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Which countries have reduced corporate tax rates? How do I know which one would be best for me?

So many businesses and individuals are now looking overseas to branch out, open or move their companies and trade too as tax rates are becoming so high in the UK.

It can be daunting to decide which country is best to move to, as well as understanding what the new tax rates would be and how to manage them.

So many people ask us ‘which countries have reduced corporate tax rates’ as well as asking which would be the best choice; this article will explore the different tax rates across various countries so you can better understand your options.


Corporate income tax rates #

Corporate taxes vary widely from country to country. While some regions have corporate tax rates of 25% and higher, others have corporate tax rates as low as 12% and under!

Such a range is what is driving many businesses and sole traders to work abroad.

What is corporate tax? #

Businesses have to pay tax on all money made from operations. Corporate tax rates vary around the world; usually calculated as a percentage of total profits. If a company fails to follow tax regulations of their country of operation, there are potential penalties such as fines or legal proceedings.

It is important to remain compliant with all tax reporting to avoid such consequences. Corporation and international investors now look to reduce their tax burdens by moving to another country, in order to benefit from more favourable policies.

RHJ Accountants operate in many countries across the world, which provide much lower corporate tax rates than the UK which can result in businesses saving thousands.

Which countries have reduced corporate tax rates?

The United Arab Emirates #

The UAE is an ideal destination for businesses looking for increased economic profits, and a reduction in their tax burden. For expats seeking greater opportunities, a salary exempt from taxation in the UAE can be translated into a larger income and greater prosperity.

The United Arab Emirates has become an important center of global business, thanks to its tax system. Until last year, the country offered 0% corporate tax. But now, corporations with income below 375,000 AED, for main land companies only, will no longer have to pay taxes – while income above this level will be taxed at 9% starting from June 2023. Wheres the UAE’s freezones still remain at the 0% corporate tax rate.

Which countries have reduced corporate tax rates?


Portugal #

Whether you want to take advantage of moving abroad, benefiting from numerous tax reduction programs, or expanding your business, we can help you to get started.

Additionally, the nation offers a ten-year tax reduction called Non-habitual Residency or NHR. This attractive tax scheme for expatriates and investors in Portugal, is very popular as it grants them reduced tax rates and exemptions on certain taxes. To date, more than 10,000 non-habitual residents have been reaping the benefits of the program.

For businesses earning profits of £250,000 or more, taking advantage of Portugal’s 5% corporate tax rate is easy! Use our online calculator to quickly find out if you meet the Portuguese guidelines. Even if you’re not eligible, schedule a consultation with our team to discover the other benefits Portugal has to offer.

Which countries have reduced corporate tax rates?


Malta #

If you’re looking to pay a reduced amount of corporate tax, Malta can provide a more structured personal tax platform and attractive benefits for new business ventures.

Not only does Malta possess an appealing taxation system, it also provides some of the most rewarding tax advantages in Europe. With a 5% corporate tax rate you can save your business thousands. The low corporation tax rate of 5%, is one of the most affordable in the EU, therefore it is such a huge incentive for businesses seeking to cut down on taxes. This is why Malta is one of the top choice for companies.

Our team of qualified, international accountants can reassure clients that the 5% corporation tax rate is legitimate. RHJ Accountants wouldn’t want you to put your business at risk, and we would not want to be impacted either. So we can confirm that 5% corporation tax in Malta is legit!

Which countries have reduced corporate tax rates?


Cyprus #

With it’s favourable taxation policies, thoughtful immigration regulations, and prosperous business environment, Cyprus has become one of the world’s most sought-after countries for businesses and families looking to relocate and thrive.

Though small in size, Cyprus’ economic standing and international renown make it a pivotal member of Europe and the global community.

Companies registered in Cyprus are liable for a single flat rate of 12.5%, as well as non-residents, whose earnings from a permanent establishment within the nation are subject to taxation. Furthermore, income from certain specific interests and certain types of dividends are also taxed at higher rates.

Which countries have reduced corporate tax rates?


How do I know which one would be best for me? #

It is generally assumed that these decreasing levels are due to the process of taxation rivalry; countries have intensified their competition with each other to lure capital investments into their economies by diminishing their taxation rates on corporate profit.

For businesses to succeed, certain parameters must be established, including an advantageous economic climate, principles such as the rule of law, and transparency. Without these, countries become undesirable for businesses, hampering their expansion and success. For example, high corporate tax rates, a lack of qualified human capital, extreme government regulation, a weak judicial system, and harsh anti-monopoly regulations all work to undermine a country’s market opportunities.

Of the greatest importance is a free market that allows for the exchange of goods and services driven by supply and demand. It often includes all the necessities necessary for businesses to thrive. To motivate corporate growth and prevent money from exiting the domestic market, many countries have decreased their corporate tax rate.


Let RHJ Accountants help you save! #

Understanding the motivations of countries when it comes to corporate taxes is a key factor when making a decision on the best tax rate for your needs. Some countries lower their rates to attract businesses, while others such as the UAE don’t even need to charge any tax.

It comes down to making a trade-off: each country is offering something different and unique. To avoid complications and make sure you are selecting the best option for your business, it is best to contact an expert to get a free consultation and review your situation.

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💬 PSA: between April & June our Portuguese team have limited meeting availability due to the Tax Return Submission Period 🇵🇹