Form a Marshall Islands company
Marshall Islands tax guide 2026

Marshall Islands tax for companies: exempt by statute, if it stays non-resident

Updated 10 November 20262025 tax laws includedAbout 9 minutes to read
The short answer

A Marshall Islands company that does no business on the islands pays no tax there: the exemption is in section 12 of the company law, and covers later tax laws too.

The 16% profit tax and 12% consumption tax from 1 October 2026 are for local businesses. Every company still files a yearly substance report.

Am I still non-resident? My report dates
Statutory exemption 0% Marshall Islands tax on a non-resident company, written into the company law The 2025 tax laws starting 1 October 2026 are aimed at businesses on the islands.

A Marshall Islands company that does no business on the islands is exempt from tax by the company law itself, not by a ruling or a certificate. In 2025 the islands passed new profit and consumption taxes starting 1 October 2026. Here's why they're aimed at local businesses, what would make your company one, and the yearly substance report every company files.

Key takeaways

  • A non-resident company is exempt from income, withholding and stamp taxes under section 12 of the Business Corporations Act.
  • The exemption covers tax laws "now in effect or hereinafter enacted".
  • "Non-resident" means no business in the islands; registering a ship there is allowed.
  • From 1 October 2026, resident businesses pay 16% on net profit under the Net Profit Tax Act 2025 and 12% consumption tax above US$300,000.
  • Every company files an economic substance report within 12 months of each anniversary.
  • There are no double tax treaties, only information exchange agreements, such as the UK agreement in force since 2014.
Chapter 1

Marshall Islands company tax: the section 12 exemption

US$150,000 profit, no local businessNon-resident
Profit taxUS$0
Withholding on payoutsUS$0
2025 net profit taxNot aimed at it
Yearly filingSubstance report
Your own country may tax the company or what it pays you. Where you live: pick it
0%Income and profit tax on a non-resident company
0%Withholding on what it pays to non-residents
0%Stamp duty on its shares and documents
No reportingOf its revenue to the islands' tax office

The same exemption sits in the LLC Act, s.70(3), and the Revised Partnership Act, s.73. It applies whatever the company earns abroad.

1
Key takeaway

Section 12 exempts it from tax laws now in force and those enacted later.

Chapter 2

What makes a Marshall Islands company resident?

Customers on the islands
Office, staff or property on the islands
Ships registered in the Marshall Islands

Section 2(q) of the Business Corporations Act lists what a non-resident company may and may not do.

2
Key takeaway

Do business on the islands and it becomes a local taxpayer.

Chapter 3

Marshall Islands 2025 tax reform: who it reaches

A non-resident company
A business on the islands
  • 16% net profit tax from 1 October 2026
  • Gross revenue tax kept only for small local firms under US$300,000
  • 12% consumption tax above US$300,000 of sales
3
Key takeaway

16% profit tax and 12% consumption tax from October 2026, for local business.

Chapter 4

Marshall Islands economic substance: the check

The company
Managed from, and tax resident in, a country with company tax

The test comes from the Economic Substance Regulations 2018, unamended since 2019. The Registrar's substance guidance lists the relevant activities, and its portal guide of May 2026 walks through the report.

4
Key takeaway

Every company reports. Only nine activities need more.

Chapter 5

Marshall Islands annual fee and substance report dates

A missed report suspends all corporate services; still missing 12 months after the deadline, the company is annulled, as the Registrar's substance FAQs explain. Failing the test costs up to US$50,000, then US$100,000, under the Economic Substance Regulations.

Both clocks, what happens when either runs out, and the records duties: Marshall Islands annual fees and filings.

5
Key takeaway

A fee on each anniversary and a report within 12 months of it.

Chapter 6

Is the Marshall Islands a tax haven?

  1. December 2017 to 2018First EU listingRemoved after high-level commitments.
  2. March to October 2019EU blacklistThen the watch list until February 2020.
  3. February to October 2023Listed againRemoved on 17 October 2023.
  4. 9 October 2026On neither EU listAnd not on the FATF grey list.
6
Key takeaway

Three spells on the EU lists, none since October 2023.

Chapter 7

Marshall Islands tax questions, answered

?!
Do Marshall Islands companies pay tax?
Not if they are non-resident. Section 12 of the Business Corporations Act exempts them from income, withholding and stamp taxes.
Does the 2025 Net Profit Tax Act apply to offshore companies?
The Net Profit Tax Act is aimed at businesses on the islands and does not name non-resident companies. Section 12 covers later tax laws too. No official statement confirms this yet.
What makes a Marshall Islands company resident?
Doing business on the islands: local customers, an office, staff or property there. Registering a ship there does not.
When is the Marshall Islands substance report due?
Within 12 months of each anniversary of formation, through the Registrar's portal. The first period opens on the first anniversary.
Does a holding company need substance in the Marshall Islands?
A pure holding company usually meets the light test through its registered agent, as the Registrar's substance guidance says, with the yearly report filed.
Has the EU taken the Marshall Islands off its tax blacklist?
Yes. Its last listing ended on 17 October 2023, and it is on neither list in 2026. Banks still ask why a company is there; our bank account guide covers it.
Is the yearly substance report in your price?
Yes. Our Marshall Islands company includes the report, agent and government fee every year.

Changelog

  • 10 November 2026: first published.
  • 13 November 2026: official sources linked in the text.
Your Marshall Islands company

A Marshall Islands company with the substance report filed for you.

US$699 a year, agent and filings included.

See the Marshall Islands company Compare tax havens