Some people imagine Monaco as a principality where one does not pay anything. Others think that it is a territory reserved for the ultra-rich. The reality is both more advantageous and more nuanced than what one believes. There is indeed no income tax for the large majority of residents, and transmitting one’s patrimony to one’s children costs no euro in inheritance rights. But Monaco is not a tax lawless zone, and everyone does not benefit from the same advantages depending on their nationality. This guide explains everything.
According to the Princely Government of Monaco, residents of the Principality are subject to no income tax, whether it is salaries, dividends, capital gains or interests. If you receive 500,000€ of investment income in the year, these 500,000€ remain in your pocket without local levy of any kind.
This exemption applies to all resident nationalities, except two major exceptions detailed below. The only condition is that residence in the Principality is effective and real.
If you are a French national, this section deserves particular attention because it changes the situation. The Franco-Monegasque Convention of 18 May 1963 stipulates that French citizens domiciled in Monaco are, except rare exceptions, considered fiscally domiciled in France. They therefore remain subject to French income tax on the entirety of their worldwide incomes, and the Monegasque residence card is not enough to erase this obligation.
Only French citizens born in the Principality having never moved their tax domicile to France are exempt, as well as those who can justify five years of residence in Monaco at 31 October 1962, a case which today concerns a handful of persons. This does not mean that Monaco has no interest for a French national: as we will see further, inheritance advantages remain very significant. But it would be dishonest not to pose this point from the beginning.
American citizens are in an analogous situation, although for a different reason. The United States applies taxation based on citizenship and not on residence, which means that no matter where you live in the world, the American tax administration continues to exercise its right of taxation on your worldwide incomes. There is no local Monegasque tax on your personal incomes, but your country of origin does not let go for all that.
For any American resident envisaging Monaco, an in-depth international fiscal planning with a specialist is indispensable before any installation decision.
The Principality does not know neither tax on fortune, nor equivalent of the IFI (Real Estate Fortune Tax) in force in France. No annual tax applies to the value of the patrimony held, whether it is real estate, financial or movable. A resident who holds an apartment in Monte-Carlo valued at 8 million euros, a stock portfolio of 5 million euros and shares of foreign companies for 3 million euros additional does not pay one euro of annual tax for the simple holding of this patrimony.
On a generation, the economy realized compared to other European countries is considerable, and contributes to making Monaco one of the most sought-after patrimonial destinations in the world.
If you are French and reside in Monaco, the convention of 1963 continues to produce its effects on this point also. You remain subject to French IFI on your real estate goods located in France and abroad, and must declare all your real estate assets according to French rules, independently of your effective residence.
The residents of other nationalities, they, are totally exempt from any tax on fortune or real estate, including for goods held outside Monaco. This difference of treatment is a central factor in decisions of patrimonial restructuring of international families.
Monaco does not collect neither property tax nor housing tax. That your good is occupied all year, used punctually as secondary residence or put in rental, no recurrent local contribution is demanded from you. This non-existent cost item strongly contrasts with the French model, where the simple fact of possessing or occupying a good leads to annual charges which can quickly become significant on high patrimonies.
VAT applies to sales of new goods or completed less than five years ago, at a rate of 20% aligned with the French regime. What changes everything for the buyer is that this tax is due by the seller, that is to say the promoter, and not by you. In new programs listed in the Real Estate Observatory 2025 of IMSEE, such as Bay House in La Rousse or Palais Ninetta in Moneghetti delivered in 2025, the displayed price is a price all taxes included. You do not have to take out 20% additional at acquisition.
Beyond five years after completion, transactions are no longer subject to VAT and switch to the regime of transfer rights.
For old goods or resales, it is the transfer rights which apply, at the charge of the purchaser. As physical person or via a civil company registered in Monaco, total acquisition costs reach 6.25% of the price of the good, decomposed into 1.5% notary fees and 4.75% registration rights. For a new good or in future state of completion, these costs are limited to 2.5% (1.5% notary and 1% registration right).
To this are added agency fees, fixed by the Monegasque Real Estate Chamber at 3% excluding tax at the charge of the purchaser, as well as a mortgage registration right of 0.92% in case of financing by loan.
It is one of the most unknown points of the Monegasque system: real estate capital gains are not taxed for non-French residents. If you have acquired an apartment at Larvotto for 4 million euros ten years ago and you resell it today at 9 million euros, the 5 million gain returns to you integrally, without taxation of any kind.
On a market where the average price per square meter exceeds 57,569 euros and reaches 71,167 euros at Larvotto according to the Real Estate Observatory 2025 of IMSEE, potential capital gains are substantial. Not taxing them represents a considerable patrimonial advantage on duration.
In Monaco, inheritance rights and donation rights apply only to goods located on the territory of the Principality, whatever be the domicile, residence or nationality of the deceased or donor. If you reside in Monaco but hold listed shares abroad, an apartment in Italy or liquidity on a Swiss account, these assets do not enter in the base of Monegasque rights. Only goods whose base is located in the Principality are concerned.
