Greenland has a relatively simple tax system, based on a flat-rate taxation of labor income and certain capital income.

Greenland has a limited number of import duties but no VAT.

The Greenlandic tax is based on a net income principle, where the taxable income is calculated as a total net amount after deductions.

The net income principle means that all income is treated equally, regardless of whether the income comes from employment, self-employment, investment income or pensions, etc.

From an investing and legal liability principle the income is taxable when you receive the income, and all expenses can be deducted from the moment you are liable for the expense.

The net income system has several advantages, since you only calculate the taxable income once per fiscal year.

The net income principle is based on a global income principle, which means that income from foreign sources is included as taxable income.

With the global income principle a double taxation between Greenland and another country can occur. Greenland has entered a double taxation agreement with Denmark, the Faroe Islands, Iceland and Norway. The Greenlandic income tax law and the double taxation agreement combined can allow for a relaxation of this tax, as the country of residence and the source country allocate tax rights based on the type of income.

Additionally has Greenland entered into FATCA (The Foreign Account Tax Compliance Act), AEoI (Automatic Exchange of Information), MCAA (Multilateral Competent Authority Agreement) and 42 separate information exchange agreements (TIEA).