Curaçao

- Select the Country/Jurisdiction
- Anguilla
- Argentina
- Australia
- Austria
- Bahamas
- Bahrain
- Barbados
- Belgium
- Belize
- Bermuda
- Brazil
- British Virgin Islands
- Brunei
- Canada
- Cayman Islands
- China
- Colombia
- Curaçao
- Cyprus
- England and Wales
- France
- Germany
- Gibraltar
- Greece
- Guernsey
- Hong Kong
- Hungary
- India
- Ireland
- Isle of Man
- Israel
- Italy
- Japan
- Jersey
- Liechtenstein
- Lithuania
- Luxembourg
- Malaysia
- Malta
- Mauritius
- Mexico
- Monaco
- Netherlands
- Nevis
- New Zealand
- Northern Ireland
- Panama
- Poland
- Republic of South Africa
- Russia
- Scotland
- Seychelles
- Singapore
- Spain
- St Kitts
- St Lucia
- Switzerland
- Trinidad and Tobago
- Turks and Caicos
- United Arab Emirates
- United Kingdom
- United States
- Uruguay
Find legal, tax and practice information for Curaçao, and search for branches and members in the jurisdiction. If you have any comments on the report please contact [email protected]
*Updated July 2020*
Editorial Board
- Angeliek Jacobs TEP, Helix Management BV, Curaçao
- Robert Bottse (lead editor), HBN Law & Tax, Curaçao
With special thanks to Henri Th M Burgers, Burgers & Fung-A-Loi Notarissen, Curaçao
Quick links
- Legal system
- Inheritance and succession
- Estate planning
- Taxation
- Residence and domicile
- Other relevant information
Legal system
The legal system is based on civil law. The main body of civil law is the Civil Code. Most laws are, to a large extent, based on their Dutch equivalent. In book three of the Civil Code, which deals with property law, a section has been included allowing the creation of a trust modelled after Anglo-Saxon law. Curaçao is the only country within the Kingdom of the Netherlands that allows this type of structuring. Curaçao has a Court of First Instance and a Court of Appeal. The supreme court is the Supreme Court in The Hague, Netherlands.
Inheritance and succession
Succession
There are no forced-heirship rules. Everyone above 16 years of age is entitled to make a last will and they are completely free to dispose of their estate.
Book four of the Civil Code contains the inheritance laws, divided into intestate succession and testamentary succession.
Intestate succession: there are four classes of succession. If one or more members of a class are alive then the subsequent class is excluded from inheritance. The classes are: first, surviving spouse and children; second, parents and brothers and sisters; third, grandparents of the deceased; fourth, great grandparents of the deceased, in each class in equal parts.
Legal partition: if the deceased was married and one or more children were born within that marriage, and if the deceased did not leave other children, then the surviving spouse, by law, acquires all properties belonging to the estate under the obligation to pay all debts of the estate. The children get a claim on the surviving spouse that is equal to the value of their share. This claim is not demandable during the lifetime of the surviving spouse, except in case the spouse remarries or is declared bankrupt.
There is a complete freedom of making wills. Last wills are made by notarial deed. By exception, wills are made by private deed and deposited with a notary, who makes a notarial deed of deposit to be signed by the notary and the testator.
For certain dispositions a codicil may be made. These dispositions are: bequests of clothing, specific jewellery and belongings, specific books and specific furniture. Other assets cannot be bequeathed by codicil.
A testator may put their estate or part thereof, or specific goods of their estate under administration (bewind) and appoint an administrator (bewindvoerder) for a period of time or during the lifetime of the heir(s). This administration is similar to a trust, but (unlike the trustee) the administrator is not considered the owner of the assets under administration.
Family law and defined inheritance rules
Persons of the same sex cannot marry in Curaçao. However, a valid same-sex marriage entered into in the Netherlands is recognised in Curaçao.
The legal system of matrimonial property law is the community of goods. Husband and wife each have one-half undivided part in the community of goods. By a prenuptial agreement or by an agreement during the marriage (both to be executed by notarial deed) husband and wife may deviate from the system of community of goods, for instance a complete separation of goods or a limited community of goods. Each spouse is free to dispose of the goods they acquired for the community of goods.
The debts of one of the spouses can be recovered from the entire community of goods as well as from the private property of the spouse who entered into the debt/obligation.
After 2000, anything inherited during the marriage does not form part of the community of goods and is considered the spouses private property. The same applies if a testator in their last will stipulates that the inheritance does not form part of any community of goods, as also is the case with property inherited after 2001, but before the marriage.
Probate process
Curaçao does have a probate process. It is the notary (notaris) who does the research at the civil registry and the register of last wills and declares the beneficiaries of the estate.
Mental capacity
Persons under 18 years of age do not have the capacity to perform legal acts on their own and without the consent of a parent or guardian. When they are married, however, they are of age (even under 18) and can perform legal acts.
For a person of age who is mentally ill, a curator can be appointed by the court of first instance in order to protect this person. It is also possible to have certain or all properties of a person placed under administration by the court of first instance, in case the person cannot handle their affairs due to a physical or mental handicap.
