Countries with no income tax: 15 places to move to save money

Countries with no income tax: 15 places to move to save money

Saving money is one of the most common reasons for moving abroad, so an up-to-date list of zero-income tax countries or near-zero tax states will be of interest to many.

Income tax is a tax levied on income earned by individuals and businesses. In some high-tax states the income tax exceeds 50%. However, countries whose citizens are completely exempt from this obligation do exist as well. Their governments use alternative sources of income, such as the nationalised oil industry or tourism industry.

It should be noticed that there are no countries with no tax. If income taxes are absent, the government will raise funds through value added tax (VAT), real estate taxes, import duties, stamp duties and license fees.

Individuals seeking to preserve their capital are interested in countries with no income tax where they may get citizenship or residency by investment. Most of these countries require a stay of 183 days or more per year to maintain tax residency status and take full advantage of the local tax system. At the same time, they offer a high quality of life and a comfortable environment for work, business and leisure.

Are there any countries with no income tax?

There are several countries whose citizens and residents are completely exempt from income tax. Best tax free countries attract investors and entrepreneurs seeking to diversify their assets and optimise their tax burden.

15 countries without income tax

Ekaterina Nekrasova
Expert
Citizenship-By.Investment
There are 3 ways for individuals and legal entities to avoid income tax. The first one is moving from place to place constantly. A person cannot be a tax resident unless he/she stays in one country for a long period of time. However, this is too tedious. The second way is to earn income in one state and reside in another tax-free state. The third is to reside in a country with zero taxation. The last two options are the most optimal, especially now when many states provide the programme of issuing investment residence permit/permanent residence permit/citizenship.

Tax-free countries include:

  1. Antigua and Barbuda.
  2. Kitts and Nevis.
  3. Bahrain.
  4. The UAE.
  5. The Bahamas.
  6. The Cayman Islands.
  7. Bermuda.
  8. Vanuatu.
  9. Monaco.
  10. Saudi Arabia.
  11. The Virgin Islands.
  12. Turks and Caicos.
  13. Brunei.
  14. Kuwait.
  15. Qatar.

The lowest tax countries in the world

In addition to nations that have no income tax at all, there are the lowest taxed countries. They either offer very low income tax rates (below 10%) or only tax local profits. Such countries include:

  1. It was the first Gulf country to introduce an income tax. Under a law approved in July 2024, Omani citizens will be taxed at 5% on global income over $1 million. Expats will pay tax on incomes over $100,000 with a progressive rate of 5–9%.
  2. The island nation's income tax ranges from 0 to 35%. Foreign income not transferred to local accounts is not taxed, while transferred income is taxed at a rate of 15%. Income earned within the country is taxed up to 35%.
  3. The rate also varies from 0 to 35%. There is no tax on foreign income and inheritance; the corporate tax rate is only 12.5%, which is lower than in most European countries.
  4. The income tax rate for individuals and legal entities is 9%. Tax residents do not pay interest tax and luxury tax. The annual property tax rate varies between 0.25-1% depending on the market value of the property.
  5. Income tax for individuals and legal entities is 10%. VAT in the Principality is 4.5%, the lowest in Europe.
  6. Income tax rate for individuals varies from 0 to 22%, and corporate tax is 17%.

Is it possible to optimise taxes without moving abroad?

To minimise the tax burden, foreigners can establish residency or open a company in a low-tax state. One of the available options is permanent residence in Cyprus. To maintain tax residency status, you must stay in the Republic for at least 60 days per year.

Affordable properties to buy in Cyprus

The citizenship and residence permit by investment programme is also available in Malta, Montenegro, Andorra and Singapore. A participant interested in tax optimisation should make sure that his/her main country of residence has a double tax treaty with the state in which he/she plans to become a resident.

Overview of zero income tax countries

Antigua and Barbuda

In addition to income tax, the island nation has no estate, wealth, capital gains, or inheritance taxes. International business companies incorporated in the country also do not have to pay corporate tax on income from property, securities and other financial assets for 50 years. Instead, they pay an annual levy, the rate of which depends on the amount of capital.

However, it should be noted that Antigua and Barbuda does not have many double tax treaties. They are mostly concluded with other Caribbean states. Therefore, most residents will still have to pay taxes in the country of first citizenship.

