Procedure How to declare and pay corporate income tax

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Contact details

Direction des Services Fiscaux

Le Panorama
57 rue Grimaldi
MC 98000 MONACO

Department of Tax Services :
(+377) 98 98 81 21
(+377) 98 98 81 22

Fax : (+ 377) 98 98 81 55

Opening Hours : from 9h30 to 17h00 from Monday to Friday

Send us an email

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Direction des Services Fiscaux

Le Panorama
57 rue Grimaldi
MC 98000 MONACO

Opening Hours : from 9h30 to 17h00 from Monday to Friday

Phone : (+ 377) 98 98 81 21

Phone : (+ 377) 98 98 81 22

Fax : (+ 377) 98 98 81 55

Send us an email
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Principle and conditions

Scope

In accordance with Article 1 of the tax treaty between France and Monaco of 18 May 1963 corporate income tax was introduced in the Principality by the  Ordinance no. 3.152 of 19 March 1964 instituting a profit tax .

The following entities are subject to this tax:

  • Companies of any legal status that carry out industrial or commercial activity, where at least 25% of the turnover is generated outside Monaco
  • Companies whose income relates to the sale or licensing of patents, trademarks, processes or formulas and to the royalties from intellectual property rights

Administrative offices are also subject to this tax but it  is applied  according to the specific terms relevant to their situation. The tax is determined by a flat rate, generally equal to 8% of the total annual operating expenses.

How taxable profit is calculated

Taxable profit is calculated according to the profits derived from activities of any nature carried out by the company. It is determined after deduction of all costs. However, specific rules mean that the salary of the owner or directors can only be deducted for individuals who carry out a real function within the company and at a total value that is reasonable for their role.

For small businesses (defined as companies with a turnover of less than €3.5 million for the provision of services or €7 million for other activities) a scale determines the maximum amount of deductible income per turnover bracket. For other companies the director’s salary can only be deducted from taxable profits if the amount is not excessive in comparison to recognised practices on an international level, particularly within the European Union.

Rate of taxation

The rate of taxation is 33.33%  of profit after deductions.

1

Obtaining and completing the forms

To get the form you can either:

  • Or collect it from the Department of Tax Services 

2

Collating the documents

  • You must provide:
  • The completed declaration of profits form
  • Certified true copies of: 
    • The income statement
    • The balance sheet
    • The profit and loss statement
    • The attendance register of the assembly where the results for the year were discussed, along with reports and extracts of the discussions of board meetings and of the shareholders’ assemblies
  • A statement of depreciation and of provisions deductions applicable
  • A statement of the main general  and administrative expenses of the company

Where necessary, you should also provide :

  • The completed form  “Declaration of payments made during the year”
  • A commitment to reinvest the capital gains of sales of parts of the fixed asset
  • A  carryback of loss option and a statement of determination of allocated profit and of the debt resulting from the carryback
  • A detailed statement of the research tax credit calculation
  • Evidence of taxes paid abroad

3

Submitting the declaration

You must submit in person or post your declaration and all supporting documents to the Department of Tax Services in the final three months of the accounting period (before 1 April of the following year if the period coincides with the calendar year).

4

Paying your coporate income tax

Tax is calculated following a declaration of taxable income and the tax balance (with provisional instalments deducted) must be settled within the aforementioned three months by cheque or bank transfer or in cash.

Along with payment you must submit a “Bordereau de règlement de l’impôt sur les bénéfices”. To obtain this you can:

Corporate Income Tax requires the payment of provisional tax instalments. Payment of these instalments must be made in the months of February, May, August and November of each year.  Every instalment is equal to 20% of the tax calculated on taxable profit on closing of accounts at the end of the previous financial year.

 

Tax relief

There are two categories of tax relief in the Principality of Monaco:

  • Business start-up scheme     
  • Research tax credit  
Last update: 03/12/2015

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