Estate planning
Use of trusts in estate planning
A Curaçao trust has the following characteristics:
- the trust is not a legal entity;
- the trust property is separated from the property of the trustee;
- the trustee has the power and duty to manage the assets of the trust
- a trust is created by notarial deed, executed in front of a notary in Curaçao;
- the trust deed must include at least the following provisions;
- the appointment of a beneficiary or beneficiaries or the description of a specified purpose;
- the appointment of a resident trustee and the acceptance of this appointment by the trustee;
- a description of the assets of the trust;
- the name of the trust, which must include the word ‘trust’;
- all amendments to the trust provisions as well as revocation of the trust should be executed by a notary, by notarial deed;
- the trust should be registered in the public registers;
- at least one of the trustees has to be residing in Curaçao; and
- the trustee can be a beneficiary but not the sole beneficiary.
Use of foundations in estate planning
In 1998, a law entered into effect creating the private foundation. This is a legal entity and a type of foundation, with the benefit that the private foundation is allowed to make distributions of a non-charitable nature.
Types of entities
The Curaçao legal system recognises several entities that limit liability for their shareholders or participants, including the limited liability company (besloten vennootschap met beperkte aansprakelijkheid), which has been in existence for decades and the closed company with limited liability (naamloze vennootschap), which was created in 2001.
Taxation
Income tax system
Curaçao applies the worldwide income principle, but allows for the avoidance of double taxation, even where there is no treaty concluded.
Personal income tax rates
The personal income tax rates are progressive and go up to 46.50 per cent above USD73,746 in 2020 (schedule 2020): 9.75 per cent on income up to USD17,699; 15 per cent on the next USD5,900; 23 per cent on the next USD11,799; 30 per cent on the next USD14,749; 37.5 per cent on the next USD23,599; and 46.50 per cent beyond that.
Corporate income tax rates
The rate is fixed at 22 per cent in 2017 and subsequent years.
Capital gains tax
Capital gains are not part of the taxable income under the personal income tax rules. So selling your home with a gain is tax free. There is an exception for so-called substantial interest shares. If a private person owns at least 5 per cent of the issued shares in a corporation the capital gain on a sale is subject to income tax at a rate of 19.5 per cent.
Capital gains in a corporation are subject to tax at the standard rate of 22 per cent in 2017 and subsequent years, unless the corporation intends to replace the asset sold, in which case the corporation can form a reserve during four years. Gains on the sale of a participation are subject to the participation exemption. Gains or losses derived from a participation are exempt from profit tax. Holdings of at least 5 per cent or at least USD500,000 (ANG890,000) qualify as a participation for profit tax purposes.
Non-residents taxable on
-
Income from real property in Curaçao.
- Interest on debts secured through mortgages on real property in Curaçao.
- Income from work or an enterprise in Curaçao.
- In general, income from profit certificates, shares, bonds or debts in a company established in Curaçao, but only if the shareholder owns a substantial interest in such company and was a resident in Curaçao in the 10 years preceding the year in which the income is earned.
- In general, the sale proceeds of a substantial interest in a company established in Curaçao if the non-resident has been a resident in the 10 years preceding the year in which the sale proceed is earned.
-
Income from being a managing director or supervisory director of an entity established in Curaçao, even if the authority is limited to activities outside Curaçao.
- Income from Curaçao governmental paid offices for work performed outside Curaçao.
- Income from annuities originating from Curaçao.
Withholding tax rate (non-treaty)
No dividend withholding tax is applicable. Withholding tax on interest at a rate of 8.5 per cent. No withholding tax on royalties. Wage tax withholding on salaries at the rates of the personal income tax. No withholding on branch profit, but the obligation to file a tax return if there is a permanent establishment.
Withholding tax rate (treaty)
Within the Netherlands, under certain circumstances, no interest withholding tax is due since the right of taxation is granted to the resident state.
Taxation at death
At death there is, in principle, the notion of a fictitious transfer to the heirs, which could trigger income tax on a capital gain of a substantial interest, but it is possible to opt for a rollover. The same applies to the enterprise that is run in person by the deceased. Fines of the deceased are no longer due.
At death, Curaçao levies an inheritance tax that is charged on the net amount of the assets and debts acquired upon death or through bequest. The rates vary depending on the total value as well as the family relation with the deceased. There are five categories:
- The splouse or life partner and the children and (great) grandchildren.
- Parents and grandparents.
- Brothers and sisters.
- Children or grandchildren from brothers or sisters.
- All other persons.
The rates vary:
- In category one between 2 and 6 per cent.
- In category two between 3 and 9 per cent.
- In category three between 4 and 12 per cent.
- In category four between 6 and 18 per cent.
- In the last category between 8 and 24 per cent.
Exemptions are limited: the spouse or life partner ANG240,000 (USD134,831); the children, grandchildren or parents (in law) ANG80,000 (USD44,944) and, in other cases, ANG8,000 (USD4,494).
