Monaco Tax System: Personal Income, Corporate Tax and VAT

Verified overview

Monaco's tax system is defined by the absence of personal income tax for non-French residents, together with no wealth tax, no annual property tax and no individual capital gains tax. Companies and VAT, however, are fully taxed — often at the same rates as in France.

Official sources: Direction des Services Fiscaux de Monaco (gouv.mc), MonEntreprise, Franco-Monegasque Tax Convention of 18 May 1963.

Personal income tax

Monaco levies no personal income tax. This applies to every category of income:

• salaries and wages
• self-employment income
• investment income (dividends, interest, capital gains)
• rental income from Monaco property
• pensions

Exception: French nationals

French nationals who became Monaco residents after 13 October 1962 remain subject to French income tax under the Franco-Monegasque Tax Convention of 18 May 1963. They must declare their worldwide income to the French tax authority as if they were resident in France. French nationals settled in Monaco before that date (and their qualifying descendants) enjoy the same treatment as other residents.

Important: absence of Monaco tax does not relieve a resident from potential tax obligations in another country where they keep fiscal residence, a permanent establishment, or economic ties. Professional tax advice is essential before relocating.

Corporate profit tax (Impôt sur les Bénéfices — ISB)

Contrary to a common misconception, Monaco is not a corporate tax haven. The ISB applies in two main cases:

1. The 25% rule: companies deriving more than 25% of turnover from outside Monaco are subject to ISB.
2. Activity-based rule: certain industrial, commercial and royalty activities are taxable regardless of the turnover split.

The ISB rate is 25% (progressively aligned on the French corporate tax rate, which fell to 25% in 2022). Companies whose activity is entirely Monaco-based (local clientele only) are in principle outside the ISB scope.

Value Added Tax (VAT)

Monaco applies French VAT as part of the customs union with France. There is no specific Monaco 0% VAT regime.

VAT is included in displayed prices, as in France. Monaco companies file VAT returns with the Direction des Services Fiscaux.

Capital gains, dividends and investments

For resident individuals (excluding French nationals):

• Capital gains on securities and real estate: not taxed in Monaco.
• Dividends received: not taxed in Monaco.
• Interest and capital income: not taxed in Monaco.

These rules apply subject to tax treaties and residence rules of other jurisdictions.

Inheritance and gift tax

Only assets physically located in Monaco are concerned. Rates depend on the relationship:

What does not exist in Monaco

• No wealth tax
• No annual property tax
• No housing tax
• No individual capital gains tax
• No specific zero-rate VAT

International transparency and cooperation

Since 2017, Monaco takes part in the OECD automatic exchange of information (Common Reporting Standard). Monegasque banks report annually to the authorities information on accounts held by non-residents, which is then shared with their home tax administrations. Monaco has also signed numerous bilateral tax-information exchange agreements.

Verify directly with official sources

Tax rules evolve. Before any wealth or relocation decision, consult:

• the Direction des Services Fiscaux (gouv.mc)
• MonEntreprise for corporate taxation
• a licensed tax advisor in Monaco
• your home tax authority for reporting obligations