic PEA, which is perceived as more flexible. It is of particular interest to investors for whom the limit of €150,000 is too low, but it has also aroused the interest of a large number of business leaders. The latter are often eager to house their company’s securities there, in order to benefit from the associated tax advantages.
Be careful, however, to ensure that you respect the eligibility constraints. Shares are eligible for the PEA-PME, excluding preference shares, investment certificates, but also shares in SARLs or SELARLs, as well as shares in cooperative societies. It is prohibited to hold or familiarly control more than 25% of the company housed in a PEA-PME. It should be noted that the pledge of the PEA or the PEA-PME does not entail the closure of the plan, except execution of the guarantee. This can allow some entrepreneurs to raise cash without having to sell their securities.
What management solutions beyond equities?
Investors who have made their PEA-PME profitable over the years no longer necessarily want to be 100% exposed to the stock market, and moreover to small caps, which represent the most volatile segment of the stock market. First of all, there is a universe of 84 eligible mutual funds, whose risk-return ratio is very varied. On the other hand, no monetary fund is accessible via the PEA-PME, whereas there are several eligible on the classic PEA. But other types of securities can diversify portfolios. Since 2019, certain bonds have been eligible for the PEA-PME! The PACTE Law provides for the admission of fixed-rate bonds resulting from crowdfunding that meet certain technical conditions. But this is not the only little-known “niche”, since unlisted Minibons and bonds redeemable in shares (ORA) are also eligible. Some establishments also offer management mandates.
In summary, the PEA-PME is a tool that is perhaps unjustly misunderstood, which is not just a “sub-PEA” for those who use all of its flexibility and subtleties. Its attractive tax system and its derogatory ceiling of €225,000 are its main advantages.