Taxes in Grenada in 2026: what is taxed and what is not

The essentials in 30 seconds

In short—here is the essence of Grenada's taxes in 2026.

• Worldwide income is not taxed. Money earned outside Grenada is not touched by the island. This is the territorial principle: tax only on what is earned here.
• No capital gains tax. Sold shares or real estate at a profit—the state does not take a share.
• No inheritance tax and no wealth tax. You can transfer capital to your children without a separate tax.
• Local income is taxed. If you work or operate a business in Grenada itself—you pay income tax.
• There is VAT and property tax. These are ordinary indirect and property taxes; they have not gone away.

And most importantly, something often forgotten. Grenada citizenship is about mobility and a second passport. It is not an automatic ticket to a tax haven. Why—we will explain below.

What the territorial principle means in simple terms

There are two major models of income tax for individuals in the world.

The first is worldwide (as in Russia or the USA). A country levies tax on all your income, wherever you receive it. Salary at home, dividends in another country, profit from selling an apartment abroad—everything goes into the common pool.

The second is territorial. A country levies tax only on what is earned on its soil. Everything you received from outside does not concern it. This is exactly how Grenada is structured.

What does this mean in practice? Let us say you are a tax resident of Grenada. You have a business in Dubai and investments in Europe. Grenada will not levy tax on this money—it was not earned on the island. But if you opened a café in Grenada itself, the income from the café will be taxed according to local rules.

Does it sound profitable? For many — yes. But to use this, you need to actually become a tax resident of Grenada. And that's a separate story, which we'll return to.

What taxes don't exist in Grenada

This is the most pleasant part. A list of taxes that simply don't exist in Grenada for individuals.

• Tax on worldwide income — no. Foreign income of residents is not taxed.
• Capital gains tax — no. Sale of assets at a profit is not taxed.
• Inheritance and gift tax — no. Transfer of property to heirs occurs without this tax.
• Wealth tax — no. You don't need to pay for the mere fact of owning substantial capital.

For people who plan inheritances and manage capital long-term, this is a significant advantage. There's no need to factor in taxes when transferring a business to children or exiting an investment.

At the same time, Grenada is not a closed "black hole." The island participates in international tax information exchange (CRS). That is, it's a legitimate low-tax jurisdiction, not a way to hide something. It's important to understand this in advance.

Income tax: who and how much pays

Income tax in Grenada is paid on income earned on the island itself. For example, on salary from a local employer or on profit from a local business.

The rates in 2026 are simple — just two.

• First, a personal exemption applies — approximately XCD 36,000 per year (roughly 13,000 USD). This amount is not taxed at all.
• Income above the exemption and up to a certain threshold — 15%.
• Income above the threshold — 30%.

That is, a person with modest local income may not pay tax at all — their income fits within the exemption. But a high local salary falls under 30%.

The main thing to remember: these rates apply only to Grenadian income. If you live on the island but all your earnings come from abroad, Grenada's income tax generally doesn't affect you. Always verify exact exemption amounts and thresholds before filing — they are periodically indexed.

VAT and indirect taxes

VAT (Value Added Tax) is a tax you pay within the price of goods and services. Everyone who buys something on the island pays it, regardless of citizenship.

The basic VAT rate in Grenada in 2026 is 15%. But there are exceptions.

• 10% — for tourist accommodations (hotels, guest apartments).
• 0% — for basic products, medicines, and exported goods. There's virtually no tax on necessities.

For an investor, VAT is not the tax that strongly influences the citizenship decision. It's built into everyday expenses on the island, and everyone pays it equally. Just keep in mind that the price in a store or hotel already includes this percentage.

Real estate tax and purchase expenses

If you own real estate in Grenada, there's an annual tax on it. It's calculated from the market value of the property.

The rate depends on the type of use and typically stays within 0.5–0.8% per year of value. The percentages differ for vacant land and residential property. This is a moderate tax — it doesn't determine the island's attractiveness.

It's also worth knowing about one-time transaction expenses.

• Stamp duty upon sale — approximately 1%.
• Real estate transfer tax When a Grenadian citizen sells, they pay approximately 5% of the value; a foreigner pays approximately 15%.
• Alien Landholding License — approximately 10%. This fee is not paid by investors who purchase an approved property through the citizenship program.

Therefore, buying real estate specifically through the investment program is often more profitable than a regular street transaction — some fees are waived. Always verify exact percentages for the specific property.

Why "no tax on worldwide income" — this doesn't apply to everyone

This is where it gets most important. And this is where people are most often misled.

The phrase "Grenada does not tax worldwide income" is true. But it applies only to tax residents of Grenada. That is, to those who have actually relocated their center of life to the island.

If you simply obtained a Grenada passport but continue to live in your country - you remain a tax resident of your country. And you pay taxes according to its rules. The passport itself does not change your tax residency status.

This is a key misconception. People think: "I'll get a Grenada passport - and my taxes will disappear". No. Taxes are determined by where you actually live and how many days you spend there, not by the color of your passport cover.

