Montenegro Corporate Income Tax

Corporate income tax rates

Montenegro applies a progressive corporate profit tax with three brackets. Resident companies are taxed on worldwide profit; non-residents on Montenegrin-source income or PE profit.

• CIT bracket — profit up to €100,000 — 9% percent (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))
• CIT bracket — profit €100,000.01 to €1,500,000 — €9,000 + 12% on profit above €100,000 (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))
• CIT bracket — profit above €1,500,000 — €177,000 + 15% on profit above €1,500,000 (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))

Tax base and residence

The tax base is accounting profit adjusted for tax purposes under the Corporate Profit Tax Law.

• CIT tax base — Accounting profit per financial statements, adjusted for non-deductible/exempt items per the tax law (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))
• Resident company scope — Worldwide profit (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))
• Non-resident company scope — Montenegrin-source income or profit attributable to a Montenegrin permanent establishment (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))

Withholding tax (corporate)

A 15% withholding tax applies at the moment of payment to residents and non-residents on dividends, and to non-residents on a range of other income; double-tax treaties may reduce these rates.

• WHT on dividends / profit distributions — 15% (to residents and non-residents) percent (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))
• WHT on interest (to non-residents) — 15% percent (Montenegrin tax residents are exempt from tax on interest) (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))
• WHT on royalties / IP fees (to non-residents) — 15% percent (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))
• WHT on consulting/market research/audit fees and rental (to non-residents) — 15% percent (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))
• Treaty relief — A double-tax treaty may reduce or eliminate WHT where the non-resident proves treaty residency and beneficial ownership (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))

Filing and payment

The corporate tax year is the calendar year; the annual return and balancing payment fall at the end of March.

• CIT return filing deadline — End of March of the following year (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))
• CIT payment deadline — End of March of the following year (for the previous year) (Corporate Profit Tax Law (Zakon o porezu na dobit pravnih lica))
• Statute of limitations on assessment — 5 years from year-end when tax should have been assessed; absolute limit 10 years (General Tax Administration Law (Zakon o poreskoj administraciji))