The minimum investment threshold for obtaining a passport is $230,000.

St Kitts and Nevis

It is the country with no taxes on income, dividends, luxury and interest for residents. Corporate tax is 25% (it was reduced in January 2024 from 33% previously). It is a low VAT country ranging from 10 to 15%. The property tax rate is between 0.2 and 0.3%.

The minimum investment threshold for citizenship is $250,000.

Bahrain

Residents of the kingdom are exempt from income tax, and a corporate tax of 46% is levied only on companies operating in the gas and oil sector. VAT and council tax on rent for expats in the country is 10%, and stamp duty on the transfer or registration of property varies between 1.7-2% of its value.

The minimum investment threshold for a residence permit is $132,500.

The UAE

The state belongs to the group of countries with no taxes on personal income, capital gains, inheritance, gift, and estate. A corporate tax of 9% applies only to businesses with profits exceeding $102,000.

The minimum investment threshold for obtaining a residence permit is $204,000.

Affordable properties to buy in UAE

The Bahamas

Residents are exempt from income tax. A corporate tax of 15% is levied only on large multinational companies whose annual profits exceed €750 million, according to the OECD's Pillar Two rules. Ordinary businesses pay a licence fee, the rate of which can be as high as 3% of turnover. VAT ranges from 0 to 12% and real estate tax from 0.75 to 2%.

The minimum investment threshold for obtaining a residence permit is $750,000.

The Cayman Islands

The islands have no income or corporation tax and no VAT. The amount of stamp duty on property transactions is 7.5%.

The minimum investment threshold for a residence permit is $2.4 million.

Bermuda

Bermuda is one of the countries without VAT. Corporate tax is calculated based on share capital, except for large multinational companies with annual revenues over €750 million, for which it will be 15% from 2025. Property tax is calculated based on the assessed value of the annual rental.

The minimum investment threshold for obtaining a residence permit is $2.5 million.

Vanuatu

Individuals in the republic are exempt from taxes on personal income, inheritance, capital gains, and exports. Companies paying an annual fee of $300 can also be exempt from corporate and other types of taxes for 20 years.

However, the Vanuatu government has not entered into a double taxation agreement with many nations around the world. Therefore, most expats who have obtained local passports must pay taxes in the other country.

The minimum investment threshold for citizenship is $130,000.

Monaco

Residents of the microstate are exempt from income tax and property tax. Corporate tax is 25% and VAT is 20%.

The minimum investment threshold for residence permit is €1 million.

Saudi Arabia

The kingdom has no personal income tax. The corporate tax rate is 20% of net profits, but income from oil and hydrocarbon production is taxed at a rate of 50-85%. The standard VAT rate is 15%.

The minimum investment threshold for a residence permit is $26,500.

The Virgin Islands

The overseas British territory does not levy taxes on income and capital gains. They do not currently have an active programme to grant citizenship or residence permits by investment.

Turks and Caicos

Another British overseas territory in the Atlantic Ocean has no taxes on income, capital gains, property, inheritance or corporate profits. Residence or citizenship cannot be obtained in exchange for investment.

Brunei

There is no personal income or value added taxes in the sultanate. Corporate tax is 18.5% for most companies. However, for companies involved in oil and gas extraction, the rate is 55%.

There is no current programme for granting residence permits or citizenship by investment.

Kuwait

Citizens of the emirate do not pay taxes on personal income, value added and property. The corporate tax rate is 15%.

The state does not currently grant residence permits or citizenship to investors.

Qatar

The Middle Eastern state has no personal income, value added, and property taxes. However, when renting out property, a fee must be paid to register the contract. The corporate tax rate is 10% for most companies. However, for companies in the oil and gas sector, the rate can be as high as 35%.

Residence permit or citizenship cannot be obtained through investments.

To move to a country with an attractive tax system, contact the experts at Citizenship-By.Investments. We can help you search for the right place to move to, apply for a residence permit/permanent residence permit/citizenship programme, and find accommodation.

