{"id":8747,"date":"2023-09-24T21:35:17","date_gmt":"2023-09-24T21:35:17","guid":{"rendered":"https:\/\/monaco-consulate.com\/redesign\/?page_id=8747"},"modified":"2024-06-21T19:06:28","modified_gmt":"2024-06-21T19:06:28","slug":"tax-system","status":"publish","type":"page","link":"http:\/\/monaco-consulate.com\/redesign\/tax-system\/","title":{"rendered":"Tax System"},"content":{"rendered":"<section class=\"l-section wpb_row us_custom_1250758a height_large\"><div class=\"l-section-h i-cf\"><div class=\"g-cols vc_row via_grid cols_1 laptops-cols_inherit tablets-cols_inherit mobiles-cols_1 valign_top type_default stacking_default\"><div class=\"wpb_column vc_column_container\"><div class=\"vc_column-inner\"><div class=\"wpb_text_column\"><div class=\"wpb_wrapper\"><p>The following types of tax, applicable in other countries, are not applicable in the Principality of Monaco:<\/p>\n<p>\u2013 Income tax<br \/>\n\u2013 Wealth tax<br \/>\n\u2013 Land tax<br \/>\n\u2013 Housing tax<br \/>\n\u2013 Television tax<\/p>\n<h2><a name=\"profit_tax\"><\/a><strong>Profits Tax<\/strong><\/h2>\n<p>Companies of any type which carry on a commercial or industrial activity on the territory of the Principality are subject to tax at the rate of 33.33% when at least 25% of their turnover is generated by operations outside Monaco<\/p>\n<p>In 1991, fiscal arrangements were instituted relating to the formation of companies which allow for the exemption of profits made during the first two years and partial taxation only of the profits of the next three years.<\/p>\n<p>In addition, an extra and specific reduction is provided for in the case of scientific and technical research activities.<\/p>\n<p>Administrative offices, which are not basically commercial, are not subject to a tax on profits, but to a levy of 2.66% of the total of the expenses incurred in running the office.<\/p>\n<p>Dividends paid by Mon\u00e9gasque companies to their shareholders are not taxed.<\/p>\n<h2><a id=\"individual_tax\" name=\"individual_tax\"><\/a><strong>Individual Tax<\/strong><\/h2>\n<ul>\n<li>INCOME TAX<\/li>\n<\/ul>\n<p>Income tax in the Principality of Monaco was abolished in 1969, under the Sovereign Order signed by H.S.H. Prince Charles III.<br \/>\nThe general rule is still applicable for Mon\u00e9gasque citizens and all other foreigners, except French citizens who have become residents since January 1957 who continue to be liable for French income Tax.<\/p>\n<ul>\n<li>INHERITANCE TAX<\/li>\n<\/ul>\n<p>Mon\u00e9gasque law makes no provision for inheritance tax and claims no tax on direct donations or on donations between husband and wife. The tax due in other cases of donations is attractively low:<\/p>\n<p>\u2013 Brothers and sister 8%<br \/>\n\u2013 Uncles, aunts, nieces and nephews 10%<br \/>\n\u2013 Collateral other than sisters, brothers,<br \/>\nuncles, aunts, nieces and nephews 13%<br \/>\n\u2013 Non-related persons 16%<\/p>\n<p>Transfer dues, according to internal Mon\u00e9gasques law, only apply to real estate located in the Principality of Monaco or with situs in Monaco at the date of Death or donation, whatever the place of residence and nationality of the deceased or donator.<\/p>\n<h2><strong><a id=\"vat\" name=\"vat\"><\/a>Value Added Tax<\/strong><\/h2>\n<p>The existence of the French-Mon\u00e9gasque Customs Union means that V.A.T. is applicable at the same rate as in France. European community tax is applicable since<br \/>\nJanuary 1, 1993.<\/p>\n<p>The following are subject to V.A.T.:<\/p>\n<ul>\n<li>On the one hand, the operations due to economic activity carried out for a fee by a tax payer, i.e. by a person acting on an independent basis as of custom or occasionally, whatever his legal status;<\/li>\n<\/ul>\n<ul>\n<li>On the other hand, the operations expressly named by law as being subject to V.A.T. (delivery of goods to oneself, certain purchases, imports\u2026)<\/li>\n<\/ul>\n<ul>\n<li>And lastly, operations which would normally be exempt, but which become eligible for the application of V.A.T. according to a choice made by the person carrying them out (operation carried out by persons performing exempted commercial activities, banking and financial establishment operations, empty property rentals for industrial, commercial or professional use).<\/li>\n<\/ul>\n<p>The most frequently applicable rates are as follows:<\/p>\n<p>Normal rate 20.6%<br \/>\nReduced rate 5.5%<\/p>\n<p>The normal rate, 20.6% is used when there is no reason to apply the reduced rate.<\/p>\n<p>The reduced rate, 5.5% is applicable as follows:<\/p>\n<p>\u2013 On various services: transports of travelers, hotel or furnished accommodation, certain shows (cinema, theater, concert\u2026), entrance fees for certain attractions (museums, monuments, cultural exhibition), private television subscription, provision of meals in works cafeterias, services related to the supply and evacuation of water;<\/p>\n<p>\u2013 On certain products: water, food products (except alcoholic beverages and certain solid food product), medicines (except medicines which are reimbursed to social security contributors belonging to the 2.10% category), products with agricultural origins, books, special apparatus and equipment for the handicapped, certain products for animal feed.