The foundation or trust that receives from a Curaçao resident must pay 25 per cent.
In Curaçao, once a person dies the public notary will prepare a statement of decease, which costs around ANG500 (USD281). Such a statement is needed to be able to get access to bank accounts, for example. Handling of the estate depends on the circumstances. If there is a last will it might contain the appointment of an executor who will undertake the steps to settle the estate. The fees depend on the rates of that person and the activities involved.
Other taxes
- Gift tax is levied at the same rates and categories as succession duties. Exemptions are limited: the spouse or life partner ANG20,000 (USD11,236); the children, grandchildren or parents (in law) ANG20,000 (USD11,236) and, in other cases, ANG8,000 (USD4,494). These exemptions are applicable on an annual basis. There are some exemptions such as gifts to charitable foundations or private foundations and trusts.
- There is a real estate tax that is levied annually on the value of the property. No other wealth tax is levied.
- Stamp duties are levied on the registration of documents.
- The Central Bank of Curaçao and Sint Maarten (the Central Bank) levies a 1 per cent foreign exchange duty from the merchant banks that charge this to the clients. It applies to money being transferred from the inland money sources to abroad. It is possible to have offshore bank accounts and that money is considered to be abroad and can be transferred abroad without the levy of the 1 per cent licence fee.
Profit tax regime
While Curaçao applies the worldwide income principle, income generated outside of Curaçao is generally exempt from profit tax. Provided that a holding of shares qualifies as a participation, income derived from the participation is not taxable for profit tax purposes. Additionally, the profit tax regime allows for Curaçao holding companies to enter into a fiscal unity with their Curaçao resident subsidiaries (profit tax is than levied as if all the entities in the fiscal unity became one single entity). The holding company becomes the taxpayer for profit tax purposes on behalf of all entities in the fiscal unity. The fiscal unity files a consolidated profit tax return. Special profit tax regimes are applicable for insurance companies, research and development developers, investment companies, companies established in the economic zones, shipping companies and airline companies.
Profit tax rates
The rate is fixed at 22 per cent in 2017 and subsequent years. Qualifying investment companies are subject to a profit tax rate of 0 per cent.
Tax treaties
Since 1964, all parts of the Netherlands (Aruba, Bonaire, Curaçao, Saba, Sint Eustatius, the Netherlands and Saint Martin) have concluded an arrangement to avoid double taxation and exchange information, the so-called BRK (Belastingregeling voor het Koninkrijk). Since October 2010 Bonaire, Saba and St Eustatius are special municipalities of the Netherlands and they have concluded their own arrangement to avoid double taxation. Since 1 January 2016, the BRK has been replaced by the BRNC (Belastingregeling Nederland-Curaçao). The BRNC is a new arrangement between the Netherlands and Curaçao to avoid double taxation and exchange of information. The BRK continues to apply between Curaçao and Aruba, and Curaçao and Saint Martin. In addition to this, a double taxation treaty exists with Norway.
Tax information exchange agreements (TIEAs)
Curaçao has signed 23 TIEAs (www.eoi-tax.org/jurisdictions/CW#agreements)
Residence and domicile
Special rules on becoming resident
The immigration law determines the admittance of persons.
Special rules on ceasing residence
NOT APPLICABLE
Domicile concept for gifts and inheritance
The gift and inheritance tax applies to residents of Curaçao that have their home in Curaçao and entities that have their place of management in Curaçao. All circumstances are decisive in concluding residency, such as being registered as a resident in the municipal register and owning a house in Curaçao.
Taxation of holdings by non-residents on death and of gifts
- Gifts: the gift of real property in Curaçao owned by non-residents triggers a transfer tax to be paid by the recipient of the gift. Since real estate can only be transferred through a public notary in Curaçao this tax will be levied. The tax rate is 8 per cent.
- Death: the 8 per cent transfer tax also applies when the transfer results from inheritance from a non-resident owner of real estate in Curaçao.
Reporting/auditing requirements
The recipient must file a tax return in which the receipt is reported.
Other relevant information
Asset protection laws
NO
Foreign currency restrictions
For non-residents who have a foreign currency exchange exemption, issued by the Central Bank, none.
Foreign ownership restrictions
NO
AML/due diligence and other requirements and regulatory procedures for advisors
Up-to-date rules on the detection and deterrence of money laundering and terrorist financing are in place, including know-your-client requirements. The National Ordinance on Reporting Unusual Transactions (P.B. 2010, no. 41 LvMOT) provides for reporting requirements.
Through the National Ordinance on the Supervision of Trust Service Providers (NG 2003, no. 114) provisions and guidelines, trust service providers are supervised by the Central Bank and require a licence.
Key resources for further information
Websites
Central Bank of Curaçao and St Maarten: www.centralbank.cw
STEP branches in Curaçao
There is one STEP branch in Curaçao, which forms part of STEP's Caribbean and Latin America region.
Firms in Curaçao
Find firms in Curaçao using the Firm Search: Search now
Members in Curaçao
Find STEP members in Curaçao using the Member Search: Search now