Vanuatu Corporate Tax Guide: 0% CIT — Offshore Financial Center 2026
Vanuatu imposes zero corporate income tax. There is no CIT on company profits, no capital gains tax, and no withholding tax on dividends, interest, or royalties. Companies operating in Vanuatu pay only an annual business license fee of VUV 25,000-50,000 for small businesses. Here is how corporate taxation works in 2026.
Vanuatu is a recognized offshore financial center with a 0% corporate tax regime. The absence of CIT applies to all companies regardless of size, industry, or ownership structure. Unlike many jurisdictions that offer 0% CIT only to specific offshore entities, Vanuatu applies 0% to all companies — both domestic and international. The Vanuatu Revenue & Customs (VRC) manages tax administration, and the Vanuatu Financial Services Commission (VFSC) oversees company registration. The fiscal year is the calendar year. Filing requirements →
Real-world example: A Port Vila-based trading company generates VUV 50,000,000 in revenue with VUV 30,000,000 in expenses, yielding VUV 20,000,000 in profit. CIT: VUV 0. Annual business license fee: approximately VUV 35,000. Total annual tax cost: VUV 35,000. The same company in Fiji would pay approximately 20% CIT = VUV 4,000,000, in Australia 25-30% = VUV 5,000,000-6,000,000. A holding company receiving VUV 10,000,000 in dividends from its Vanuatu subsidiary: 0% WHT on dividends. Cross-border tax guide →
Vanuatu's Zero Corporate Tax Regime
- 0% CIT: No corporate income tax on profits from any business activity
- 0% branch profits tax: No additional tax on branch remittances to head office
- 0% capital gains tax: No CGT on sale of business assets, shares, or intellectual property
- 0% withholding tax: No WHT on dividends, interest, or royalties paid to residents or non-residents
- No thin capitalization rules: No restrictions on debt-to-equity ratios for tax purposes
- No transfer pricing rules: No specific transfer pricing legislation (though general anti-avoidance may apply)
The only recurring corporate cost is the annual business license fee, which ranges from VUV 25,000 to VUV 50,000 for small businesses and higher for larger enterprises and international companies. There are no tax treaties with major economies, but this is largely irrelevant given the 0% CIT rate.
Company Registration and Business License
- Company registration: Companies are registered with the VFSC. Registration fee depends on authorized capital
- Annual business license: Required for all businesses. Fee: VUV 25,000-50,000 for small businesses, higher for larger companies
- International companies: Exempt companies and international business companies (IBCs) have different fee schedules but all pay 0% CIT
- Renewal: Business licenses must be renewed annually by March 31
Failure to register or renew a business license results in penalties. The VFSC maintains a public register of companies. Foreign companies may also register branches in Vanuatu.
Financial Reporting and Audit
- Annual returns: Companies must file annual returns with the VFSC containing financial statements
- Audit requirement: Companies above certain thresholds must have audited accounts. Smaller companies may file unaudited statements
- Record keeping: Companies must maintain proper accounting records for at least 7 years
- VAGST registration: Companies with annual turnover exceeding VUV 3,000,000 must register for VAGST (12.5%)
While there is no CIT, companies must still maintain proper books and records for VAGST purposes and VFSC compliance. The VRC conducts VAGST audits and may impose penalties for non-compliance.
Does Vanuatu really have 0% corporate tax?
Yes. Vanuatu has no corporate income tax law. There is simply no legislation imposing tax on corporate profits. This is well-established and has been the case since before independence. The government generates revenue through VAGST (12.5%), business license fees, import duties, and other consumption-based taxes.
Can I use Vanuatu as a holding company jurisdiction?
Yes. Vanuatu is a popular jurisdiction for holding companies and international business companies. With 0% CIT, 0% WHT on dividends, and no CGT, Vanuatu is an efficient jurisdiction for holding investments, intellectual property, and intercompany financing. There are no controlled foreign company (CFC) rules in Vanuatu.