Inheritance tax is levied on the market value of the inheritance received by beneficiaries. The beneficiary is liable to pay tax on the inheritance received. Debts and expenses are deductible from the taxable value.
Inheritance tax is levied on all immovable properties transferred by succession or as gifts. Other inheritances and gifts may be taxable if its market value exceeds the annual average salary in Macedonia for the year before.
The rate depends on the order of succession. Beneficiaries who are first degree relatives are not taxed. Those who are second degree relatives are taxed at 2% to 3%, and all others are taxed at 4% to 5% rate. The municipalities where the properties are located determine the exact applicable inheritance tax rate.