| Monaco Income Tax for Individuals The Principality of Monaco does not have any direct income tax, nor land and property.
Monaco CoMPANY TAXCompanies do not suffer any direct company tax in Monaco on their profits.
However, if more than 25% of a company's turnover is generated outside of Monaco, then the company is subject to a 33.33% company tax rate.
Monaco VAT RatesMonaco does have a Value Added Tax (V.A.T.). The standard VAT rate is 19.6%, however on most services and products you purchase this will be only 5.5%.
V.A.T. is also applicable for property sales, but any properties over 5 years old are exempt from the tax.
There is no inheritance tax if it is to children or a spouse. For brothers and sisters it is 8%, Uncles, aunts, nieces and nephews is 10%, other relatives is 13%, and non-related person is 16%. There is also tax on the sale of alcoholic beverages.
The normal VAT rate of 19.6% is also the standard rate in France. The reduced VAT rate of 5.5% applies to water, food products, medicines, books, special equipment for handicapped people, hotel accommodation, public transport services and public entertainment services.
Monaco Inheritance and Gift TaxInheritance and gift taxes are only payable by residents on assets situated in Monaco and do not apply to assets located outside the jurisdiction. Payable Monaco City tax arises on a transfer made at the time of a person's death or on a transfer made by way of inter vivos gift.
Gifts located within Monaco which are left to charitable institutions or to the nation are exempt from this tax whether the transfer occurs on death or inter vivos.
The rates of tax payable depend on how close the relationship is between the donor and the donee with the general rule being that the more distant the relationship the higher the tax payable.
The rates payable on transfers of property situate in Monaco whether by way of inter vivos gift or on death are as follows:
- Direct line spouses (wife, parents and children), nil;
- Brothers and Sisters, 8%;
- Uncles, Aunts, Nieces & Nephews, 10%;
- Other relatives, 13%;
- Unrelated persons, 16%.
If the deceased is a French national who had been resident in Monaco for 5 years at the time of his death then assets located in Monaco are governed by the laws of Monaco whereas assets located in France are taxed according to the principles of French tax law.
Monaco does not give tax credits for death duties, inheritance taxes and gift taxes. Thus if a person dies with assets in Monaco and tax has already been paid on the transfer of those assets by the laws of another jurisdiction Monaco will levy its own taxes if tax is payable under its own internal laws.
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