16 Countries With No Income Tax: Discover the Pathway to Tax Freedom

Countries With No Income Taxes: How is That Possible?

Citizens who live in countries that heavily rely on taxing income in order to make ends meet might believe that any other way is either impossible or even illegal. However, the truth is that, sometimes, what we think of as “tax-free countries” are nations that simply have other forms of taxes that do not involve collecting part of the money that companies and individuals make.

Some places have a Value-Added Tax (VAT), which is levied on goods and services, property taxes, importation taxes, and extra taxes on some types of industries, like the taxation on casinos.

Also, many of the countries with no personal income tax rely on other ways to make revenue. Some have important natural resources like oil, while others rely on the profits made by the tourism industry.

And the very fact that residents do not pay tax over their earnings might be the way that the country makes money, by targeting high net-worth individuals that will invest in that location. A win-win situation.

16 Countries With No Income Tax

1. Antigua and Barbuda

Three major islands, two inhabited, one dream: zero tax. Does that math work for you? Add sunny white sanded beaches bathed by turquoise warm waters and you have the Caribbean islands of Antigua and Barbuda.

Tourism accounts for 60% of the nation’s income, giving the country enough support to be able to not tax its citizens and residents on inheritance, personal income, wealth, or capital gains. No wonder this is one of the best countries to get a second citizenship from.

There is another plus: Antigua and Barbuda has a Citizenship by Investment program that allows you to become a citizen with an initial investment of USD $325,000.

2. St. Kitts and Nevis

Still in the Caribbean, still with zero tax on personal income, wealth, gifts, inheritance, and capital gains: welcome to St. Kitts and Nevis. The smallest country in the Americas, both in size and in population, this nation is huge in nature, culture and in a peaceful lifestyle desired by many.

The investment to access your citizenship here may be higher than in many of its Caribbean neighbors, but also more attractive for two reasons. The first is that it offers a real estate option, and it is always a good idea to invest in a tangible asset. The second is that the long lasting and very stable Citizenship by Investment Program in St. Kitts and Nevis is very straightforward and fast, taking from 2 to 4 months to be completed.

3. Monaco

Did you know that the beautiful luxurious Monaco is within the countries that do not have taxes on income? That does not apply for French nationals, but if that is not your case, you can reside there with no need to pay taxes on capital gains, investment income, dividends, directors' fees, wealth, and property purchase. Rentals are taxed at 1% of the annual rent.

If the idea is to avoid taxes while still being in the heart of the European continent, Monaco may still be somewhat expensive, but a good way to go.

4. The Bahamas

A short visit to this beautiful destination or simply a glance at images of the mesmerizing waters bathing The Bahamas will be enough for you to figure out that tourism is one of the main drivers of the country's economy, alongside banking and investment managing.

Residents of the islands must pay VAT, ranging from 0 to 12%, property tax, and stamp tax but do not have to pay any extra tax on income, inheritance, gifts and capital gains.

5. The United Arab Emirates

This futuristic business hub thrived on oil and natural gas exportation but currently has economic diversification as one of its main goals. The UAE is one of the safest and easiest nations of the Gulf Cooperation Council for expats to live in and, in fact, according to Statista, around 89% of the country’s population was made by expats in 2018.

Although newer data from reliable sources is hard to find, there is no indication that this number has decreased since then. On the contrary, the business and personal opportunities offered by the United Arab Emirates keep on growing and attacking more and more people. Among the qualities that many expats often search for is its tax regime, which is zero on personal income, inheritances, gifts, wealth, capital gains, interest and dividends. It does, however, have a 5% Value Added Tax and a corporate tax on net income or profit.

The UAE Golden Visa enables investors to get 10 years of renewable residency permit through the purchase of a real estate property of at least AED 2 million.

6. Vanuatu

This beautiful island in the South Pacific has one of fastest and most straightforward Citizenship by Investment Programs in the world. Recently, the government announced that citizens will soon have to be personally on the island when requesting their passports, in an effort to make the document compliant to standard requirements of the International Civil Aviation Organization, since it will now be collecting biometric and face recognition data, which will strengthen the Vanuatu Passport.