FAQ

How do countries make money without taxes?
There are no completely tax-free countries in the world. Low-tax states get their money from other sources, such as the tourism industry. This is how the Bahamas and Maldives make money. Saudi Arabia, UAE and Qatar fund their governments and public services through the oil and gas industry. Many states also use other types of taxes such as VAT and property tax.
Where should I move to avoid paying income tax?
You can move to the UAE, Monaco, Vanuatu or any other country on our comprehensive list of other tax-free countries that grant residence permits or citizenship to optimise your taxes. Your lifestyle and reason for moving should be the deciding factors. Some countries offer ideal conditions for entrepreneurs, others for travellers. Consult our experts to make the right choice.
Is it possible to optimise taxes without moving abroad?
In some cases, a foreigner can choose no income tax regions for business and life and become a tax resident by staying in the state for a short period of time, in others they move the business abroad and reduce tax without staying in the country.
Do I have to pay taxes when obtaining a second citizenship by investment?
Yes, even after obtaining a second citizenship, it is necessary to pay taxes in the country of the first citizenship. However, if there is a double tax treaty between the two countries, it is allowed to pay taxes in one of them or both but at reduced rates.
What countries don't have taxes?
Places with no taxes include Antigua and Barbuda, St Kitts and Nevis, Bahrain, the UAE, the Bahamas, the Cayman Islands, Bermuda, Vanuatu, Monaco, Saudi Arabia, the Virgin Islands, Turks and Caicos, Brunei, Kuwait, and Qatar.
Which country has the highest taxes?
Côte d'Ivoire (60%), Finland (56.95%) and Denmark (55.9%) have the highest income tax rates.
Which Caribbean country has no income tax?
St Kitts and Nevis offers a favourable tax system for residents. It is a country without income tax, luxury or dividend taxes. Residents of Antigua and Barbuda are also exempt from income, wealth, capital gains and inheritance taxes.
Which European countries are tax-free?
There are no European countries with zero taxation. However, residents of Monaco are exempt from income tax.
Is the UAE tax-free?
The UAE has no income tax, but legal entities are subject to a 9% corporate tax if their income exceeds $102,000. This is still one of the lowest rates in the world. It belongs to the list of countries with no capital gain taxes, inheritance, gift, or estate taxes.
Is the US tax-free?
No, income tax in the US can be as high as 37%. But it is absent in some states such as Alaska, Florida and Nevada.
Is Germany tax-free?
No, Germany has one of the highest income tax rates in Europe. It depends on an individual's income and can be as high as 45%. The corporate tax in the country is 15%.
Is Switzerland tax-free?
No, the confederation has taxes on personal and corporate income, real estate, value added, and even dog ownership. The local taxation system is divided into three levels: federal, cantonal and municipal. At the federal level, citizens are not subject to gift tax.
Is Sweden tax-free?
No, the local income tax rate depends on the municipality and varies between 28.9835.15%. Corporate tax is 20.6% and standard value added tax is 25% (or 12% and 6% at reduced rates).
Is Luxembourg a tax haven?
The Duchy offers tax incentives for legal entities. For example, private asset management companies are exempt from corporate tax, municipal business tax, and wealth and value-added taxes. There are also no luxury taxes. However, corporate taxes do exist and capital gains tax applies under certain conditions.
Comments
Zinaida Tokareva
24.08.2024
I am interested in proximity to the U.S. and registration of residency for the purchase of real estate, so I have chosen the Bahamas. Do you provide property search services abroad?
Stanislav
23.08.2024
I have never ever regretted moving to Vanuatu. I obtained citizenship in just 3 months, and the amount for participation in the programme is very low. Inexpensive housing near the beach and visa-free regime with Hong Kong were fundamental factors for me.
Vasilisa
19.08.2024
Can you tell me, please, with which countries Russia has a double taxation avoidance agreement? How can I get to you for a consultation?
Danil Akimenko
16.08.2024
Thanks for the information! Now I understand why all my old acquaintances who have their own businesses have migrated to the Emirates. I have been thinking about moving for a long time; the conditions of their programme are quite attractive.
Yuri S.
08.08.2024
The UAE is a paradise for entrepreneurs and investors. I have been living in Dubai for several years now, and I have a small business. I pay corporate tax, as the company's profit is high, but I still get more profit than I could in my home country.