Lifestyle
Top 10 countries with zero income tax rate
Governments are saddled with the responsibility of providing relevant infrastructure for residents’ comfort and ease of doing business.
One way most nations’ governments are able to generate funds for such projects is through tax. For many working class, tax payment is a dilemma they prefer to avoid. Residents of Finland for instance pay tax as high as 66.75%, Portugal 64%, and the United Kingdom 63.25%. Nigeria’s personal income tax is as high as 24 per cent depending on your total income.
In case you are considering relocating and in search of countries where you do not have to pay tax, here are the top 10 countries with zero personal income tax:
1. Cayman Islands – 0%
The Cayman Islands is a British Overseas Territory located in the western Caribbean Sea. It is a group of three islands: Grand Cayman, Cayman Brac, and Little Cayman.
It is the largest and most populated island, known for its Seven Mile Beach, a world-famous stretch of white sand and crystal-clear water.
The Cayman Islands are a popular tourist destination, known for their beautiful beaches, scuba diving, and snorkeling. The islands are also a major financial center, with many offshore banks and hedge funds.
The population of the Cayman Islands as of May 2024 is about 69,809.
The Cayman Islands are famous for their tax-neutral (zero-tax) status. This means they don’t have any of the following direct taxes:
- Income tax
- Capital gains tax
- Property tax
- Payroll tax
- Withholding tax
This makes them attractive to businesses and wealthy individuals looking to minimize their tax burden. The government raises funds through other means like:
- Fees on tourism (both stay-over and cruise ships)
- Work permit fees
- Import duties
- Fees on financial transactions
The zero-tax status has made the islands a major financial center, with many offshore banks and hedge funds.
2. Bahamas – 0%
The Bahamas is an archipelago, meaning it consists of many islands and cays. It is an island country located in the North Atlantic Ocean, north of Cuba and northwest of Hispaniola (split between the Dominican Republic and Haiti) and the Turks and Caicos Islands. It is a popular tourist destination, known for its beautiful beaches, clear waters, and relaxed atmosphere.
There are more than 3,000 islands, cays, and islets in the Bahamas. The largest island is Andros Island, and the capital city is Nassau, located on the island of New Providence.
The population of Bahamas as of May 2024 is about 414,881.
The Bahamas is a constitutional monarchy with a parliamentary democracy. The King of England is the head of state, but the Bahamas is self-governing. The Prime Minister is the head of government.
The island country is known as a tax haven because it doesn’t have some of the common taxes found in other countries.
- No income tax: There’s no personal income tax, corporate income tax, or capital gains tax in the Bahamas.
- Social Security: A social security tax is levied, but it has a maximum contribution amount. Employees pay 3.9%, employers contribute 5.9%, and self-employed individuals pay 9.8%.
- Consumption Tax: The Bahamas uses a Value Added Tax (VAT) system. VAT is a broad-based consumption tax applied to most goods and services bought, sold, or imported in the Bahamas. There’s a standard VAT rate of 10% and a zero rate for some goods.
For businesses, there are:
Business License: Businesses need a license to operate, with fees based on a flat rate or a percentage of their revenue.
Other taxes: There are some other taxes such as stamp duty on real estate transactions.
3. Bahrain – 0%
Bahrain, officially the Kingdom of Bahrain, is an island country in Western Asia. It is situated on the Persian Gulf, and comprises a small archipelago made up of 50 natural islands and an additional 33 artificial islands, centered on Bahrain Island which makes up around 83 percent of the country’s landmass.
Bahrain is situated between Qatar and the northeastern coast of Saudi Arabia, to which it is connected by the King Fahd Causeway.
The population of Bahrain as of May 2024 is about 1,496,997.
Bahrain generally doesn’t have income taxes for individuals or corporations. This applies to income derived from things like salaries, capital gains, and even repatriated profits.
- The one exception is for companies involved in the oil and gas sector, specifically those dealing with exploration, production, or refining of hydrocarbons. These companies are subject to a corporate income tax of 46% on their net profits.
4. Bermuda – 0%
Bermuda is a British overseas territory located in the North Atlantic Ocean, east of the United States mainland. It is known for its beautiful beaches, pink sand shores, and crystal-clear waters.
Bermuda traditionally has been a tax haven, with no income taxes for residents or businesses. This applies to income derived from things like salaries, capital gains, and even profits earned overseas by Bermuda-registered companies.
Meanwhile, there have been some recent changes. in December 2023, Bermuda passed legislation to implement a corporate income tax (CIT) of 15%.
However, this tax will only apply to large multinational enterprises (MNEs) with a global annual group revenue of €750 million or more.
The CIT will be effective for tax years starting on or after January 1, 2025.
The population of Bermuda as of May 2024 is about 64,000.
5. Brunei – 0%
Brunei, officially known as Brunei Darussalam, is a country located on the north coast of Borneo island in Southeast Asia. It’s known for its rainforests, Islamic architecture, and rich oil and gas reserves.
It has one of the simplest tax systems in the world, particularly for individuals. The nation has no personal income tax on residents or non-residents. This means you don’t pay taxes on your salary, wages, or other forms of income earned within the country.
Companies registered in Brunei are subject to a corporate income tax, but the rate is relatively low compared to many other countries. The current rate is 22%.
However, there’s an exception income derived from petroleum operations is taxed under a separate law, the Income Tax (Petroleum) Act, with a fixed rate of 55%.
The population of Brunei as of May 2024 is about 455,409.
6. Kuwait – 0%
7. Oman – 0%
8. Qatar – 0%
9. Saudi Arabia – 0%
10. UAE – 0%
Disclaimer
The information in this article was curated from online sources. NewsWireNGR or its editorial team cannot independently verify all details.
Follow us on Instagram and Facebook for Live and Entertaining Updates.
Always visit NewsWireNGR for the latest Naija news and updated Naija breaking news.
NewsWireNGRLatest News in Nigeria
Send Us A Press Statement/News Tips on 9ja Happenings: [email protected].
Advertise With Us: [email protected]