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Monaco Corporate Tax Guide: CIT 25%, Exemption <€100K 2026

Monaco's Corporate Income Tax (CIT) regime features a standard rate of 25% on profits exceeding €1 million, with reduced rates below this threshold. Companies with annual turnover below €100,000 are fully exempt from CIT. Monaco CIT applies only to profits from industrial and commercial activities. Here is how corporate tax works in 2026.

Corporate Income Tax in Monaco was introduced in 1963 under the Franco-Monegasque treaty. CIT applies only to companies engaged in industrial, commercial, or professional activities deriving at least 25% of their revenue from outside Monaco. Passive investment holding companies are generally not subject to CIT. The tax is administered by the Direction des Services Fiscaux (DSF). The tax year is the calendar year. Companies must file annual CIT returns by May 31 of the following year. Filing and compliance guide →

Real-world example: A Monaco-based trading company with annual turnover of €5 million and taxable profit of €800,000 — CIT at 25% on the portion above the threshold. A small consultancy with turnover of €80,000 pays 0% CIT (fully exempt). A company with €500,000 profit pays at the progressive reduced rates. Compare to France where the same profits would incur CIT at 25% (standard rate on all profits) plus potential surcharges. Business sector considerations →

Corporate Tax Rate Structure

  • 0% (exempt): Companies with annual turnover below €100,000 — full CIT exemption
  • Reduced rates: Progressive rates apply on profits between €100,000 and €1 million (approximately 15-20% effective)
  • 25% (standard): Applicable to taxable profits exceeding €1 million
  • Scope: Only applies to profits from industrial/commercial activities with at least 25% revenue from outside Monaco

The CIT system is designed to encourage small local businesses while taxing larger commercial operations that benefit from Monaco's international business environment. Passive holding companies, real estate companies, and certain other entities are outside the CIT net entirely.

Taxable Income and Deductions

Corporate taxable income is calculated as accounting profit adjusted for tax purposes. Key rules include:

  • Depreciation: Standard French-style depreciation rates apply — buildings 2-5%, equipment 10-20%, vehicles 15-25%
  • Interest deductibility: Thin capitalization rules follow French norms (debt-to-equity ratio limits)
  • Loss carryforward: Tax losses can be carried forward indefinitely (subject to annual utilization limits)
  • Dividend exemption: Parent-subsidiary regime exempts 95% of dividends received from qualifying subsidiaries (mère-fille)
  • Capital gains: Treated as ordinary income and taxed at standard CIT rates

Transfer pricing rules follow OECD guidelines. Monaco has a tax ruling system for advance confirmation of tax treatment. The DSF conducts regular audits. Cross-border taxation →

Withholding Taxes on Outbound Payments

Monaco does not impose withholding taxes on outbound payments:

  • Dividends: 0% WHT to both residents and non-residents
  • Interest: 0% WHT to both residents and non-residents
  • Royalties: 0% WHT to both residents and non-residents

This zero-WHT regime makes Monaco a highly attractive jurisdiction for holding companies and intellectual property vehicles. There is no withholding tax leakage on profit repatriation. Investment income guide →

Tax Incentives and Exemptions

  • Small business exemption: Full CIT exemption for companies with turnover below €100,000
  • Holding company regime: Passive holding companies are outside CIT scope entirely
  • Real estate companies: Property holding and management companies may be exempt from CIT (subject to specific conditions)
  • No branch tax: No additional tax on branch profit repatriation

Monaco does not offer specific industry tax holidays but the general regime is already highly favorable for most business activities. The absence of WHT and the narrow scope of CIT (only industrial/commercial activities) means many business structures operate tax-free.

Who needs to register for CIT in Monaco?

Any company engaged in industrial, commercial, or professional activities in Monaco must register with the DSF and the Monaco Chamber of Commerce. Registration is required before starting operations. Companies whose activities fall outside the CIT scope (passive holding, real estate) must still register but may not have CIT liability.

What is the filing deadline for corporate tax?

Annual CIT returns must be filed by May 31 of the following year. Tax is paid in quarterly installments during the year based on the previous year's liability, with a final settlement upon filing. Late filing penalties apply.

Are there any local business taxes in Monaco?

No. Monaco has no local or municipal business taxes, no trade tax, and no professional tax on businesses. The only business-related taxes are CIT (for covered activities) and VAT (French VAT applies). Monaco does not impose the French Cotisation Foncière des Entreprises (CFE) or Cotisation sur la Valeur Ajoutée des Entreprises (CVAE).

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