While choosing from the top 10 countries with zero income tax to live in, you must consider several factors, such as the availability of a residence visa or citizenship, the country’s general lifestyle, and other taxes imposed by the government. Income tax is one of the top ways a government raises its revenue, but it is not the only option. Some countries rely on oil and other natural resources instead of imposing taxes on their citizens and foreign residents. Some countries also remove income taxes to attract more investors and stimulate economic growth.
Whether you are a wealthy person, an entrepreneur, an investor, or a remote worker, living in a country with no income tax can help you preserve your wealth and reduce your tax burdens. Al Riyady Corporate Services shares its list of the top 10 countries without income tax for you to choose from.
Countries with Zero Income Tax: Is it Possible?
Taxes are one of the top ways for a country to generate revenue, and income tax plays a crucial role in this process. However, if a country is making enough money through other resources, it is possible. Countries like Kuwait, Qatar, and the UAE have no income tax as they are rich in natural resources and earn money from the gas and oil trade. Other countries, such as the Bahamas, rely on tourism and offshore banking, generating significant revenue. Other countries also cancel income tax on foreigners to attract investors to the country.
The list of the top 10 countries without income tax is,
| Middle East | Americas | Europe | Asia | Oceania |
| UAE | Cayman Islands | Monaco | Brunei | Vanuatu |
| Kuwait | Bermuda | Vatican City | North Korea | Wallis & Futuna The Bahamas |
| Saudi Arabia | Saint Barthelemy | |||
| Qatar | Antigua and Barbuda | |||
| Oman | Turks and Caicos | |||
| Bahrain | Anguilla | |||
| St Kitts & Nevis | ||||
| British Virgin Islands |
According to the data from PwC and KPMG, these are the top countries and territories that have no income tax.
In addition to the zero-income tax countries, there are also low-income tax regions, which we will discuss later on in the blog.
Top 10 Countries With Zero Income Tax
Several countries with no income tax are easy to move to and comfortable to live in. You have to spend 6 months a year in the country to become their tax resident and take advantage of low income taxes and more. Here are the top options for you to consider,
St Kitts & Nevis – Top 10 Countries With Zero Income Tax
St Kitts & Nevis has no tax on income, royalties, dividends, or interest for citizens. The VAT rate is 10 to 15%, corporate tax is 33% and property tax is 0 to 0.3%. You can get citizenship by investing $250,000 if you are at least 18 years old, earning legal income, and have a clean criminal record. The citizenship process for St Kitts & Nevis takes about 6 months, and you can also sponsor your Family, including spouse, children, and parents.
The islands are known for their natural beauty, with mountains, beaches, and rainforests. Many travellers visit the island for diving, sunbathing, sailing, and trying the food. Its passport is among the strongest and allows you to travel to 150+ countries without a visa.
Antigua & Barbuda – Top 10 Countries With Zero Income Tax
Not only is Antigua & Barbuda income tax-free, but the citizens also do not have to pay tax on their wealth, inheritance, and capital gains. Suppose your company is registered as an International Business Company (IBC). In that case, you do not have to pay tax for 50 years, including tax on real estate income, corporate tax, securities, and other taxes. The IBCs only pay an annual fee on the authorized share capital.
However, the island does not have many tax treaties, only some with Caribbean countries. It means you have to pay taxes in your country of citizenship when getting citizenship there.
The island is famous for its white and pink beaches, blue lagoon, and coral reefs.
The island offers citizenship if you invest $230,000 or more. The investor must have a legal income, be at least 18 years old, and have no criminal record. You can also include your spouse, financially independent children, parents, and unmarried siblings in your visa application. You can not inherit citizenship automatically; you have to add your Family to the application within five years of obtaining citizenship.
Additional Benefits for Citizenship Holders – Top 10 Countries With Zero Income Tax
Other than tax benefits, the citizenship gives you the following advantages,
- Allows you to enter Schengen countries without a visa and stay for three months.
- Lets you visit the UK without a visa and stay there for about 6 months.
- Travelling to 150+ countries without a visa.
- Getting a 10-year B-1/B-2 USA visitor visa.
The United Arab Emirates – Top 10 Countries With Zero Income Tax
The country has no tax on personal income, inheritance, capital gains, properties, or gifts in the UAE, as it is abundant in oil and natural gas resources.. There is only 9% corporate tax on companies that make a profit of AED 375,000, making it the lowest corporate tax in the world. You can not get UAE citizenship by investment, but you can obtain a renewable residence visa by investing AED 750,000.
There are different types of visas in the UAE for people from various sectors, investment offers for businesses, health and education facilities, government support, and much more. However, the country encourages Islamic practices such as modesty wear for women, especially in beach areas.
