Monaco: becoming resident

« Becoming Monaco resident, for tax purposes, is a relatively simple and straightforward procedure. However, becoming resident, in terms of lifestyle, requires careful planning for both the short term resident and for those who intend to make Monaco their final home»

Tim Thornton Jones

TAX IN MONACO

There is no Income Tax, Capital Gains Tax or Wealth Tax in Monaco.
Estate/Gift Duties do exist in Monaco, but in limited circumstances and only in respect of Monaco-sited assets. Where such assets pass to the immediate family (spouse, children, grandchildren) there is no tax.
Monaco has recently announced changes to its succession laws, allowing a Monaco resident testator to select the law of a state of which he/she had nationality at the date of making the Will as applying to his or her estate, including Monaco-sited assets.

 

HOW TO BECOME A RESIDENT OF MONACO

If you intend to spend more than 3 months of the year, or intend to settle, in Monaco, then you need to apply for a Residency Card. This is granted by Monaco’s Immigration Police after an application file has been submitted for review. EU citizens, and citizens of a limited number of other countries including Switzerland, make their application directly to Monaco, whereas citizens of other countries need to obtain a visa from the French Consulate of their country before then applying to Monaco.
Apart from having a clean Police record, it is necessary to prove possession of a sufficient means to live in Monaco without needing to work, or a job or business activity which will provide those means. Any applicant who is self-sufficient must open a bank account in Monaco and deposit at least €500,000 in order to obtain a Bank certificate of means/good standing. It is also necessary to have a place to live in Monaco before making the residency application. It is possible to rent or buy. If renting, the lease must be for a minimum of 12 months and have sufficient bedrooms to accommodate the number of persons applying, eg a couple should rent a minimum of a one bedroom apartment, a family of four a minimum of two bedrooms.

There are three levels of residency in Monaco:

1. ‘Carte de sejour temporaire’ which lasts for one year before it has to be renewed (as well as providing evidence of residence within the Principality for a minimum of 3 months of that year, eg by production of utility bills, credit card statements etc).
2. After two renewals of the first level residency carte, application can be made for a ‘Carte de sejour ordinaire’, which lasts for three years and is renewable once.
3. A ‘Carte de sejour privilegie’ is the highest level of residency and requires that you make Monaco your main residence.

 

SETTING UP A BUSINESS IN MONACO

A business licence, granted by the Monaco Government, is required in order to carry out any commercial, industrial or professional business in Monaco. ‘Business’ includes a sole trader, unlimited liability Monaco partnership, limited liability Monaco partnership, limited liability Monaco company, or branch of a foreign company. If the business is in the financial services arena, eg a Hedge Fund, or Asset Management, the business will also be regulated by Monaco’s Financial Services Regulator (CCAF).
Single Family Offices are not normally regulated, although Multi-Family Offices, managing the assets of several families, are regulated.

EMPLOYMENT

A work permit is required for any non-Monegasque employee, which requires a medical being carried out before it will be granted. Employees benefit from Monaco’s Social Security system under which they receive medical, unemployment and pension cover.

About the author:

  

Tim Thornton Jones is a partner at Irwin Mitchell Private Wealth. He has built a significant practice advising the ex-pat community in Monaco.

 

Contact Tim:

Tim.ThorntonJones@IrwinMitchell.com

Irwin Mitchell Private Wealth profile:

Irwin Mitchell Private Wealth

Share Post :

More Insight