In Vanuatu, residents do not have to pay tax on income, gifts, inheritance, capital gains, or wealth – regardless of having a passport. Companies can also be exempt from taxes for up to 20 years, having to only pay an annual fee of USD $300,00.

7. Cayman Islands

The Cayman Islands have a long-standing reputation of being a tax haven and this is mainly because the government does not impose corporate taxes on companies, attracting many multinational corporations. The Cayman Islands are also an important offshore financial center.

However, it is not only businesses that are benefiting from the islands’ tax regime and laws. Residents are also not burdened with income taxes, property taxes, capital gains taxes and payroll taxes.

8. Qatar

With one of the highest per capita income rates in the world, Qatar is a small but mighty nation. Although it has a solid Muslin tradition, like its neighbors, it is constantly growing its openness, as the country seeks to play a strategic role in the politic scenario and has a big expat community.  

When operating on Qatar’s two Free Zones Authority, international investors can have up to 20 years of corporate tax exemption. Personal income, on the other hand, is never taxed. If you want to take part on the dynamic environment of this tax-free zone, it is possible to do so through the Qatar Golden Visa Program, which allows investors to get residency by purchasing a real estate property of a minimum QAR 728,000.

9. Bahrain

Although Bahrain imposes the heavy corporate tax of 46% on companies from the gas and oil industries, residents do not have to pay tax on income. Other contributions are required such as a 10% VAT and a stamp duty ranging from 1.7 to 2%, among others. Still, this Persian set of Islands is attractive enough for Bahrain to have almost half of its population made by expats.

10. Bermuda

This beautiful North Atlantic island, one of the British Overseas Territories, is an offshore center that also fosters its economy through the gains it makes in tourism. Bermuda is on this list because, as you guessed, it does not levy income tax, corporate tax and capital gains tax. However, Bermuda does have a payroll tax that must be paid by employers that, in turn, can discount up to 9.5% of it from employees’ salary. Also, there is no Residency by Investment programs available to those who want to live in Bermuda, although there is an Economic Investment Certificate that gives you the choice of investing USD $2,5 million in the country’s economy in order to be able to live in Bermuda for five years and then apply for a Residential Certificate. If that sum is out of reach, you will need to get a work permit or marry a resident.

11. British Virgin Islands

Other than tourism, the British Virgin Islands have a prominent livestock business that also helps funding the government, its systems and infrastructure. They have the U.S. Dollar as they currency, which might be just as appealing as its beautiful scenery. the British Virgin Islands is one of the countries without taxation on income and capital gains, but they do not have a Residency by Investment Program so moving there is not a straightforward process.

12. The Maldives

Yes, other than being one of the top dream destinations of vacationers around the globe, The Maldives is one of the countries with zero income tax. Unfortunately, there is no simple way – or virtually no way at all – of becoming a resident in the Maldives if you are not a Sunni Muslim. There are Work Visas, that can only be obtained after getting a Work Permit, and a Business Visa that is not quite a Residency Visa, rather than, as the government states, a “temporary multiple-entry visa”.

13. Brunei

Many of the countries with zero income tax have become, for obvious reasons, big hubs of economic freedom. That is not quite the case of Brunei for some reason. That is not really an issue to the nation as this Asian Pacific makes enough money on oil and gas exportation that it does not need to levy tax on income, export, sales, payroll or manufacturing. Brunei also does not have corporate and property taxes.

14. Kuwait

Another country located on the Golf region, Kuwait is one of the places with no tax on income and also with no VAT. However, it does have a corporate tax and other fees but still, the majority of its revenue comes from the exploitation of resources such as oil and petroleum. Kuwait is also known to be very westernized and expat friendly. The only catch is that moving there through a Residency or Citizenship by Investment Program is not possible.

15. Oman

Also in the Middle East, another tax-free nation is Oman. The government does not levy tax on personal income or on income coming from property, capital gains, wealth or inheritance. At least up until the writing of this article since, recently, the country’s council has moved a draft of a tax reform that would add an income tax to the Sultanate. The fee would be around the 5%, in an effort to keep Oman an attractive long-term destination for expats. In 2021, Oman launched a residency program for investors with real estate and commercial investment options. 

