• Profit-making companies and branches are obliged to pay CIT in Montenegro. The CIT rate is set at a progressive corporate tax rate:
  • up to EUR 100,000,00 - tax rate 9%;
  • from EUR 100,000,01 to EUR 1,500,000.00;
    ( EUR 9,000.00 +12% on the amount above EUR 100,000.01);
  • above EUR 1,500,000.01.
    ( EUR 177,000,00 +15% on the amount above EUR 1,500,000.01).

• Submission of the transfer pricing documentation is mandatory in Montenegro.
• Tax losses may be carried forward for a limited period of 5
• Statutory withholding tax rate is 15 %. Dividends, interests, royalties, rental income, capital gain, consulting services, market research services and audit services are subject to WHT.

• Montenegrin residents are required to pay tax on worldwide income, while non-residents are required to pay tax on Montenegrin sourced income, only.
• Income tax rate
  • Realized as personal income
    • 9% on the taxable income of EUR 700 to EUR 1,000;
    • 15% on taxable income above EUR 1,000.01;
• Additional income (other than employment income) should be reported in the annual tax return and is subject to rates: 9% tax rate on revenue from EUR 8,400 to EUR 12,000 and for revenue above EUR 12,000 tax rate is 15%.
• Employment income is subject to surtax whereas tax base is tax calculated on employment income, while tax rate is determined by the local self-government.
• Statutory withholding tax rate is 15%.
• Mandatory SSC are pension and disability insurances (10%) and unemployment insurances (1%).
• Revenues from business made online and gaming are subject to the allowance of 15% and 20% respectively for expenses incurred. The remainder is taxed at the rate the of 15%.

Full overview of income tax in Montenegro.

• Ownership rights over immovable property (buildings and land) of companies and individuals and rights of use of immovable property owned by the State are subject to property tax. The tax rate ranges from 0.25% to 1% of the property fair value.
• The acquisition of property rights on immovable property in Montenegro — including throughpurchase, exchange, inheritance, gift, contribution to or withdrawal of real estate from a commercial company — is subject to aprogressive property transfer tax, with the tax rates as follows:
  • up to EUR 150,000  - property transfer tax rate 3%;
  • from EUR 150,000,01 – EUR 4.500 plus 5% on the amount above EUR 150,000.01;
  • from EUR 500,000,01 – EUR 22.000 plus 6% on the amount above EUR 500,000.01.

• Standard VAT rate is set at 21%, while reduced rate is set at 7%.
• Place of supply of goods is principally the place where the item is located at the time disposal is transferred.
• Place of supply of services is the place where the recipient has its head office or a permanent establishment if the service recipient is registered for VAT (B2B rule).
• If, however, service is provided to non-VAT payer, the place of supply of such services is the place where the service provider belongs. There are special rules for place of supply for certain services such as: services related to real estate, transport services, telecommunication services, etc.

Read more about VAT in Montenergo.