Why you should invest in Montenegro and why it is convenient to open an Ltd. in Montenegro?

The taxation system in Montenegro: find out more!

Natural person

Income tax for a natural person in Montenegro is 9% and has to be paid each month by both the employee and the employer. The tax is determined based on various factors, one of them are individual’s personal allowances. Citizens with permanent citizenship are required to pay taxes for the income earned within the country as well as the income earned abroad. Non-resident natural persons, however, are only required to pay the tax for the income earned in Montenegro.  Residents are all those residing in Montenegro continuously for at least 183 days throughout the year.

Legal person

Corporate income tax is applied to both legal persons with residence in Montenegro and companies with residence abroad. The withholding tax is not applied to the dividends from the shares of the companies acquired by a share (for the purpose of capitalizing on its business). The rate is proportional and unchangeable (for all legal entities) and it is of 9%. Furthermore, the legislation has established that the losses (of the companies at the end of the year) may be carried forward up to a maximum of 5 years following their occurrence. Opening a company in Montenegro is therefore convenient for Europe residents, not only in terms of convenient taxes but also because there are many deductions and incentives.

The tax system in Montenegro has many impositions and deductions, which vary according to the area (underdeveloped areas for example) and the situations that concern the different circumstances of each natural person. It is highly recommended to know more about taxes, since it can be very beneficial: for example, the value added tax has an ordinary rate of 17%, however, the law also provides, in cases strictly established within the law, rates reduced to 7% or 0%. Montenegro tends to favor the underdeveloped areas of the country, therefore, if you would like to open a company in Montenegro, you can benefit from these incentives too.

Would like to open an LTD in Montenegro? Write to us at info@taxofia.com!