Paying Taxes in Montenegro

1. What is the corporate tax in Montenegro?

The flat corporate tax rate for a company that is registered in Montenegro is 9%, one of the lowest rates in Europe.

2. What is the VAT in Montenegro?

The standard VAT rate in Montenegro is 17%, with a reduced rate of 7% on several goods and services, such as medicines, textbooks, public transportation or food.  There is also a zero VAT rate for exported goods or fuel.

3. How can the VAT be refunded in Montenegro?

If you want to apply for a VAT refund in Montenegro, you have to submit a request to the Ministry of Finance, which is in charge with prescribing conditions for VAT refund applications.

4. What is the dividend tax in Montenegro?

If the dividends are not subject to a tax treaty that stipulates a reduced tax, the dividend tax is 9%, whether it is paid for residents or nonresidents.

5. Are there any incentives for foreign investors in Montenegro?

In order to establish a favorable investment climate for foreign investors, Montenegrin government set up several incentives.  A friendly tax system with a corporate tax rate of only 9% is the first thing that attracts investment. Moreover, one can apply for tax credits in order to obtain a reduced gross tax by 25%. There are also incentives for those who establish a company in an underdeveloped zone by being exempt from taxes for the first three years. If new employees are hired for more than two years, the investor benefits from added tax incentives.

6. Why do I need a local accountant for my business in Montenegro?

A local accountant will be much more efficient in solving accounting problems by having a strong knowledge of the Montenegrin tax system. Besides, local standards and requirements as far as the accounting reports are concerned can only be met by a person with experience in business in Montenegro.