Vanuatu Taxes for Individuals and Companies – What You Need to Know

Vanuatu is a strategic jurisdiction for tax purposes. The country does not impose income tax, capital gains tax, inheritance tax, or wealth tax. The framework of Vanuatu taxes allows most individuals to optimize their finances legally, and legal entities can generally benefit from the country’s business-friendly tax system.

Gain full insight into Vanuatu taxes for individual tax residents and international companies, including tax rates, the tax system, and exemptions.

Tax in Vanuatu: Key Facts

Vanuatu has no personal or corporate income tax, but individuals and businesses are subject to taxation on rental income.

VAT is charged at 15% on most goods and services.

Rental income is taxed at 12.5%, with individuals benefiting from a VT 200,000 (about $1,692) six-month exemption threshold, depending on their earnings.

Employees contribute 6% of gross into the Vanuatu National Provident Fund (VNPF), with employers contributing another 6%.

Vanuatu tax residency is generally determined by spending more than 183 days in the country.

1. Zero income taxes: Vanuatu has a long-standing reputation for tax-friendliness, allowing individuals to remain tax-efficient through minimal taxation. There are no direct taxes on individuals whose income does not come from rent, although there may be other obligations.
2. Favorable for businesses: Vanuatu’s corporate tax rate is set to 0%, allowing tax-compliant corporations operating out of the country to retain more of their profits by paying an annual fee.
3. Low indirect taxes: Though the income tax rate in Vanuatu is 0%, tax residents must pay indirect taxes, such as Value Added Tax (VAT) and taxes on property transactions. However, indirect tax rates are generally low.
4. Wealth preservation: Capital export tax, capital gains tax, inheritance tax, personal income tax, annual property tax, and wealth tax are not charged in Vanuatu. Vanuatu is safe to establish tax residency for tax purposes.

Vanuatu’s zero-income taxation policy for most individual residents and non-residents generally means there is no requirement to pay income tax. Individuals generally gain Vanuatu tax residency after spending more than 183 days in the country, and the requirement to submit annual tax returns to the Vanuatu Customs and Inland Revenue Department (CIRD), along with other filings, depends on their income and activities.

Under the Rent Taxation Act (Cap. 196), individuals who earn under VT 4 million in rental income pay a 12.5% rental income tax, with the first VT 200,000 (about $1,692) of rental income earned in a six-month period exempt from taxation.

Vanuatu is not entirely tax-free for those who earn income from other sources, as individuals pay tax indirectly, including value-added tax (VAT).

Social Security

The Social Security system in Vanuatu is called the Vanuatu National Provident Fund (VNPF). The contribution is 12% of remuneration, as of 1 January 2026, with the employee’s contribution currently set at 6% and the other 6% contributed by the employer. Self-employed individuals are not required to join the VNPF but may participate voluntarily.

One of the most significant tax benefits for businesses in Vanuatu is the 0% corporate income tax rate. Regardless of a company’s size, it does not pay tax on corporate profits.

Vanuatu has had a corporate income tax-free regime for many years, and it applies to both local- and foreign-sourced profits of a Vanuatu-resident company.

The 0% corporate tax does not mean businesses are free from taxation. Companies incur costs for business licenses, stamp duty, and VAT at 15% on applicable goods and services. Employers pay 6% of the 12% on remuneration for the Vanuatu National Provident Fund (VNPF) contribution.

Companies that let commercial or residential property pay either a rent tax of 12% or 15% VAT. The tax type depends on whether they’re VAT-registered and whether the tax is above or below the VT 4 million (about $34,000) threshold within 12 months.

Tax rates are taken from the official website of the Vanuatu Customs and Inland Revenue.

Property ownership in Vanuatu is tax-free. However, when buying a property, you are required to pay a tax of at least 7% in stamp duty and property registration.

Vanuatu taxes on real estate

The table below lays out different real estate taxes and the rates at which they are charged, according to the Stamp Duties Act [CAP 68] and the Vanuatu Financial Services Commission (VFSC) and the Department of Customs and Inland Revenue:

The national currency used in Vanuatu is the Vatu (VT). Rental income tax is charged every six months on amounts exceeding VT 200,000 (about $1,692). Rental income tax is charged in two stages:

• Tax for the period from 1 December to 31 May must be paid on 28 June.
• Tax for the period from 1 June to 30 November must be paid on 28 December.

Rental tax for individuals

Under the Rent Tax Act [CAP 196], Individuals who own Vanuatu real estate and rent it out are required to pay rental tax. If the rental income for six months is lower than VT 200,000, then rental income tax is not charged. If the rental income for six months exceeds VT 200,000, a 12.5% income tax applies to property rented for over three months.

If the property is rented for under three months and the amount is over VT 4 million (about $34,000) in a 12-month period, the owner must be VAT-registered and pay 15% VAT instead of rental tax.

Rental tax for companies

Rental income tax rules for companies differ from those for individuals, as there is no tax-exempt threshold or distinction based on the length of the rental period. The tax rate, when it applies, is the same: 12.5% rent tax on income under VT 4 million, 15% VAT, and a requirement for VAT registration for rental earnings over VT 4 million.

If you own an international company operating in Vanuatu, it’s important to keep accounting records. However, you are not required to submit reports regarding this data to the Vanuatu Customs and Inland Revenue Department (CIRD).

Under Vanuatu privacy laws established in the International Companies Act [Cap. 222], access to a company’s financial records or the personal data of its owners is not allowed.

Under section 55 of Vanuatu’s Financial Institutions Act, banks in Vanuatu must maintain customer confidentiality unless a court or legal authorities require disclosure in connection with matters such as money laundering and terrorism, in compliance with the requirements of the Financial Action Task Force (FATF).