While most countries consider dividends as a form of income, they take vastly different approaches to how they levy a dividend tax. To genuinely be an effective strategy, tax optimization must involve a global perspective, especially when you generate wealth rather than income.

HNW entrepreneurs, investors, and families generate significant wealth through dividends of one type or another. Thus, how they subject themselves to a dividend tax dramatically impacts their contemporary wealth and ability to create enduring wealth.

 All countries approach taxation differently, and some offer HNW entrepreneurs, investors, and families beneficial tax incentives – such as Non-Dom Tax Programs – once they gain residency in the country.

These benefits can also include highly favorable dividend tax regimes, including genuine zero-tax environments and low dividend tax rates. 

 HNW entrepreneurs, investors, and families partner with Astons to gain residency or citizenship in tax environments that best serve their interests.

Countries with no or low tax on dividends

Greece

Greece offers a flat dividend tax rate system, and the applicable rate is generally dependent upon three factors:

  • Greek residency
  • Personal vs corporate taxation
  • Foreign vs domestic source

Generally speaking, Greece’s dividend tax is only 5%, and along with Bulgaria, it has the lowest dividend tax in the EU among nations that tax dividends.

However, a more favorable tax rate may be possible with Greek residency due to double taxation treaties, such as the US-Greece double taxation treaty.

However, the dividend tax rate could increase to 10% in certain situations. 

Considering the fact that in the US and UK, tax on dividends can reach as high as 40%, Greece is an extremely appealing option.

Greece also offers an annual flat tax payment non-dom program as well as a pensioner flat tax program.

 Greece’s dividend tax rate and corresponding legislation make the country especially attractive to HNW entrepreneurs, investors, and families who generate wealth through private equity and venture capitalism.

The Caribbean

Various countries in the Caribbean are genuine and legitimate tax havens.

St. Kitts and Nevis is not only a beautiful country with glorious beaches and warm, crystal-clear water, but it also levies no tax on dividends, profits, or any other forms of income.

Other Caribbean dividend tax havens include:

However, it should be noted that, unlike in the United States, in Caribbean countries, tax residency and citizenship are separate statuses, and the listed tax benefits generally apply to citizens who are also tax residents.

Brazil

 Brazil is an up-and-coming investment market, but most importantly, it is a founding member of BRICS.

BRICS nations are redefining the global market, including the importance of currency diversification and tax optimization.

Brazil is one of the largest economies—especially in the Western Hemisphere—that does not levy a dividend tax on its citizens.

Also, an interesting note to mention is that some Brazilian companies pay their dividends in US dollars rather than Brazilian reals.

Hong Kong

 Hong Kong is another world-renowned tax haven for foreign HNW entrepreneurs, investors, and families, and this includes a lack of tax on dividends.

There are no dividend taxes for dividends derived from Hong Kong-based companies.

Also, dividends from non-Hong Kong-based sources are typically counted as foreign income, meaning [in most cases] they are tax-exempt as well.

Singapore

Singapore is a critical economy and business hub in Asia, and its most important industries and sectors are:

  • Manufacturing
  • Services
  • Tourism
  • Exports 

In fact, Singapore operates the world’s busiest cargo seaport.

Though Singapore has a very complex taxation system, it levies no tax on dividends or capital gains to foster commercial growth.

Estonia 

One of the biggest myths of modern times is that Europe taxes its citizens and residents to death.

Not only is this not true, but what you get in return for taxes paid in Europe is exponentially better than in nearly the rest of the world.

Estonia is an excellent example of this paradigm.

The country has a flat income tax rate of 20% that applies to everyone, and the tax on dividends in Estonia ranges from 0% to 7%. With that said, under most circumstances, the 0% rate controls. 

As Estonia is a member of the European Union, you do not necessarily need to be a citizen of Estonia to live there and take advantage of its taxation.

EU citizens have the right to choose which EU country they wish to reside in. Thus, EU citizens [from any EU country] can reside in Estonia should they choose to and move their tax residency out of their home country if that best serves their needs.

This is also true for Latvia, Estonia’s neighbor, which is so similar regarding taxation that it doesn’t need to be mentioned separately.

United Arab Emirates

It shouldn’t be surprising that the UAE is a fairly attractive investment or taxation option.

With the UAE’s enormous national wealth, it would be a crime to tax the people—and so they don’t.

There is no dividend tax and a very low corporate tax of only 9%. The 9% corporate tax was implemented in June 2023 and marks the first time the UAE ever levied a corporate tax. Most small businesses remain tax-exempt.