<\/p>\n<h2><strong><a id=\"miscellaneous\" name=\"miscellaneous\"><\/a>Miscellaneous<\/strong><\/h2>\n<p>&nbsp;<\/p>\n<ul>\n<li>PROPERTY ADDED VALUE TAX<\/li>\n<\/ul>\n<p>V.A.T. is applicable on operations contributing to the production and commissioning of real estate.<\/p>\n<p>It is based on:<br \/>\n\u2013 The sales price, the amount of compensation or the value of the social rights corresponding to the gain, plus the additional charges;<\/p>\n<p>\u2013 The real, venal value of the property, if this real market value is higher than the price, the amount of the expenses or the value of the social dues, increased by the charges.<\/p>\n<p>V.A.T. is generated by the act which defines the transaction, or if no such act exists, the transfer of ownership.<\/p>\n<p>However, V.A.T. is not applicable to operations involving buildings or parts of buildings of over five years of age or, which, during the five years following completion, have already been sold to a person other than an estate or property agent. Such operations are normally subject to transfer dues.<\/p>\n<p>The V.A.T. rate applicable on property transactions, whatever their nature, is 20.6%.<\/p>\n<ul>\n<li>REGISTRATION DUTY, FISCAL STAMPS AND VARIOUS TAXES AND LEVIES<\/li>\n<\/ul>\n<p>Registration duty is levied on formalities to register transfers or civil or legal acts. It is either proportionate or a fixed amount.<\/p>\n<p>Some of the most frequently used rates of taxation are as follow:<\/p>\n<p>* 1% on leases,<br \/>\n* 2% on judgments with conviction,<br \/>\n* 3% on acts containing mortgage commitments for the engrossed documents,<br \/>\n* 5% on movable property sales, duty is reduced to 2% in the case of certain public sales and auctions,<br \/>\n* 6.5% on the sale of real estate,<br \/>\n* 7.5% on property transfers entailing the sale of commercial establishments,<br \/>\n* 1% transaction fees on real estate transfers,<br \/>\n* 0.65% mortgage subscription fee.<br \/>\nFixed duties; a general fee of 5 Francs.<\/p>\n<p>Fiscal stamps are placed on all documents for civil or legal acts and inscriptions which can be produced as evidence before a court of justice<\/p>\n<p>The cost is either fixed or depends on the format of the document established. Fiscal stamps are also a form of duty for this accomplishments of administrative formalities (certificate of residence, work permit, Livret de Famille, passport).<\/p>\n<p>Registration of the following documents is compulsory and must be accomplished within the appropriate time limits:<\/p>\n<p>\u2013 public acts drawn up by notaries or bailiffs ,<br \/>\n\u2013 legal acts,<br \/>\n\u2013 private acts for leases, sales commercial establishments, wills,<br \/>\n\u2013 real estate transfers concerning living persons when the real estate is located in the Principality of Monaco,<br \/>\n\u2013 certain company acts.<\/p>\n<p>Other acts may also be subject to registration, but it is not compulsory unless the said document is to be produced before justice or the authorities.<\/p>\n<p>Other taxes and duties are also levied:<\/p>\n<p>\u2013 corporation dues on the manufacture, circulation and consumption of alcohol,<br \/>\n\u2013 warranty tax on manufactured metal goods,<br \/>\n\u2013 duties on alcoholic beverages,<br \/>\n\u2013 warranty tax on precious metal goods.<\/p>\n<p>In the Principality of Monaco, these taxes and duties are subject to the same regulations as in France. They are established on the same basis and applied at the same rate. Since January 1, 1993, the general conditions for the exchange of products subject to excise within the European Community are also applicable in Monaco.<\/p>\n<p>It is not compulsory to register the following types of documents:<\/p>\n<p>\u2013 public administration and general interest documents,<br \/>\n\u2013 civil status documents and the issues of certified copies of the same,<br \/>\n\u2013 passports,<br \/>\n\u2013 mortgage registration statements, mortgage transcripts, certificate of non-registration as a mortgage delivered by the Registrar.<\/p>\n<p>For more information, please contact the Tax Department:<\/p>\n<h2><strong>Direction des Services Fiscaux<\/strong><\/h2>\n<p>57, rue Grimaldi<br \/>\nMC 98000 Monaco<br \/>\nPrincipality of Monaco<br \/>\nTel: 011.377.93.15.81.04 or 24<\/p>\n<p>Fax: 011.377.93.15.81.55<\/p>\n<\/div><\/div><\/div><\/div><\/div><\/div><\/section>\n","protected":false},"excerpt":{"rendered":"The following types of tax, applicable in other countries, are not applicable in the Principality of Monaco: \u2013 Income tax \u2013 Wealth tax \u2013 Land tax \u2013 Housing tax \u2013 Television tax Profits Tax Companies of any type which carry on a commercial or industrial activity on the territory of the Principality are subject to...","protected":false},"author":3,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"footnotes":""},"class_list":["post-8747","page","type-page","status-publish","hentry"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.6 - 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