How to close a PEL without a real estate project?
Reasons for closing a Housing Savings Plan without a real estate project
First of all, let’s understand what a Housing Savings Plan (PEL). It is a savings product which is used to accumulate funds for a real estate project. However, several reasons can justify closing a PEL without having a real estate project.
An uncompetitive interest rate
THE PEL rate is frozen upon subscription. It should be noted that the PEL recently opened offer relatively low interest rates, leaving significantly less incentive to keep the plan as is. Therefore, if your PEL has an unattractive rate, possibly lower than inflation, it is better to close it to look for other, more profitable savings options.
The PEL ceiling
Another aspect to consider is the PEL ceiling. In fact, the latter is limited to 61,200 euros. Once this amount is reached, you will no longer be able to make payments, and the interest generated is therefore not very high. If you have the capacity to save more, you could consider closing your PEL in order to benefit from other savings products with higher ceilings.
The duration of the PEL
There duration of the PEL can also be a good reason to close the plan without having a real estate project. Thus, if you have a PEL beyond 10 years, the interest accumulated each year is subject to income tax. This taxation may encourage you to close your PEL to avoid this taxation.
The need for liquidity
Finally, an obvious reason to close a PEL without an associated real estate project is the need for liquidity. The sums placed in a PEL are not available at all times, hence the interest in closing this plan if you need these funds for other types of investments or uses.
In short, before deciding to close your PEL, it is essential to carefully evaluate the situation, particularly in relation to these key factors which are the rate, the ceiling, the duration of the PEL and your liquidity needs. It’s also worth exploring other savings or investment alternatives that might better meet your current financial goals.
The tax consequences of closing a PEL without real estate investment
Closing a Housing Savings Plan (PEL) without a real estate project is an important decision that must be carefully considered, particularly because of its tax consequences. Before closing your PEL, it is essential to understand the different tax particularities linked to this type of savings.
The taxation of the PEL
THE PEL is a savings product regulated by the State. Interest is subject to income tax from the first year, but exempt from social security contributions for the first 10 years. Subsequently, in addition to income tax, the interest is also subject to social security contributions of 17.2%.
Closing an ELP: what are the impacts?
Closing a PEL without a real estate investment has several tax consequences. If the PEL is less than 4 years old, the saver will be subject to a penalty of 2.5% on the interest received and this will be included in the net taxable income. On the other hand, if the PEL is more than 4 years old, the saver can close his plan without penalty, but the interest on the latter then becomes taxable and is subject to social security contributions.
The use of the PEL for energy renovation work
Please note that your PEL can now finance your energy renovation work. This is an interesting alternative if you plan to close your PEL without a real estate project. Thus, you can benefit from the tax advantages linked to the energy transition while using your accumulated savings.
Tax environment of the PEL in the context of an inheritance
Let us also not forget that in the event of inheritance, the surviving spouse has the usufruct of cash and bank accounts, including the PEL. Here again, the applicable taxation may vary depending on the length of time the PEL has been held.
In conclusion, closing a PEL without a real estate investment is not a decision to be taken lightly and must be carefully considered taking into account all of these tax consequences. It is advisable to seek professional advice to best assess your options and optimize your tax situation.
How to close a PEL without making a real estate purchase
What is the ELP and what is it for?
THE Housing Savings Plan (PEL) is an interest-bearing savings product whose main objective is to finance the acquisition of housing or the completion of work. A notable feature of the PEL is the possibility of benefiting from a State bonus in the event of taking out a property loan. In doing so, the PEL becomes an essential tool for anyone considering becoming an owner.
Closing a PEL without a real estate project
While becoming a homeowner remains the primary goal of PEL subscribers, plans may change. In this case, the question arises: how to close a PEL without a real estate purchase in perspective? The process is relatively simple: simply make a request to the bank, either by going to the counter or by registered mail with acknowledgment of receipt. However, you must be vigilant and beware of certain pitfalls: for example, closing before the fourth anniversary of the plan can result in the loss of remuneration and the state bonus. Furthermore, the bank cannot close a PEL without the agreement of the holder.
PEL transfer option
Instead of closing the PEL, another way to modify the conditions of this plan is to transfer of PEL to another bank. This can be an interesting alternative for those who want to benefit from better conditions or a better rate.
Upcoming changes for the ELP
Good to know: there is change in the air for the PEL. Soon, it will be possible to use a PEL to finance work without closing it. A boon for those who do not wish to become owners but nevertheless have plans to improve their home. Stay tuned for new developments, as this innovation could revolutionize the way we use the ELP.
PEL: payment obligations and taxation
Finally, it is important to note that a PEL implies an obligation to make payments. In the event of non-compliance with this rule, the bank may close the plan. As for the taxation of the PEL, it changes depending on the age of the plan. From the 12th year, the interest produced is subject to income tax.
In summary, closing a PEL without purchasing real estate is possible, provided that certain rules are respected. As for the future of the ELP, the arrival of reforms could make it possible to use this plan in a more flexible way. It remains to be attentive to future developments.
