The Ordonnance Souveraine N° 8.566 of 28 March 1986 relating to the certificate of residence was recently amended by a new Sovereign Order N° 8.372 dated 26 November 2020. Order N° 8.566 now distinguishes the nature of the requests for the issuance of a residence certificate that must be made to the Public Security Directorate. Thus, the formalities will be considered as a Monegasque administrative formality or a formality of a fiscal nature. As far as tax formalities are concerned, Ordinance n° 8.566 includes the definition of the notions of “principal or habitual residence” and “main center of interests”.
The criteria for obtaining a tax residence certificate according to the new regulation
From December 2020, in order to apply for a tax residence certificate, the applicant will have to present the following documents to the Sureté Publique:
– A valid Monaco resident card
– An application form declaring Monaco to be the applicant’s principal place of residence, or “foyer” or center of their interests
– Proof of housing in Monaco (title deed, lease)
– Water, electricity and telephone bills for the year in question as well as any other document proving residency;
– Any other document that may be requested by Public Security within the scope of their investigations.
The principal place of residence
The notion of “principal place of residence” is very close to the French definition used for French taxes.
If the applicant stays at least 183 days of the year in Monaco, Monaco will be considered to be the applicant’s principal or habitual residence.
For stays of less than 183 days per year, if the applicant is physically present in Monaco for a longer period of time than he or she spends in any other country, Monaco will still be considered to be the applicant’s principal residence.
If the place of principal residence cannot be determined, the “Sureté publique” will take into account the place of “foyer”. We note that in France the foyer is considered in the first place and the place of residence in the second place.
Under French tax law, a taxpayer’s “foyer” is the place where the taxpayer and/or his family usually live, or the place where the interests of the family are based. We understand the degree of permanence in the term “usually” which means that presence in France should not be occasional.
To define what we consider as a foyer, two conditions must be met: the center of family interests and the place where the taxpayer usually lives.
If the applicant does not meet the criteria of principal residence or foyer and wishes to use the option of the “center of interests” to obtain the residence certificate, he must show that Monaco is the place in question :
– where the applicant has made his or her main investments
– where its business activities have their registered office or place of effective management
– where they manage their assets