macau personal Income tax
Macau (also spelled 'Macao') indivial income tax is levied at progressive rates from 7% to 12% on annual taxable income exceeding MOP 120,000.
An individual employed to work for a Macau entity but who does not possess a valid identity card or work permit issued by the Macao government will be taxed at a rate of 5% or computed in accordance with the progressive rate method, whichever is higher.
Basis – Individuals are subject to professional tax (equivalent to personal income tax) if they have an employment relationship with a Macao entity.
Residence – An individual is considered resident if he/she holds an identity card issued by the Macao government. Individuals temporarily present in Macao on work permits also are subject to professional tax.
Tax Filing status – Professional tax is charged on an individual basis.
Taxable income – All monetary and nonmonetary benefits granted to employees are taxable.
Capital gains – No
Tax Deductions and tax allowances – Limited personal allowances are available.
Other taxes on individuals:
Capital duty – No
Stamp duty – See under "Other taxes on corporations," below.
Capital acquisitions tax – No
Real property tax – Property tax is levied either at 10% of the rental value assessed by the government or 16% on the actual rental income generated. An additional 5% stamp duty is levied on the tax payment, making the effective tax rates 10.5% or 16.8%. Exemptions are granted for newly constructed, with the exemption period varying by the location.
Inheritance/estate tax – No
Net wealth/net worth tax – No
Social security contributions – Resident employees must contribute MOP 15 per month to FSS. Work permit holders do not contribute to FSS (instead, employers must contribute MOP 45 per month per work permit holder).
Administration and compliance:
Tax year – Calendar year in Macao is the calendar year.
Filing and payment – Employers withhold professional tax on employment income on a monthly basis and remit it to the government on a monthly or quarterly basis, depending on whether the employees are residents or work permit holders. Employers also must file an annual tax return for employees.
Tax Penalties – Penalties and interest apply for failure to comply.
Basis – Individuals are subject to professional tax (equivalent to personal income tax) if they have an employment relationship with a Macao entity.
Residence – An individual is considered resident if he/she holds an identity card issued by the Macao government. Individuals temporarily present in Macao on work permits also are subject to professional tax.
Tax Filing status – Professional tax is charged on an individual basis.
Taxable income – All monetary and nonmonetary benefits granted to employees are taxable.
Capital gains – No
Tax Deductions and tax allowances – Limited personal allowances are available.
Other taxes on individuals:
Capital duty – No
Stamp duty – See under "Other taxes on corporations," below.
Capital acquisitions tax – No
Real property tax – Property tax is levied either at 10% of the rental value assessed by the government or 16% on the actual rental income generated. An additional 5% stamp duty is levied on the tax payment, making the effective tax rates 10.5% or 16.8%. Exemptions are granted for newly constructed, with the exemption period varying by the location.
Inheritance/estate tax – No
Net wealth/net worth tax – No
Social security contributions – Resident employees must contribute MOP 15 per month to FSS. Work permit holders do not contribute to FSS (instead, employers must contribute MOP 45 per month per work permit holder).
Administration and compliance:
Tax year – Calendar year in Macao is the calendar year.
Filing and payment – Employers withhold professional tax on employment income on a monthly basis and remit it to the government on a monthly or quarterly basis, depending on whether the employees are residents or work permit holders. Employers also must file an annual tax return for employees.
Tax Penalties – Penalties and interest apply for failure to comply.
macau Corporate tax
Macau corporate tax is levied at progressive rates ranging from 9% to 12%.
Residence – An entity is resident if it is incorporated in Macao.
Basis – Residents are taxed on worldwide income; nonresidents are taxed only on Macau source income. Foreign-source income derived by residents is subject to complementary tax (equivalent to corporate tax) in the same way as Macao-source income. Branches are taxed the same as subsidiaries.
Taxable income – Complementary tax is imposed on a company's profits, which consist of business income, interest income and realised capital gains. Normal business expenses may be deducted in computing taxable income.
Taxation of dividends – Dividends received by a Macau company from another Macao company are exempt from complementary tax if the dividends are paid out of after-tax profits. Dividends received from a foreign company are subject to complementary tax in the period the dividends are received.
Capital gains – Capital gains are subject to complementary tax on realisation.
Losses – Group A taxpayers (see under "Filing requirements") may carry forward losses for 3 years. Group B taxpayers may not carry forward losses. The carryback of losses is not permitted.
Surtax – No
Alternative minimum tax – No
Foreign tax credit – No
Participation exemption – No
Holding company regime – No
Tax Incentives – No, except for investments in certain circumstances (environment, technology, diversification).
Withholding tax:
Dividends – No
Interest – No
Royalties – No
Branch remittance tax – No
Other taxes on corporations:
Capital duty – No
Payroll tax – No
Real property tax – Property tax is levied either at 10% of the rental value assessed by the government or 16% on the actual rental income generated. An additional 5% stamp duty is levied on the tax payment, making the effective tax rates 10.5% or 16.8%.
