Taxes in Montenegro

Poreska uprava manages taxpayer registration, assessments, collection, electronic filing and tax audits. Ministarstvo finansija prepares tax legislation and international tax rules, Uprava carina handles customs, import value added tax and excise duties, and municipalities administer property tax and other local charges. Access to the system depends on factors such as residence, income source, permanent establishment, business activity, turnover and the location of property. Personal income tax applies to residents on worldwide income and to non-residents on income from Montenegro. A resident generally meets the 183-day test or has a home or centre of personal and economic interests in Montenegro, subject to a double-tax treaty tie-breaker. Personal income tax rates include 0% on employment income up to EUR 700, 9% from EUR 700.01 to EUR 1,000 and 15% above EUR 1,000. Annual self-employment income uses thresholds of EUR 8,400 and EUR 12,000. Other income categories, including dividends, interest, capital gains, royalties, certain internet gaming income and specified prizes, generally use a 15% rate, although gaming prizes from 2026 have separate 0%, 10% and 15% bands. Corporate income tax applies to resident companies and to non-residents earning Montenegro-source income or operating through a permanent establishment. Resident companies are generally identified by registration or effective management in Montenegro and are taxed on worldwide profit. The rate is 9% up to EUR 100,000 of taxable profit, followed by progressive amounts of EUR 9,000 plus 12% on the portion above EUR 100,000 up to EUR 1.5 million, and EUR 177,000 plus 15% on the portion above EUR 1.5 million. A global minimum tax framework applies to qualifying large international and domestic groups with consolidated revenue of at least EUR 750 million in at least two of the previous four years; its implementation and rate application should be checked against the current law because the 2026 amendment applies from 1 January 2027. PDV is Montenegro's value added tax. The standard rate is 21%, with reduced rates of 7% for defined essentials and services and 15% for accommodation in qualifying primary and complementary hospitality facilities from 1 January 2025. Exports and specified international transactions can have a 0% rate. A business generally registers when turnover exceeded EUR 30,000 in the previous 12 months or is expected to exceed that amount. The monthly PDV return, PR PDV-2, is filed electronically and paid by the 15th day of the following month. Import PDV is handled through Uprava carina. Businesses can claim input tax credit and request refunds through IRMS, the electronic tax administration system. Property tax is set by the municipality on the market value of land, buildings and residential or commercial units, commonly within a rate range of 0.25% to 1%. Municipal decisions and local conditions determine the concrete burden, which is commonly paid in two instalments. Real estate transfer tax is based on market value and uses rates of 3% up to EUR 150,000, 5% on the portion from EUR 150,000.01 to EUR 500,000 and 6% above EUR 500,000. The buyer generally self-assesses, declares and pays it within 15 days of the contract. A VAT distinction applies to certain construction land transactions from 2026. Withholding tax is generally 15% on dividends and profit shares and on specified payments to non-resident legal entities, including interest, royalties, intellectual property rights, rent, consulting, market research, audit and entertainment or sports programmes. A 30% rate can apply to defined low-tax or non-exchange territories. A double-tax treaty can reduce or remove domestic withholding tax when the recipient provides a residence certificate and proves beneficial ownership. The withholding tax report is generally due by the end of February. Businesses file corporate tax returns, financial statements and payment commonly by 31 March, while the annual personal income tax return, GPPFL, is generally due by 30 April. Employers and other payers withhold tax when income is paid and submit IOPPD reporting. Monthly PDV and related employment reporting generally follow the 15th day of the next month. Taxpayers need accurate books, supporting documents, registrations and change notifications. IRMS uses a qualified digital certificate for registration, returns, documents, analytical cards and refund requests, while e-fiscalization applies to relevant transactions. Taxpayers may request information and copies, appoint a representative, inspect files, attend an audit, seek reassessment and appeal a decision. Late filing or payment can create interest, penalties and enforcement measures. Montenegro's double-tax treaties can allocate taxing rights and provide relief from double taxation. A Montenegro resident can generally claim a foreign tax credit up to the Montenegro tax on the same income. The tax administration also exchanges information under international systems; qualifying financial institutions report under the Common Reporting Standard annually by 30 June for the previous year. Country-by-country reporting applies to qualifying groups above EUR 750 million, with the report generally due within 12 months after the tax year. Transfer-pricing documentation can be required for related-party transactions. New production companies in underdeveloped municipalities may qualify for a tax exemption for up to eight years, capped at EUR 200,000, if the strict statutory conditions are met. Related-party pricing and treaty relief require records that support the claimed treatment. Tax rates, filing dates and property rules can change, so the applicable law and the responsible authority's current instructions should be checked for the relevant tax period.