Corporation Tax

• The IGR (General Income Tax) tax rate regularly applied to companies amounts to 17% of the net revenues. However, Law No. 71/2013 (and subsequent Law No. 115/2017) has reduced this tax rate to 8.5% for 5 years of business activity for newly established enterprises whose partners didn’t run a business in San Marino in the previous year and hire an employee within 6 months (who could even be the administrator) and a second employee within 24 months of activity.

  In addition to the 8.5%, a 5% withholding tax must be taken into account, which is applied to revenues distributed directly to natural persons even if, based on the double taxation treaty with Italy, this withholding tax in Italy is deductible from the income statement.

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• 8.5%

  Corporate Income Tax

  5%

  Withholding tax on profits distributed to natural persons

Corporate income tax

The corporate income tax is established by applying the 17% proportional tax rate on the taxable income.

• 8.5%

  Corporate income tax for 5 years of business activity

• For the newly established companies under Law N. 71/2013 and following Law N. 15/2017, the General Income Tax has been reduced to 8.5% for 5 years of business activity. Visit the page about tax incentives.

Withholding tax

• 5%

  Withholding tax on dividends distributed to natural persons

• Profits produced from 01/01/2014 and distributed to natural persons from the corporations are subject to a 5% final withholding tax. The profits distributed to individuals other than natural persons are not subject to any withholding tax as long as the recipient declares to the company which has distributed the profits that he does not act on behalf of a natural person.

Income tax of natural persons

The following chart refers to the income tax rates applied to natural persons and therefore resident in the territory of the Republic and it does not concern those who, whether Italians or foreigners, set up a business in San Marino. We have included these data for those who are considering to apply for a permanent residence or stay permit.