Monaco VAT on non-resident digital services

Foreign providers liable to register and collect VAT on electronic, broadcast and telecoms services

The French Riveria city-state of Monaco imposes 20% Value Added Tax on sales of digital or electronic services to its consumers. Whilst not part of France or the European Union, Monaco is considered a part of the French VAT area, following its rules and rate, with the French Public Finances Directorate General. Non-residents which must register for VAT in Monaco, do so with the Monaco Tax Department through an accredited tax representative if a non-EU resident provider.

There is no VAT registration threshold for foreign providers. Like France and the EU, facilitating marketplaces or digital platform deemed supplier rules switch the obligations to them.

Electronic, telecoms and broadcast services includes:

• Streaming or download media; tv; music; video; images; text and similar;
• E-books;
• SaaS
• Server access and data storage;
• Website hosting;
• Online gaming
• Advertising
• Some e-learning if fully automated
• Telecom’s services

 There is a requirement for  the appointment of fiscal representative by non-EU resident taxpayers.

Check our global VAT on digital services tracker. There are now over 120 countries imposing VAT obligations on non-resident providers of digital services.

VAT in Monaco – the links to France and the EU

Monaco’s VAT system is intricately linked to that of France due to the 1963 Customs Union treaty between the two countries. As a result, Monaco applies French VAT rules under the framework of the French Code Général des Impôts. This integration effectively makes Monaco a de facto part of the European Union VAT area, despite its non-EU status.

Monaco levies VAT on goods and services similarly to France, applying standard VAT rates of 20%, with reduced rates for specific categories like food, books, and certain services. VAT is imposed on taxable persons who sell goods or provide services within Monaco, and it functions as a tax on the added value at each stage of production or service delivery. VAT is ultimately borne by the final consumer.

Differences arise, however, due to Monaco’s legal standing outside the EU. For transactions involving EU Member States, Monaco’s VAT is treated as though the country were within the EU VAT zone, but for non-EU transactions, Monaco is treated as a non-EU country. This duality can create complexities in determining the correct VAT treatment for cross-border sales. Moreover, Monaco’s customs formalities and VAT processes often rely on administrative procedures aligned with, but distinct from, EU practices.

Europe VAT on digital services