At a glance
Rules in force in 2026, read on official sources between 23 October and 2 November 2026. These are the rates set by law.
| Corporate tax | Special regimes in the law | Dividends to a non-resident individual | VAT | When the company is resident | |
|---|---|---|---|---|---|
| Bulgaria | 10% | None found | 5% | 20% | Incorporated under Bulgarian law |
| Cyprus | 15% from 2026 | — | No Special Defence Contribution for a non-resident or non-domiciled individual; on dividends paid to non-resident companies it applies only if they are resident in a jurisdiction on the official lists (5% or 17%) | 19% | Management and control in Cyprus; the rule on companies incorporated in Cyprus is not verified on an official source |
| Estonia | 22% only on distributed profit; retained profit is not taxed | — | Not taxed in Estonia from 2025 | 24% | Established under Estonian law; if managed from abroad, its income is also taxed abroad |
| Hungary | 9% | Small business tax (KIVA): 10% on its own base, instead of corporate tax and social contribution tax | 15% without a treaty | 27% | Set up under Hungarian law, or managed from Hungary |
| Ireland | 12.5% on trading income, 25% on other income | — | 25% withholding, with an exemption on Form V2A for EU, EEA and treaty residents | 23% | Incorporated in Ireland (unless a treaty says otherwise), or with central management and control in Ireland |
| Lithuania | 17% from 2026 | 7% for small companies with income up to EUR 300,000; 0% in the first two tax periods for new small companies | 15%, or the treaty rate | 21% | Not verified on an official source |
| Luxembourg | 14% up to EUR 175,000; between EUR 175,000 and 200,000, EUR 24,500 plus 30% of the income over EUR 175,000; 16% above EUR 200,000; 23.87% in Luxembourg City with the employment-fund surcharge and municipal business tax | — | 15%, or the treaty rate | 17% | Registered seat or seat of effective management in Luxembourg |
| Malta | 35%, with refunds to shareholders when profit is distributed; or a final 15% by election | Shareholder refunds, as a rule 6/7 of the tax | None on dividends from taxed profits | 18% | Incorporated in Malta, or managed and controlled from Malta |
| Poland | 19% | 9% for small taxpayers and in the first year, with revenue up to EUR 2 million | 19% | 23% | Registered seat or management in Poland |
| Portugal | 19% in 2026, 18% in 2027, 17% from 2028 | 15% on the first EUR 50,000 for SMEs; Madeira Free Zone: 5% until 2033 for entities licensed by the end of 2026, with conditions | 28% | 23% (Madeira 22%) | Registered office or effective management in Portugal |
| Romania | 16% | Micro-enterprises: 1% of revenue in 2026, up to EUR 100,000 of revenue, with at least one employee | 16% from 2026 | 21% | Set up under Romanian law, or with its place of effective management in Romania |
| Spain | 25% | 15% for new companies in their first two profitable years | 19% | 21% | Incorporated under Spanish law, or with its registered office or place of effective management in Spain |
A rate says little on its own: local taxes, social contributions, the tax on dividends and the tax in the country where you live all count as well.
The countries one by one
Malta. Companies pay 35% on chargeable income. When dividends are paid, the shareholder may claim a refund of part or all of the tax the company paid, as a rule 6/7, depending on the kind of income. A company may instead elect a final 15%, with no refunds, for at least five years. See Malta vs Cyprus and Estonia vs Malta.
Cyprus. Companies pay 15% from 1 January 2026. Individuals who are not Cyprus tax resident, or not domiciled in Cyprus, pay no Special Defence Contribution on dividends. On dividends paid to a non-resident company it applies only if that company is resident in a jurisdiction on the official lists: 5% or 17% depending on the list.
Estonia. A company pays tax only when it distributes profit, at 22/78 of the net amount, which is 22% of the gross; profit kept in the company is not taxed. The rise planned for 2026 was cancelled. From 2025 Estonia does not tax dividends received by non-resident individuals. See Poland vs Estonia.
Ireland. 12.5% on trading income and 25% on non-trading income such as rent and investment income. Groups with revenue over EUR 750 million pay at least 15%. Dividends carry 25% withholding, with an exemption for EU, EEA and treaty residents on Form V2A. See Ireland vs UK.
Bulgaria. A flat 10% on profit. Dividends paid to an individual bear a final 5% tax, and there is no withholding on dividends paid to an EU or EEA company. A company is resident if it is incorporated under Bulgarian law. From 1 January 2026 VAT registration is due at EUR 51,130 of turnover.
