First of all, you should know that you can keep your share savings plan (PEA), as specified on the government's tax website : Can I keep my PEA (share savings plan)? | impots.gouv.fr
1. How is my PEA taxed?
Visit Franco-German tax treaty indicates that capital income (Interests, dividends, capital gains) are taxable in Germany if you have your tax residence.
When you lived in France, the PEA taxation was quite interesting During the PEA duration, the dividends and capital gains generated by investments under the plan are not not taxable, provided that they are reinvested in the PEA. If you remove‘silver of your PEA after his first five years existence, the earnings are exempt tax on the income.
Visit Germany such a device’does not exist. Earnings are taxed progressively at a single rate of 26.375% (25% Kapitalertagsteuer + Solidaritätszuschlag)
2. Income from securities held in a securities account is taxed directly.
You still have the right to a allowance it 1000€ by person (the children too! Provided the booklet or in their name) for all your capital income (Livret A, PEA, PEL etc.)
Brief no tax benefits to hold a PEA when you live in Germany.
And this complicates even your situation :
L’single tax form (IFU) provided by your bank is perfect for filling your French declaration ...but not the German one.
It lists only investment income taxable according to French taxation (and therefore omits revenues who are taxable in Germany : interest from Livret A, the withdrawals as part of a PEA before 5 years, the interest accumulated on your Plan d'Epargne Logement (PEL), if over 12 years of age.
It's not easy to fill in the German statement on this basis.
3. A German broker gives you a Steuerbescheinigung
L’usefulness of this paper? It tells you exactly which income goes in which case. The taxes from capital income can be quite complex... And it's not always easy to keep track of the different amounts to declare, the tax-exempt amounts, etc.
Visit PEA also makes things difficult for you, as the revenues are subject to social security contributions regardless of the date of withdrawal.
As a non-resident you don't have to pay them. You must check with your bank that they are not automatically deducted from your account. reimburse otherwise.
And then the PEA rules are a little binding for example, all titles cannot be included, and the partial withdrawals before the age of 5 lead to plan closure.
4. So what do we do?
The PEA offers no tax advantages in Germany, and complicates the tax return - its local equivalent (Depot) is also taxed, although the return is simpler.
But that doesn't mean it's impossible to optimize your tax situation while investing in dynamic investment vehicles. There are other tax wrappers, such as life insurance (gains are not taxed until the money is withdrawn, which allows compound interest to work at full speed) or certain German pension insurance contracts (same thing, but contributions are deductible, the Finanzamt refunds up to 47% of your stake)
And beyond taxation, retirement planning is an essential subject when living and working in Germany. The rules between France and Germany are very different, so it's best to get started early. Read our article dedicated to calculating the France-Germany pension.
Contact Expat Finance for a personalized study, we'll be able to tell you whether it's better to close your PEA or not, whether it's worthwhile having a Depot, a French or German life insurance policy, or whether a retirement savings plan is right for you.
