The tax system in Monaco

Corporate taxation

When it comes to corporate taxation, the tax system in Monaco is also very favorable. Thus, in the context of your company, there is only one situation where you will have to pay a tax: if your company realizes more than 25% of its turnover (in commercial or industrial activities) out of Monaco. In this situation, you will have to pay a tax equivalent to 33.33% of your profits. But again, the Monegasque tax system provides flexibility. Indeed, it is possible to deduct the expenses related to the remuneration before the establishment of the amount of the taxable profit. Thus, a scale exists to establish the amount of deductible expenses for companies whose turnover is less than 3.5 million euros (service companies) or 7 million euros. If your company generates a higher turnover, the international (or European) practices in place will be applied to determine the amount of expenses related to the remuneration to be deducted. This corporate tax also applies to companies located in Monaco whose only activity is to collect income related to patents or literary or artistic property rights. The Principality also encourages the creation of promising companies through its tax policy. Thus, if you create a start-up and you are in the conditions described above, you will not have to pay corporation tax for two years. Then from the third year, a progressive tax (25%, 50%, 75% then 100% in the sixth year) will apply on your profits. If you want to set up a real estate project in Monaco, do not hesitate to contact our real estate agency. We will explain in detail the taxation in Monaco. In addition, we will show you the tax benefits that apply specifically to your situation and we will assist you in your dealings with tax services in Monaco.