Income tax on rent, worked example, in Montenegro
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| Non-resident couple's rental income1 | ||||
| Monthly Rental Income2 | 1,500 | 6,000 | 12,000 | |
| Annual Rental Income | 18,000 | 72,000 | 144,000 | |
| Less: Expenses3 | 40% | 7,200 | 28,800 | 57,600 |
| = Taxable Income | 10,800 | 43,200 | 86,400 | |
| Income Tax 4 | ||||
| Flat rate | 9% | 972 | 3,888 | 7,776 |
| Annual Income Tax Due | 972 | 3,888 | 7,776 | |
| Tax Due as % of Gross Income | 5.40% | 5.40% | 5.40% | |
Notes
1 The property is jointly owned by husband and wife.
2 Exchange rate used: 1.00 EUR = 1.00 EUR
3 A standard deduction of 40% is allowed when calculating taxable income to account for income-generating expenses. Taxpayers may choose to deduct actual costs.
4 Rental income earned by nonresident individuals is taxed at a flat rate of 20%.