However, companies involved in the oil and gas sectors are subject to their special tax rules.

 The UAE has stated its intention to slowly migrate away from its financial reliance on oil and gas, which has created a boom in other sectors, especially real estate and technology.

Cayman Islands

 Though in the Caribbean, the Cayman Islands require their own mention. 

One of the world’s original tax havens and offshore banking hubs, countless global businesses have established their headquarters here.

Not only is there no dividend tax, but there’s no corporate or personal tax.

There isn’t much more that needs to be said about the Cayman Islands.

The things you have heard about taxes and the Cayman Islands -probably true.

Monaco

It is nearly impossible to talk about historical and legitimate tax havens without mentioning Monaco.

Monaco is arguably the preeminent European tax haven catering to the lifestyles of the rich and famous.

Monaco has no dividend tax primarily due to the fact that Monaco has no income taxes at all.

Interestingly, with the immense wealth that Monaco has, it does not have its own airport, thus access to Monaco is either by yacht or through France.

Monaco is not an EU member state, but shares the same access and market privileges similar to those of Andorra, San Marino, Norway, Iceland and Liechtenstein. Also, Monaco is a Euro economy.

As a note, dividends are tax-exempt in Andorra, and in most cases, dividends and capital gains are typically tax-exempt income in Liechtenstein as well.

Saudi Arabia

 As with the UAE, Saudi Arabia is another country that genuinely has no business imposing taxes on people.

The difference is that Saudi Arabia does, though it’s minimal.

Saudi Arabia’s dividend tax differs based on various factors—such as resident vs. non-resident—but generally speaking, it ranges between 5% and 10%.

The exact rate for non-residents will depend on their country of origin and any double taxation agreements that may exist. 

While the US does not have a double taxation agreement with Saudi Arabia, the UK does.

Cyprus

Cyprus is in a unique situation when it comes to taxes on dividends or taxation in general.

Though an EU member, Cyprus is not a member of the Schengen Zone, so it tends to get overlooked within the EU community. 

However, Cyprus has begun the process of Schengen integration, and once that is complete, the Island’s value to HNW entrepreneurs, investors, and families will skyrocket. Which is why, at this time, Cypriot residency is the best investment in the EU.

From the perspective of a typical resident, the Cypriot tax code may not seem very appealing or impressive.

However, the secret is that Cyprus has the best non-dom tax program in the EU and arguably the world—especially now that the UK has terminated its Non-Dom Tax Regime.

HNW entrepreneurs, investors, and families leveraging Cypriot residency and the impressive Cyprus non-dom tax program enjoy no tax on dividends or interest.

In fact, in the Cypriot non-dom program, most foreign-based income is tax-exempt.

Malta

Only three EU countries have tax codes that apply a zero-tax approach to dividend income:

  • Malta
  • Estonia
  • Latvia

However, by far, Malta is the most impressive option.

In addition to its already favorable tax code, Malta offers a non-dom tax program that most experts suggest is a close match to the UK’s current non-dom tax regime [which is scheduled to terminate in April 2025].

Of the three EU countries where dividends are tax-free income, Malta is the only Mediterranean island surrounded by pristine beaches with year-round summer weather.

Though, it is possible that some investors would prefer northern Europe’s cold, snowy, and wet climate instead.

Malta also stands out as the only EU country with a citizenship by investment program – a direct pathway to an EU passport. 

Hungary

Another very appealing EU option is Hungary.

Hungary has one of the most successful economies in Eastern Europe and one of the EU’s best real estate markets for investing. 

Thus, it tends to attract many global HNW entrepreneurs, investors, and families.

Hungary offers the EU’s lowest corporation tax rate of 9% and a flat income tax rate of only 15%.

The Hungarian tax code considers dividends and capital gains are income, thus they fall under the 15% flat rate system – which for some HNW entrepreneurs, investors, and families may offer relief. 

However, foreign residents in Hungary can benefit from the many double taxation treaties that Hungary is a party to, including the UK. 

Astons – Lifestyle optimization for HNWIs

Astons has transformed a global industry into a private client service of lifestyle optimization for our HNW entrepreneur, investor, and family clients.

Our team of seasoned industry experts analyze each client’s unique situation and demands to identify which solutions best serve their needs and dreams.

For 35 years, Astons has played a critical role in molding our industry and our team is composed of the professionals who have helped build it – all insiders and specialists in their respective fields of expertise.

Today, Astons continues to lead from the front and partner with HNWIs with a trust-based and success-focused approach.

If lifestyle optimization is your goal, schedule your Free Confidential and Comprehensive Consultation with Astons today.