Taxes in Monaco

The Direction des Services Fiscaux (DSF) administers Monaco's principal taxes. The Sûreté Publique issues certificates of residence for tax purposes, while the Ministère des Finances et de l'Économie oversees the financial administration. Monaco's indirect taxes include Taxe sur la valeur ajoutée (TVA), registration duties, stamp duties, mortgage and transcription charges, and sector-specific charges on alcohol, beverages, precious metals and insurance. TVA generally follows the French tax base and rates, with special rules for businesses, cross-border transactions and input-tax recovery. A company may owe Impôt sur les bénéfices (ISB), Monaco's corporate income tax, when it carries out industrial or commercial activities in Monaco and at least 25% of its turnover comes from operations outside Monaco. Companies earning income from patents, trademarks, manufacturing processes or literary and artistic rights can also fall within ISB. The standard rate is 25% for financial years beginning on or after 1 January 2022. New activities may qualify for a two-year exemption followed by a preferential regime for three years, subject to the applicable conditions. Companies must usually file an annual ISB return with the DSF within three months after the end of the financial year, or by 1 April of the following year when no financial year closes during the calendar year. They must provide corporate, accounting, management, profit-and-loss, balance-sheet, depreciation, provision and foreign-tax information and retain supporting records. Property and legal transactions can create substantial charges. A qualifying real-estate transfer commonly attracts a 4.75% registration rate, while other transfers may attract 7.5%; transcription is generally charged at EUR 10, or 1% for a TVA-liable transfer of ownership. Registration duties can also apply to notarial and private documents, leases, businesses, wills and company documents. Gifts and inheritances involving property located in Monaco can be taxed regardless of the parties' residence or nationality, subject to the 1950 Franco-Monegasque Convention. Rates depend on the relationship and can range from 0% to 16%; a lifetime transfer under a contrat de vie commune is subject to 4%. A late inheritance declaration can incur 1% per month or part of a month, up to 50% of the basic duty, or EUR 10 per month where no duty is payable. Monégasque nationals and non-French residents of Monaco generally do not pay Monaco personal income tax on private income, net wealth, property ownership or private housing use. French nationals may instead remain liable for French income tax on worldwide income under the 1963 Convention, including where they moved to Monaco or cannot prove the required historical residence exception. Some exceptions apply, including certain people born in Monaco who have remained there continuously, members of the Maison Souveraine and particular Convention cases. A Monaco certificate of residence is not automatically a universal tax-residence certificate for every other country. Residence evidence can include more than 183 days in Monaco, the main centre of activities, the longest period of stay or the household home; false statements can have criminal consequences. International tax obligations may also arise from the source country, another residence country or foreign assets. Monaco and France apply a close customs and tax relationship, and Monaco is not an EU member merely because TVA and customs rules are closely linked to France. France may tax certain capital or intellectual-property income, while qualifying foreign tax may be creditable against ISB when the required proof exists. Monaco also participates in international information exchange, including CRS/AEOI reporting for financial accounts and agreements with numerous countries. Tax treatment should therefore be checked separately for Monaco, France and each relevant foreign country. The DSF may inspect premises and records, correct a return and issue a reasoned notice. A taxpayer normally has 20 days to respond to a notice of adjustment; an unresolved ISB disagreement can proceed to the Commission consultative ISB and then to a formal claim or court remedy. Other administrative decisions may be challenged through a gracieux or hiérarchique appeal and, where available, mediation. Monaco has no general personal tax-refund system, but statutory TVA credits or refunds and foreign-tax credits may apply when their conditions are met.