Exemptions are granted for newly constructed property, with the exemption period varying by the location.
Social security contributions – Employers and employees must contribute to the social security contribution fund (FSS). Employers must contribute MOP 30 per month per Macao resident employee and MOP 45 per month for employees who are work permit holders.
Stamp duty – Stamp duty is imposed on most transactions at rates ranging from 0.2% to 5% depending on the transaction.
Transfer tax – No
Anti-avoidance rules:
Transfer pricing – No
Thin capitalisation – No
Controlled foreign companies – No
Other – No
Disclosure requirements – No
Administration and compliance:
Tax year – Macao tax year is the calendar year
Consolidated tax returns – Consolidated returns are not permitted; each legal entity is required to file a separate return.
Tax Filing requirements – Taxpayers in Macao are categorized as Group A and Group B taxpayers. To qualify as a Group A taxpayer, a company must apply to be so classified or meet the minimum requirements either in terms of share capital or annual taxable income generated during the past 3 years.
Public companies, companies with capital exceeding MOP 1 million or with average annual profits exceeding MOP 500,000 for the last 3 years qualify to file under Group A.
Group A taxpayers must submit their annual complementary tax returns in respect of the preceding year between April and June. Tax returns should be certified by a registered accountant or auditor in Macao.
Group B taxpayers must file their returns before the end of March and certification is not compulsory. Provisional payment of complementary tax is due in 1 or 2 instalments in September or November of the following tax year, based on taxable income declared in the tax return. Final tax liability is due upon final assessment. Employers also are required to file returns related to wages paid.
Tax Penalties – Penalties and interest apply for failure to comply.
Residence – An entity is resident if it is incorporated in Macao.
Basis – Residents are taxed on worldwide income; nonresidents are taxed only on Macau source income. Foreign-source income derived by residents is subject to complementary tax (equivalent to corporate tax) in the same way as Macao-source income. Branches are taxed the same as subsidiaries.
Taxable income – Complementary tax is imposed on a company's profits, which consist of business income, interest income and realised capital gains. Normal business expenses may be deducted in computing taxable income.
Taxation of dividends – Dividends received by a Macau company from another Macao company are exempt from complementary tax if the dividends are paid out of after-tax profits. Dividends received from a foreign company are subject to complementary tax in the period the dividends are received.
Capital gains – Capital gains are subject to complementary tax on realisation.
Losses – Group A taxpayers (see under "Filing requirements") may carry forward losses for 3 years. Group B taxpayers may not carry forward losses. The carryback of losses is not permitted.
Surtax – No
Alternative minimum tax – No
Foreign tax credit – No
Participation exemption – No
Holding company regime – No
Tax Incentives – No, except for investments in certain circumstances (environment, technology, diversification).
Withholding tax:
Dividends – No
Interest – No
Royalties – No
Branch remittance tax – No
Other taxes on corporations:
Capital duty – No
Payroll tax – No
Real property tax – Property tax is levied either at 10% of the rental value assessed by the government or 16% on the actual rental income generated. An additional 5% stamp duty is levied on the tax payment, making the effective tax rates 10.5% or 16.8%.
Exemptions are granted for newly constructed property, with the exemption period varying by the location.
Social security contributions – Employers and employees must contribute to the social security contribution fund (FSS). Employers must contribute MOP 30 per month per Macao resident employee and MOP 45 per month for employees who are work permit holders.
Stamp duty – Stamp duty is imposed on most transactions at rates ranging from 0.2% to 5% depending on the transaction.
Transfer tax – No
Anti-avoidance rules:
Transfer pricing – No
Thin capitalisation – No
Controlled foreign companies – No
Other – No
Disclosure requirements – No
Administration and compliance:
Tax year – Macao tax year is the calendar year
Consolidated tax returns – Consolidated returns are not permitted; each legal entity is required to file a separate return.
Tax Filing requirements – Taxpayers in Macao are categorized as Group A and Group B taxpayers. To qualify as a Group A taxpayer, a company must apply to be so classified or meet the minimum requirements either in terms of share capital or annual taxable income generated during the past 3 years.
Public companies, companies with capital exceeding MOP 1 million or with average annual profits exceeding MOP 500,000 for the last 3 years qualify to file under Group A.
Group A taxpayers must submit their annual complementary tax returns in respect of the preceding year between April and June. Tax returns should be certified by a registered accountant or auditor in Macao.
Group B taxpayers must file their returns before the end of March and certification is not compulsory. Provisional payment of complementary tax is due in 1 or 2 instalments in September or November of the following tax year, based on taxable income declared in the tax return. Final tax liability is due upon final assessment. Employers also are required to file returns related to wages paid.
Tax Penalties – Penalties and interest apply for failure to comply.
macau vat (Value Added Tax)
There is no VAT or sales tax in Macau.
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