To benefit from Grenada's territorial tax regime, you need to become its tax resident in reality - spend a sufficient number of days on the island and relocate your center of interests there. How this is calculated is covered in the next section.

Grenada: tax residency - how to become one

Tax residency is not a passport stamp, but a status that depends on your actual presence in the country.

In Grenada, the main criterion is 183 days on the island within a year. If you spend more than half the year there - you are a tax resident of Grenada.

There are also alternative tests that are sometimes applied.

• Approximately 122 days per year for three consecutive years.
• An average of approximately 91 days per year over four years.

The exact rules are administered by Grenada's tax authority (Inland Revenue Division). They determine tax status, not citizenship.

The conclusion is simple. If you want to benefit from Grenada's tax advantages - you need to relocate there and actually live there for a sufficient part of the year. Without this, you remain a tax resident of your previous country with all its rules. A passport provides mobility, but only relocation provides tax benefits.

Taxes for Russians: what you need to know

Specifically about Russian citizens - because there are especially many myths here.

Obtaining a Grenada passport does not cancel your tax obligations in Russia. While you are a tax resident of the Russian Federation, Russian rules apply.

• The 183-day rule. A tax resident of the Russian Federation is someone who spent 183 days or more in Russia over 12 months. This status determines how your income is taxed.
• CFC (controlled foreign companies). If you own a foreign company, you must notify and report it according to Russian rules.
• Currency legislation. Notifications about foreign accounts and reports on fund movements have not been cancelled.

So a Grenada passport is not a tax evasion scheme. It is a tool for mobility and a Plan B. A real change in tax status is only possible with an actual relocation and change of center of life - and this must be arranged strictly according to the law.

And also: Russia allows dual citizenship, but you must notify the Ministry of Internal Affairs (approximately within 60 days). This is a formality, but a mandatory one.

Table: what taxes exist in Grenada and what do not

Let's consolidate everything into one clear table. This makes it easier to see the full picture.

Key point: there are no personal "capital taxes," but standard taxes (income tax on local income, VAT, property tax) do apply. All figures should be verified before any transaction, as rates are periodically reviewed.

What is the real benefit for an investor

Let's be about the advantages—without exaggeration.

Estate planning. The absence of inheritance and gift taxes simplifies capital transfer to the next generation. This is significant for families with substantial assets.

Exit from investments without capital gains tax. If you become a Grenadian tax resident, selling assets at a profit is not subject to local capital gains tax.

Foreign income—not taxed. For island residents, Grenada does not tax income from abroad. For people with international income sources, this is a serious argument.

Mobility through a passport. Even without relocating, a Grenadian passport provides visa-free access to many countries and travel flexibility.

But we repeat the key point: tax benefits are only realized with genuine tax residency. A passport opens the door, but entering it means genuinely linking your life to the island or spending the required number of days there.

Typical mistakes and misconceptions

We'll collect the most common pitfalls so you can avoid them.

• "Passport = zero taxes." No. Taxes are determined by residency, not citizenship. You live at home—you pay taxes at home.
• "Grenada is a secret offshore haven where I won't be found." No. The island participates in tax information exchange (CRS). It is a transparent, low-tax jurisdiction, not a hideaway.
• "Since there's no tax on worldwide income, I don't need to report to my home country." No. As long as you are a resident of your country, its rules (including FATCA and currency regulations) apply in full.
• "I bought property—now I get all the benefits immediately." Not quite. Property gives you participation in the program, but the tax regime depends on your actual presence on the island.

Main conclusion. A Grenadian passport is a and powerful tool. But it is an instrument of mobility and planning, not a magic button to "zero out taxes." Tax decisions are always better made with a consultant for your specific situation.

How this relates to Grenada's citizenship program

Tax attractiveness is one reason investors look at Grenada. But it works in conjunction with the citizenship by investment program itself.

Briefly about the program. Grenada offers a second passport for investment—either a non-refundable contribution to a state fund or purchase of approved real estate with a holding period of several years. Processing usually takes a few months and is conducted remotely, without mandatory relocation.

Grenada's special feature—the treaty E-2 with the United States. A Grenadian citizen may apply for an E-2 investor visa to the United States. This is a visa, not a green card or U.S. citizenship—it's important to understand the difference .

If you are interested in specific amounts, family composition, and a step-by-step process, read separate materials: Grenadian citizenship by investment, buying real estate in Grenada and Grenadian passport and its opportunitiesRussian citizens will find useful an analysis of Grenadian citizenship for Russian Federation citizens.

Want to understand if Grenada suits your specific situation with taxes and capital? Contact us —we will review your case and tell you what is real and what is myth.

Expert comment: how not to be deceived by tax expectations

The tax topic around Caribbean passports is an area where it's easiest to overpromise. Therefore, it requires a sober approach and fact-checking for your specific circumstances.

Before making a decision, you should verify three things: where you actually spend your time, where your income comes from, and what tax rules apply in your current country. Only by combining these three factors can you understand whether Grenada will provide a tax benefit specifically for you—or whether it will remain primarily a mobility tool.