INHERITANCE, GIFT AND WEALTH TAXES IN MONACO

Wealth taxation in Monaco: an attractive and advantageous framework

Monaco is distinguished by a particularly favourable tax system for individuals, particularly in terms of assets, inheritance and gifts. The Principality offers a stable and predictable tax environment that is appreciated by wealthy families and international investors.

1. No wealth tax

The Principality of Monaco does not levy any wealth tax, property tax, or housing tax. However, French nationals residing in Monaco are subject to the Real Estate Wealth Tax (IFI) in France, in accordance with the Franco-Monegasque tax treaty of 1963. They must declare their real estate located in France and abroad, according to French tax rules.

2. Taxation of gifts in Monaco

Gift tax in Monaco applies only to property located on Monegasque territory, regardless of the donor's domicile, residence, or nationality. The rates vary according to the relationship between the donor and the beneficiary: 

• Between parents and children or between spouses : 0%
• Between partners bound by a civil union contract : 4%
• Siblings: 8%
• Between uncles, aunts, nephews and nieces : 10%
• Among other parents: 13%
• Between non-relatives: 16 %

These rates apply to gifts formalized in writing or by notarial deed.

3. Inheritance taxation in Monaco

Inheritance tax in Monaco applies only to property located in the Principality, regardless of the domicile, residence, or nationality of the deceased. The tax rates are identical to those for gifts and depend on the family relationship between the deceased and the heir:

• Between parents and children or between spouses : 0%
• Between partners bound by a civil union contract : 4%
• Siblings : 8%
• Between uncles, aunts, nephews and nieces : 10%
• Among other parents : 13%
• Between non-relatives : 16%

It is important to note that these taxes apply only to property located in Monaco.

4. Franco-Monegasque Tax Convention of 1 April 1950

This agreement concerns the application of inheritance tax between a French deceased and his or her heirs. It stipulates that real estate located in France is subject to French inheritance tax, even if the deceased resided in Monaco. Conversely, property located in Monaco is subject to Monegasque taxation, thus offering significant advantages for transfers between close relatives.

5. Estate planning in Monaco

Monegasque Law No. 1.448 of 28 June 2017 allows Monaco residents to choose the inheritance law of their country of nationality to govern the transfer of their assets through a will. This flexibility provides international residents the ability to tailor their estate planning to suit their specific needs.

Conclusion

Monaco offers a particularly advantageous tax framework for the management and transmission of wealth. The absence of wealth tax, reduced inheritance and gift taxes, as well as the possibility of choosing the law applicable to one's inheritance, make the Principality a privileged destination for families and investors wishing to optimise their financial situation.

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