Montenegro Sole Proprietor (Preduzetnik) — GPP-FL Annual Return

Establish the client's legal status (employee, sole proprietor preduzetnik, or both), confirm tax residency (183-day rule or centre-of-interests in Montenegro), and identify the municipality of business registration to set the correct prirez surtax rate — 15% for Podgorica and Cetinje, 13% for all other municipalities. Without confirmed residency the scope of taxable income (worldwide vs Montenegro-source) cannot be determined.

Obtain the full-year bank statement(s) from the client's Montenegrin business account (CKB, NLB, Erste, Hipotekarna, or UCB) and classify every transaction using the Montenegro transaction pattern library: business income (UPLATA, HONORAR, platform payouts), deductible expenses, Tier-2 items requiring further evidence, and exclusions (own-account transfers, VAT payments, loan repayments). If VAT-registered, strip the 21% PDV from gross receipts and gross costs to arrive at net income and net expenditure.

Resolve every Tier-2 item flagged in Phase 2 — home office apportionment (floor-area method), motor vehicle business-use percentage (requires mileage log), phone/internet split, and capital asset depreciation rates (which must be confirmed by the reviewer as statutory rates were not confirmed in research). Apply conservative defaults (0% deduction) for any item the client cannot substantiate with evidence. Confirm the EUR 68,765 annual PIO contribution ceiling is not breached.

Apply the annual progressive PIT bands to the net profit: 0% on the first EUR 8,400, 9% on EUR 8,400.01–12,000 (maximum EUR 324), 15% on income above EUR 12,000. Then compute the municipal surtax (prirez) on the PIT amount — 15% if Podgorica or Cetinje, 13% for all other municipalities. If the client also has employment income, salary is taxed on separate monthly bands and must not be blended with the self-employment annual computation. Compute total PIT + surtax liability for the year.

Compute mandatory social insurance contributions for the sole proprietor under the post-Europe-Now-2 structure (effective 1 October 2024): pension and disability insurance (PIO) at 10% and unemployment insurance at 0.5%, both on the contribution base. Verify whether the annual PIO contribution base ceiling (EUR 68,765 for 2024, indexed annually by the PIO Fund) is reached. For any period straddling a reform date, use the correct vintage and flag for reviewer confirmation if uncertain.

Complete and file the annual personal income tax return (GPP-FL) via the Montenegrin e-filing portal (eprijava.tax.gov.me) by the 30 April deadline. The return consolidates all income types (sole-proprietor profit, any employment income, rental, dividends, interest), the PIT and prirez liability, social contributions paid, and any advance payments made. Confirm the net tax payable or refund due, and generate the final signed working paper for the client's records.