This territorial principle offers a real latitude in the structuring of a patrimony in view of its transmission.
The figures are often those which make open the eyes. In direct line, that is to say between parents and children or between spouses, inheritance rights and donation rights are 0% according to the Princely Government of Monaco. A Monegasque apartment transmitted to a child therefore generates no fiscal cost, whatever its value. Between brothers and sisters, the rate is 8%, between uncles or aunts and nephews or nieces it reaches 10%, and between persons without family link it culminates at 16%.
To appreciate what this represents concretely, retain simply that on a real estate patrimony of 10 million euros transmitted to a child in Monaco, the rights due are null, where other European countries provide progressive scales which can reach very high levels on large fortunes.
For successions involving French nationals, the bilateral Convention of 1 April 1950 distributes the right of taxation according to the geographical location of goods. Those located in Monaco fall under Monegasque law, those located in France fall under French law. A Franco-Monegasque family can thus anticipate the localization of its real estate assets to orient the succession taxation applicable.
Furthermore, Monegasque law n° 1.448 of 28 June 2017 allows residents to choose, by testament, the succession law of their country of nationality to govern the transmission of their patrimony. These two tools deserve to be put in perspective with a Monegasque notary in the framework of a succession planning on measure.
An idea received must be dissipated from the start: buying an apartment in Monaco, even at several tens of millions of euros, does not confer automatically the residence. There is no program of type Golden Visa in the Principality, and each applicant must fulfill precise conditions to obtain Monegasque residence. It is necessary to demonstrate sufficient financial resources to live without professional activity on the territory, or justify an employment with an employer based in the Principality, or still prove a recognized commercial activity locally. The recommendation letter of a local bank constitutes a determining element of the file.
Once administrative residence is obtained, the fiscal residence certificate can be requested approximately one year after your effective installation. It is this document which attests formally of your non-subjection to tax in your country of origin.
It is here that some commit costly errors. A purely formal Monegasque residence, without physical presence real and regular, does not resist a serious control of fiscal authorities of the country of origin. The elements which materialize a recognized principal residence are very concrete: a local bank domiciliation active, a lease contract or property title, proofs of regular presence on the territory and a global coherence between declared residence and real daily life.
Without this rigor, you expose yourself to a fiscal adjustment in your country of origin for fictitious domiciliation, a long and costly procedure. Monaco protects those who play the game of a real installation, not those who seek to simulate appearances.
Fifteen years ago, Monaco still carried the label of opaque fiscal paradise. This time is well finished. The Principality has implemented automatic exchange of fiscal information according to OECD standards, signed transparency agreements with many partner States, and conformed to FATF requirements in matter of anti-money laundering. In practice, banking and patrimonial information of residents can be communicated to foreign fiscal administrations which request it.
The fiscal advantages of the Monegasque regime are legitimate, durable and defensible, and it is because they are inscribed in a transparent and cooperative framework that they persist without questioning.
The force of the Monegasque model, that no comparison table can fully capture, is its stability in time. The absence of income tax, fortune tax, capital gains tax and property tax has not been questioned since 1869. No annual finance law, no political reversal comes to threaten these founding principles.
For an investor or a family concerned to build and transmit a patrimony over several generations, this predictability is worth as much as the figures themselves. Planning in Monaco is planning on a base that time has already widely tested.
It is exact for the vast majority of residents. The Principality does not levy any tax on salaries, dividends, interests or capital gains of persons physically domiciled on its territory. However, there exist two exceptions important: French nationals, who remain taxable in France by virtue of the 1963 Convention, and American citizens, subject to American taxation because of the principle of taxation based on citizenship. For all others, the exemption is total as soon as residence is effective.
Yes, and they are significant. Even if the Franco-Monegasque Convention of 1963 subjects French residents in Monaco to French income tax, other advantages remain accessible. Inheritance rights on goods located in Monaco are 0% in direct line. French residents do not pay neither property tax nor housing tax on their Monegasque goods. It is also possible to acquire via a Monegasque civil company to optimize patrimonial structuring.
No. It is totally possible to rent a dwelling in Monaco and obtain the residence card on this base. The essential is to justify a stable domicile on the territory, whether as tenant or owner. What counts for the authorities, it is the reality of your installation: a lease in good form, a regular presence and a daily life anchored in the Principality are elements just as receivable as a property title.
There is no minimal duration of presence fixed in number of days, contrary to certain countries. What prevails is the reality of the center of life: where you live, where you have your main bank account, where takes place your professional and family life. In practice, the fiscal residence certificate can be obtained approximately one year after your effective installation. It is this document which will allow you to justify to the authorities of your country of origin that your fiscal domicile is now in Monaco.
Yes. Real estate capital gains realized on goods located in France remain taxable in France, independently of your place of residence. The right of taxation follows the localization of the good, not that of the seller. In contrast, capital gains realized on goods located in Monaco are not subject to any taxation for non-French residents, which constitutes one of the major attractions of the Monegasque real estate market on long term.
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