16. Dominica

Last but definitely not least is Dominica, a place where natural beauty and profitable opportunities meet in the best possible way. On the one hand, this beautiful Caribbean Island charges no tax on gifts, on inheritance, on income earned abroad, on capital gains, nor on personal income. Second, and just as important: Dominica has a Citizenship by Investment Program for investment in real estate at a minimum of USD $200,000, and this is just one of the options of the Dominica Golden Visa. This makes Dominica one of the easiest countries to move to, and one with a great view, for that matter.

No-Tax Vs. Low-Tax: Freedom Within Your Reach

Now, here is some valuable advice for you to take into consideration: although living in a zero-tax country seems to be the ideal, moving to a low tax country might be a better option.  

First of all, there are many countries that have no tax on personal income but have other fees. So, moving to a country with no tax on earnings is no guarantee of having zero expenses on that front. Secondly, as you may have noticed, many of the countries with no income tax are also nations with no viable residency programs. Therefore, moving there may not be so easy or beneficial. And this is where the countries with low taxes enter.  

The main difference between a no-tax country and a low-tax country is exactly what the designation each indicates. The first ones do not impose taxes on income and sometimes on other earnings, and the second one might impose some taxes, but they are very moderate.  

Also, a place can be considered low tax when it only charges tax on local income. This can be also called a territorial tax country. On those locations, expats investors with an international source of money may not have to pay tax on what they make. In this case, it is important to check if the country your revenue comes from has a double taxation treaty to the place you are considering moving to, otherwise you might still need to pay taxes on the origin, something that perpetual travelers usually do. 

Interested in discovering countries with less taxes that you are used to - and maybe tired of? We got that covered. 

4 Low-Tax Countries for Expats

Cyprus

Cyprus is a beautiful and well-located island, close to Greece and Türkiye, that is a full part of the European Union and has Euro as its currency. The cost of living is low for European standards and its taxation system is among the most attractive in the continent. Tax obligations on income and property are low, as well as the corporate taxes. Cyprus also do not levy taxes on inheritance.

Moving to Cyprus is also well within reach, through the Cyprus Golden Visa program, officially known as the Cyprus Immigration Permit for Investors. With a minimum investment of USD $300,000 you can start packing your bags towards tax tranquility.

Malta

Malta may not be one of the countries that do not have taxes on income, but it is considered a tax-friendly place, mainly because of some incentives given to companies that can reduce the 35% corporate tax to 5%.

Also, while personal income is taxed progressively up to 35% – which is not low – there is no tax on wealth, on gifts, on inheritance, on interest, on dividends, and also no estate tax, no annual property tax and there is no withholding on dividends. Do not forget that Malta is and EU member state, its currency is Euro, and that the country has double tax agreements with over 70 other nations. So, paying some income tax might still be well worth in exchange for the easiness Malta brings to the table – not to mention the beautiful scenarios and relaxed lifestyle.

All this can be achieved after getting your Permanent Residence in Malta through the purchase of a property starting at €300,000.

Greece

Once again, Greece is not a low-tax country per say, but it can be beneficial for expats who receive a six-figure income and who can qualify for a flat tax regime on foreign-sourced revenue. That way, instead of paying the usual progressive tax on income – that ranges from 22% to 44% - you will pay no more than €100,000 a year. Still quite some money, but an interesting choice for investors who make very high yearly revenues.

Also, Greece is appealing by itself, with some of the most beautiful places in the world, right in the middle of Europe and with a great Residency by Investment Program.

Malaysia

With a mix of tropical paradise and modern city life, Malaysia has options for all. Located in Southeast Asia, this is a good option for high net-worth individuals. Here is how it goes: Malaysia charges regular taxes on everything you make locally but it does not tax any income made elsewhere. However, if you bring the money to the country on a remittance basis, it will be taxed.

