🇼🇫 Wallis and Futuna Tax Guide — Income, Corporate & VAT Rates

The tax rates in Wallis and Futuna range from 5% to 35% for personal income tax, with a corporate tax rate of 25% and a value-added tax (VAT) rate of 5%.

Tax System Overview

Wallis and Futuna, as an overseas collectivity of France, has a territorial taxation system, where only income earned within the territory is subject to tax. This means that residents are not taxed on their worldwide income, only on the income earned within Wallis and Futuna. To be considered a resident for tax purposes, an individual must have their domicile or residence in Wallis and Futuna, or spend more than 6 months in the territory during a calendar year.

The tax system in Wallis and Futuna is relatively straightforward, with a focus on simplicity and ease of compliance. The territory has a single tax authority, the Service des Impôts, which is responsible for administering and collecting all taxes. The tax year in Wallis and Futuna runs from January to December, and taxpayers are required to file their tax returns by the end of April of the following year.

Personal Income Tax

Personal income tax in Wallis and Futuna is relatively low, with a top marginal rate of 35%. Taxpayers are allowed to claim deductions for expenses such as mortgage interest, charitable donations, and medical expenses. Allowances are also available for dependents and other family members. Tax returns must be filed electronically, and taxpayers can claim a refund if they have overpaid their taxes during the year.

Corporate & Business Tax

• The corporate tax rate in Wallis and Futuna is 25%, which applies to all businesses operating in the territory.
• Small businesses with annual turnover of less than XPF 1 million are eligible for a reduced tax rate of 10%.
• The territory has a free zone in the port area, where businesses can operate with reduced taxes and regulations.
• Businesses must register with the Service des Impôts and obtain a tax identification number before commencing operations.
• Companies must file their tax returns and pay any taxes due by the end of April of the following year.

VAT / Sales Tax

• The standard VAT rate in Wallis and Futuna is 5%, which applies to most goods and services.
• A reduced rate of 2.5% applies to essential goods such as food, medicine, and education.
• Certain goods and services, such as financial services and real estate, are exempt from VAT.
• Tourists can claim a refund of VAT paid on goods purchased in the territory, provided they meet certain conditions.

For Expats & Foreign Workers

• Expats and foreign workers are considered tax residents if they spend more than 6 months in the territory during a calendar year.
• Double taxation treaties are in place with 16 countries, including France, to prevent taxation of the same income in multiple jurisdictions.
• Social security contributions are required for all employees, including foreign workers, at a rate of 10% of gross salary.
• Remittances of income earned in Wallis and Futuna are subject to a withholding tax of 10%, which can be reduced or eliminated under a double taxation treaty.
• Foreign workers may be eligible for a tax exemption on their foreign-earned income, provided they meet certain conditions.
• Expats and foreign workers must register with the Service des Impôts and obtain a tax identification number before commencing work in the territory.

Crypto & Investment Income

• Investment income, including dividends and interest, is subject to a withholding tax of 10%.
• Capital gains are taxed at a rate of 25%, or can be included in taxable income and taxed at the applicable rate.
• Cryptocurrency is considered a financial asset, and gains from its sale are subject to capital gains tax.
• Taxpayers must declare their investment income and capital gains in their tax return, and pay any taxes due by the end of April of the following year.