Personal Income Tax (IGR) 2026 – San Marino

Lowest tax bracket. Very low rate for basic income earners. Applies to first €10,000 of annual income. Tax on €10,000 = €900.

Applied to income between €10,000 and €15,000 only. Not cumulative. On €15,000 total income: pay 9% on first €10,000 + 12% on next €5,000 = €1,500 total tax.

Corporate tax rate level. Applied to income in this range. Moderate rate for middle-income earners.

Fourth bracket. Most employees fall within or below this bracket. Combined with social contributions, effective rate increases.

Upper-middle income bracket. Above €28,000 minimum taxable base for social contributions. Total tax burden includes 8.3% social contributions + 23% income tax = 31.3% marginal.

Higher income bracket. Well-paid professionals. Marginal rate 34.3% including social contributions.

Second highest bracket. High earners. Combined marginal rate 38.3% with social contributions.

Top bracket for individuals. Applied to all income above €80,000. Maximum marginal rate 43.3% including 8.3% social contributions. Still competitive compared to Italy (up to 43% plus regional taxes).

Salaries, wages, bonuses taxed at progressive rates. Employer withholds income tax monthly (PAYE system). Annual tax return reconciles total. Mandatory 13th salary (Christmas bonus) also taxed. Pension income taxed as employment income but considered taxable at lower effective rates.

Business income from individual activity. Taxed at same progressive rates as employment. Can deduct business expenses. Must make quarterly estimated tax payments. Annual reconciliation required.

Companies taxed at proportional 17% rate regardless of profit level. Lower than Italy (24% + 3.9% regional = 27.9% total). Calculated on taxable income after deductions. New businesses get 50% reduction (8.5%) for first 5 years.

Property rental income taxed as ordinary income at progressive rates. Can deduct expenses: maintenance, property management, depreciation. Must declare all rental income including from foreign properties if resident.

Interest on loans to non-residents: 13% withholding tax. Dividends to individuals: 5% withholding. Capital gains from shares: exempt if held 12+ months and reported as financial fixed assets. Bond interest: 4% withholding for individuals.

Resident if: (1) registered residence in San Marino, OR (2) stay exceeds 6 months (183 days) in calendar year. Residents taxed on worldwide income. Must declare foreign income, bank accounts, investments. Tax treaties prevent double taxation.

Non-residents taxed only on San Marino-source income at same progressive rates. Includes: San Marino employment, business operations in San Marino, rental income from San Marino property, director fees from San Marino companies. No tax on foreign-source income.

Approximately 8,000 people commute daily from Italy to work in San Marino. Italy-San Marino tax treaty determines taxation. Generally taxed in country of work (San Marino) but provisions vary. Treaty prevents double taxation. Must file in both countries.

All new business activities benefit from extraordinary treatment for 5 years: corporate tax reduced from 17% to 8.5%. Plus exemption from annual authorization fee and renewal fees for first 3 years. Significant advantage for startups and entrepreneurs.

Highly innovative startups qualify for special regime with progressive profit tax from 0% to 8%. Even lower than general startup rate. Must meet innovation criteria. Encourages technology and R&D-focused companies.

Trust companies pay standard 17% tax but on reduced taxable income: either 80% of total proceeds, OR 10% of proceeds when reinvested and held 24+ months. Favorable regime for asset management industry.

Unique deduction: expenses incurred in San Marino with SMaC Card (special card for residents) deductible from tax on employment income. Encourages local spending. Also available to residents with other income types subject to ordinary taxation.