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Monaco, known for its casino, the Formula 1 race, and many other events, has been the hotspot for wealth and luxury for decades. The small city-state has become increasingly popular over the past few decades, primarily due to its advantageous tax system, and now has the highest density of millionaires worldwide.
Below is a comprehensive guide to the most important taxes in Monaco, their benefits, and how to take advantage of them.
History
The emergence of the Monegasque tax system is the result of historical developments, political decisions, and economic strategies. The abolition of income tax in 1869, financed by casino revenues, was a decisive step that made Monaco a tax haven. The principality's tax advantages have been maintained over the years and have made Monaco one of the most sought-after places to live for wealthy individuals worldwide.
Taxes & Benefits of Monaco
Monaco is known for its favorable tax system, which particularly attracts wealthy individuals and businesses. Here are the main types of taxes in Monaco and their benefits:
Income Tax
Monaco levies no income tax on personal income, with one exception for French citizens residing in Monaco who are taxed under a special bilateral agreement.
Advantages: The lack of income tax makes Monaco an attractive place of residence for wealthy individuals and families, allowing them to keep their income and capital largely tax-free.
Wealth tax
In Monaco there is no wealth tax, which means that resident individuals do not have to pay taxes on their total wealth.
Advantages: This is particularly attractive for affluent individuals holding large fortunes, as they do not have to pay annual taxes on the value of their assets.
Inheritance and gift tax
Monaco does not impose an inheritance tax on direct descendants (e.g., children). For other heirs, there are graduated rates ranging from 8 % to 16 %, depending on the degree of kinship.
Advantages: The tax advantages of inheritances make Monaco a preferred location for transferring wealth across generations, especially for families wishing to pass on high values.
Corporate income tax
Companies operating in Monaco that generate more than 25 % of their revenue outside Monaco must pay a corporate income tax of 33.33 %. Companies that generate all of their revenue within Monaco are exempt from this tax.
Advantages: The tax exemption for companies operating locally in Monaco encourages business establishment and can lead to the accumulation of wealth without it being skimmed off in the form of corporate taxes.
Value Added Tax (VAT)
Monaco levies a value-added tax (TVA) of 20 %, which is modeled after the French value-added tax system. This tax applies to the consumption of goods and services.
Advantages: Although the VAT in Monaco is the same as in France, the low tax environment for income and wealth remains a decisive factor for many individuals and businesses, which puts the higher consumption taxes into perspective.
Capital Gains Tax
There is no capital gains tax in Monaco, neither for domestic nor for foreign income.
Advantages: The possibility of realizing capital gains tax-free is another reason why wealthy investors choose Monaco as their residence.
Tax calculator
To easily calculate the tax burden in Monaco, we have developed the following tax calculator. By entering the specified sources of income, you can calculate the effective tax burden.
Global Setup · Monaco
Estimate your tax burden as a (non-French) resident of Monaco—0% income tax since 1869; the only relevant factor is corporate income tax.
earned income
0%No income tax for residents - neither on salary nor on capital, dividend, or crypto income. In the case of local employment, social security contributions apply (CAR/CCSS).
Corporate profit
0% / 25%ISB applies only if more than 25% of revenue is generated outside Monaco (or in the case of IP/licensing income). Purely local companies (≥ 75% in Monaco revenue) are subject to 0%. Newly established companies: 0% in years 1–2, then on a sliding scale. Pillar Two has not been implemented.
Dividends
0%Dividends are tax-free for residents (0%), both domestic and international. Monaco does not impose withholding tax. Note: Foreign withholding tax may apply to U.S./Swiss dividends, which is often non-refundable due to the absence of a double taxation agreement.
Crypto gains
0%Private crypto gains are tax-free for residents. As of January 1, 2026, the EU reporting protocol CARF (reporting of digital assets) will apply—a reporting obligation, not a tax obligation.
Capital gains
0%Capital gains are tax-free for residents regardless of the holding period or amount (0%)—including real estate, stocks, and business sales.
Effective tax rate
Note: This calculation applies to non-French residents. Under the 1963 agreement, French citizens remain subject to income tax in France—Monaco’s 0% rule does not apply to them. Non-binding estimate based on current Monegasque law (as of 2026): 0% income tax, capital gains tax, dividend tax, and crypto tax; no wealth tax or annual property tax. Corporate income tax (ISB) of 25% applies only if foreign revenue or IP income exceeds 25% (purely local operations are 0%; newly established companies are subject to a graduated rate). Social security contributions ~11.7% (employees) or ~24% (self-employed). Not shown: VAT 20%, 1% rental tax, inheritance/gift tax (0% for direct heirs, up to 16% for non-relatives), and foreign withholding taxes. This calculation replaces no individual tax advice. For a binding assessment, please book a consultation.
Prerequisites – Monaco Residency
Summary
Monaco offers a tax-friendly environment, particularly due to the absence of income tax, wealth tax, and capital gains tax. This attracts wealthy individuals and families who want to protect and grow their wealth effectively while living in a stable and secure environment. The favorable inheritance tax regulations also support the transfer of wealth within the family. For companies, the Monégasque tax system offers incentives, especially when revenue is generated primarily locally.