Hungary. 9% on profit. Businesses with up to 100 staff and up to HUF 6 billion of revenue can choose the small business tax (KIVA) instead: 10% on a base made of personnel payments and capital and dividend items, replacing corporate tax and social contribution tax. Municipalities levy a local business tax of up to 2%.
Romania. 16% on profit. Micro-enterprises, Romanian companies with revenue up to EUR 100,000 and at least one employee, pay 1% of revenue from 2026; one that passes the limit during the year pays profit tax from that quarter. Dividends paid to non-residents from 2026 bear 16% withholding.
Lithuania. From 1 January 2026 the rates are 17% and, for small companies, 7%. The 7% rate applies when income for the tax period does not exceed EUR 300,000, with a limit on who holds the shares; a newly registered small company pays 0% in its first two tax periods. Dividends paid to individuals bear 15% withholding, or the lower rate of a treaty. When a company is resident, and how one managed from abroad is treated, is not verified on an official source; ask a firm in Lithuania.
Poland. 19%, or 9% for small taxpayers and in the first year with revenue up to the equivalent of EUR 2 million. Dividends paid to individuals bear 19%.
Portugal and Madeira. The rate falls year by year: 19% in 2026, 18% in 2027, 17% from 2028; SMEs pay 15% on the first EUR 50,000 of profit. In the Madeira Free Zone, entities licensed from 2015 to 31 December 2026 pay 5% until 31 December 2033 if they create jobs and, with few staff, invest at least EUR 75,000; the profit taxed at 5% is capped. Dividends bear a final 28% withholding.
Luxembourg. From 2025 corporate income tax is 14% up to EUR 175,000 of income and 16% above EUR 200,000; in between it is EUR 24,500 plus 30% of the income over EUR 175,000. The employment-fund surcharge and the municipal business tax come on top, for a total of 23.87% in Luxembourg City. Dividends paid to non-residents bear 15% withholding, or the treaty rate.
Spain. 25%, with 15% for new companies in their first two profitable years, and 19% and 21% in 2026 for companies with turnover below EUR 1 million. Dividends paid to non-residents bear 19%.
Tax residence: getting it right
The rate of the country you choose applies when the company is actually resident there. Before you set up, prepare the answers to these questions:
- Where will the company’s decisions be taken? If the company is in fact run from the country where you live, that country may treat it as resident and tax its profits.
- Where will you live? Your own tax residence follows the rules of the country you leave, not only your registration abroad.
- Where will your dividends be taxed? The country where you live may tax the dividends you receive and, under its rules on controlled foreign companies, the company’s profits as well.
- What substance will the company have in the chosen country? Directors, premises and activity that match the structure.
With these answers a firm in the chosen country can set up the structure, and an adviser where you live can confirm your position.
“Offshore” and “tax haven”: what they mean today
Many people arrive here searching for “tax haven” or “offshore company”. Today those words point mostly to jurisdictions outside the EU that do not cooperate on tax information, and the rules around them have changed:
- The EU list of non-cooperative jurisdictions is agreed by the Council of the EU, reviewed twice a year and covers only countries outside the EU. After the revision of 9 October 2026 it names eight: American Samoa, Anguilla, Guam, Palau, the Russian Federation, Turks and Caicos Islands, US Virgin Islands and Vanuatu.
- Automatic exchange of information: banks and other financial institutions report the balances and income of non-residents’ accounts, and each year EU countries send them to the account holder’s country of residence; the OECD Common Reporting Standard behind it has more than 120 committed jurisdictions.
- Beneficial ownership registers: EU anti-money-laundering rules require a register of who owns and controls companies; since a Court of Justice judgment of 2022 it is no longer open to any member of the public in all cases.
- A 15% minimum tax applies in the EU to groups with revenue of at least EUR 750 million; it does not apply to smaller companies.
- Controlled foreign company rules are applied by every EU member state.
The legal, transparent alternatives are the ones in the table: EU countries with low rates (Bulgaria, Hungary, Ireland, Cyprus), with tax only on distributed profit (Estonia), with a refund system (Malta) or with regimes for small and new businesses (Romania, Poland, Portugal, Spain). They work when the company is genuinely managed in the chosen country and the rules of the country where you live are respected.
How to choose
Three questions narrow the choice: where you will live and work, where your customers are, and who will run the company. The Which jurisdiction fits you? questionnaire asks them, with four more, and shows the destinations that meet the most answers, with the facts behind each match. It never sorts by tax rate. For costs, use the setup cost calculator.