If you are able to pay no or low tax on the income source, but do not want to live in that territory for one reason or another, it could be interesting to live in Malaysia and bring just enough money for your monthly needs, minimizing how much you pay in taxes without compromising your quality of life or location needs.

Investment Visa: The Best Way to Find Your Tax Freedom

Paying no tax on income, gifts, inheritance, capital gains, or wealth is great. However, it may not always be a viable option as some zero tax countries do not have many relocation options available, and others may just be too far from your wants and needs when it comes to residency. In this case, moving to a low-tax country might be the ideal middle term to give you enough tax-freedom to live life to the fullest, while also saving as much as possible of your hard-earned income.

The options are many and it can be overwhelming to navigate when you do not have the right assistance. Luckily, you can count on our Investment Visa team of experts to hear all about your desires and necessities and to provide tailored advice on which place will be the best fit for your tax – and life – needs. Best of all, we will also be by your side through the visa application process and will help you go through this journey back-to-back.

Just leave your name, email address and phone number below and let us reach out to you:

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FAQ

Should I Move to a Country with No Income Tax?

Every major move should be considered from different angles. If relocation is already in your plans, moving to a no or low-income tax country can be a great deal for your finances. However, it is important to check if the place you choose has a double tax agreement with the country you either make your money or have another residency on, so you are assured no tax will be paid indeed. Also, do not forget to take into consideration if the lifestyle and opportunities of the country you are moving to match your wants and needs.

Where to Move to Avoid Paying Income Tax?

The list presented above offers many options of countries with no income tax. Just remember to check for double taxation treaties with other countries so you do not end up paying double the amount of taxes.

Do You Need to Move Abroad to Optimize Taxes?

No. There are countries that will allow you to have a residency permit without the need to be physically there for the majority of the year. With that, you can change your tax residence to that country and pay your taxes there, if it has a double taxation agreement to where you have your first residency set on. You can also register a company abroad for tax optimization.

How Much Time do I Have to be in The Country in Order to Become a Tax Resident?

Most countries go by the general 183 yearly rule. That means that after you spend 183 days or more in a country during a calendar year, you can be considered a tax resident for that year.

Are Caribbean Countries the Best Location for No Income Tax?

That will depend on other needs you might have such as lifestyle preferences, business opportunities and location constraints. However, countries such as Antigua and Barbuda, Dominica and St. Kitts and Nevis are really good choices in the Caribbean as they do not have tax on income while also offering excellent Citizenship by Investment programs.

Is the US a Tax-Free Country?

No. The United States of America charge taxes on income, property, imports, payroll, capital gains, gifts, sales, dividends and estates and gifts, charged at federal, state, and local levels.

I Am a US Citizen. How Can I Stop Paying Taxes?

Citizens from the United States of America need to get a second citizenship at a no-tax country and then renounce their US citizenship in order to be exempt from paying tax in their native country.

Are There Countries that Do Not Have Any Taxes?

As there are many different types of taxes, incentives and exemptions, it is hard to pinpoint places that do not charge any type of fee at all. However, there are a good number of countries that do not charge tax on personal income, wealth, gifts, inheritance, capital gains and others. Many of those are listed above.

How Do Tax-Free Countries Make Money?

The majority of countries that do not have taxes on income make their money either with other taxes, like a Value Added Tax (VAT) added to goods and services, or through other ways of collecting money. Many countries in the Golf region, for example, make a revenue by exporting a big part of the great amount of oil and natural gas they have in their territories while most Caribbean Islands have a solid profit coming from the tourism industry.

Do I Need to Pay Taxes While Obtaining a Second Citizenship via Investment?

Yes, depending on the country of your choice. If it is a no-tax country, you need to pay tax on income but there might be some taxes on property and other gains. Our team of experts can advise you on how each country operates.

What Are the Best Tax-free Countries that Have Citizenship by Investment Programs?

The overall combination of tax exemptions and options on Citizenship by Investment Programs puts the Caribbean Islands of Antigua and Barbuda, Dominica and St. Kitts and Nevis at a very good position. Vanuatu and Malta are also to be considered depending on your needs.