Foreigners with residence visas are considered tax residents in the UAE. There is 5% VAT on the purchase and sale of products, and excise tax on products that are harmful to health.
Bahrain
Bahrain is also one of the top countries with zero income tax, 10% VAT, and 46% corporate tax on oil and gas companies. There is a 10% municipality tax for rentals to foreigners, and stamp duty is 1.7 to 2%.
There is no citizenship by investment, but you can obtain a residence by making an investment of $270,000, buying real estate, or being a retiree with sufficient income.
Bahrain is a Muslim country where almost half of the population is foreigners. Getting permanent residence in Bahrain is difficult, and securing permanent citizenship is much harder, as you have to live in the country for 25 consecutive years and be fluent in Arabic.
The Bahamas
The Bahamas is a famous Caribbean island with a corporate tax rate of 3% of the income, a VAT rate of 0-12%, and a property tax rate of 0.75-2%.
Foreigners can get residence permits by investing $ 750,000 or more in the country. The country does not offer citizenship by investment.
The Cayman Islands
There are no income, corporate, or value-added taxes, just a stamp duty of 7.5%. The country does not offer citizenship by investment; however, you can get a residence visa by investing $2.4 million. There is also no company, capital gains, or gift tax, and no prohibition on foreigners owning property. The country has a warm tropical climate, healthcare facilities, and branches of many international companies.
Bermuda
Bermuda is not only income tax-free, but also has no VAT. Corporate tax is based on your share capital, and property tax depends on your estimated annual rental value.
The country does not offer citizenship by investment; however, it is possible to get a resident visa by investing $2.5 million.
You can also live and work there on a work permit issued for one to five years or more.
It is a British territory in the North Atlantic Ocean with a subtropical climate, pink sand beaches, and a rich history.
Monaco
The residents of Monaco and foreign citizens are exempt from income tax (except French). France is exempt because of a 1963 bilateral treaty between Monaco and France.
Monaco has a corporate tax of 33%, 20% VAT, and no real estate tax. You can obtain a residence visa in Monaco by investing € 1 million or more. The country does not offer citizenship by investment for foreigners.
Vanuatu
The country does not impose tax on personal income, capital gains, inheritance, capital exports for individuals, or property. Registered businesses can be exempt from corporate and other taxes for 20 years and only pay a $300 fee annually.
The citizenship program of Vanuatu is one of the fastest, which allows you to obtain your second passport within 2-4 months of investing $ 130,000 or more. The passport will enable you to travel visa-free in 100+ countries and apply for a 5-year multi-entry visit visa in the US. However, if you are visiting Schengen countries, you’ll need a visa.
Vanuatu has not signed tax treaties with other countries, so a Vanuatu passport holder may have to pay taxes in different countries.
Saudi Arabia
There is no personal income tax in Saudi Arabia; however, there is 15% VAT, corporate tax is 20% of the net profit, and 50-85% on corporate income from oil and hydrocarbons.
The country offers permanent residency by investing $1.1 million.
Countries With Low Income Tax Rates
If you are looking for countries with low income tax, consider the following options,
- Bulgaria has a 10% income tax
- Hungary has a 15% income tax
- Georgia has low income taxes and attractive tax benefits.
- If you become a Cyprus tax resident by fulfilling the requirements, you can enjoy low income tax along with other tax incentives.
- Malta has tax rates ranging between 0% and 35%.
- Andorra has a personal income tax rate of 10%.
- Singapore’s personal income tax ranges between 0 and 22%.
- Montenegro offers a low income tax rate of 9%.
How Income Taxes Can Be Useful for a Country?
Income taxes are one of the top sources of revenue for countries worldwide, allowing them to spend on infrastructure, public utilities, and social programs. Increasing the direct income tax has the lowest negative effect compared to corporate and indirect taxes.
Many European countries with high income tax rates offer a high standard of living, public utilities, and strong infrastructure. They utilise their progressive tax funding to improve the health sector, education, and welfare programs, and stabilize their economy.
Key Takeaway
Living in one of the top 10 countries with zero income tax offers you a great opportunity. These countries provide zero income tax, while some of these offer residence visas and citizenship by investment. It is also important to consider the cost of living, potential taxes such as VAT. Make informed decisions that align with your financial and business goals. Whether you are an investor or an entrepreneur, these no-income countries are your gateway to economic stability and a luxurious lifestyle.
Let the expert at Al-Riyady Corporate Services guide you on your business journey. Contact our team and get expert consultancy services, Golden Visa Services, PRO Services Dubai and more.
