Curaçao’s Regulations for Pensioners

There exists on the former Netherlands Antilles an attractive fiscal arrangement for those people who wish to settle there after their retirement. There are two different taxation systems which enjoy a relatively low rate.

Unless the income from foreign source is higher than Antillean Guilder or ANG 2,227,570 (around USD 1,238,896 / CAD 1,178,584 based on the rate of 2011) usually the first method of taxation is more advantageous.

10% rate for Foreign Sources of Income

As the pensioner (or any resident) is subject to regular Curacao taxation on his worldwide income to the extent the income qualifies as foreign source it is taxed at a rate of 10%.

Foreign source income includes:

  • Cash benefit from a life insurance that is paid by a company not residing in Curacao
  • Proceeds or gains from the alienation of shares in an old ‘offshore’ company
  • Proceeds or gains from the alienation of shares in a company which is active as a shipping or aviation company, irrespective where located
  • Dividend from a company not resident in Curacao
  • Periodical payments that are not being paid by somebody residing in Curacao
  • Capital gains realised in connection with shares that form a so called substantial interest in a company that is not resident in Curacao
  • Proceeds, such as interest, from bank accounts and claims, unless received on mortgages on Curacao real estate or received from residents of Curacao
  • Proceeds from profit sharing rights, other than as a shareholder, of a business not operated in Curacao
  • Proceeds from an enterprise, operating outside Curacao
  • Proceeds from an existing or former employment, or from other activities outside Curacao (e.g. a pension)
  • Proceeds from real estate situated outside Curacao

Income that does not qualify as foreign source (which would qualify as being progressively taxed):

  • Proceeds from claims to the account of a natural or legal person who is residing or established in Curacao or
  • has their registered offices in Curacao
  • Proceeds from an existing employment, (either as Employee, managing director or supervisory director) of an
  • entity that is established or has its registered offices in Curacao
  • Proceeds from claims, insured by means of mortgage, established on real estate in Curacao

Source: http://www.ap-executive.com/media/407820/curacao_regulation_for_pensioners.pdf