Guide to Property Taxes in Montenegro
Tax Rate on Rental Income |
|||
| Monthly Income | €1,500 | €6,000 | €12,000 |
| Tax Rate | 15% | 15% | 15% |
Nonresidents are taxed only on their income derived from sources in Montenegro. Married couples are taxed separately.
Income Tax
Income tax is levied on the following:
- Employment income
- Business and professional income
- Investment income (dividends, interest, and royalties)
- Income from immovable property
All forms of income, unless taxed at source, are generally aggregated and taxed at a flat rate of 15%.
Rental Income
Income from leasing out real estate property is included in aggregated taxable income and taxed at a flat rate of 15%. Costs can be deducted up to 30%.
Capital Gains
Capital gains realized from the sale of real property in Montenegro are taxed at a flat rate of 15%. Taxable capital gains are calculated by deducting the following from the selling price: acquisition costs and related expenses, and improvement costs.
Corporate Taxation
Income Tax
Income and capital gains earned by companies are taxed at a rate from 9.00% to 15%. Income-generating expenses and operating expenses are deductible when computing the taxable income.
Buying and Selling Costs and Taxes
| Cost Component | Percentage of Property Value | Who Pays? |
| Property Transfer Tax | 3.00% | Buyer |
| Agent Fee (Buyer) | N/A | Buyer |
| Agent Fee (Seller) | 3.00% - 5.00% | Seller |
| Legal Fees | 1.00% | Buyer |
| Notary Fees | 0.01% | Buyer |
| Roundtrip Transaction Cost | 7.01% - 9.01% | Buyer & Seller |
| Source: Global Property Guide, KPMG | ||
Property Holding Tax
Real Estate Tax
A property tax is levied on real estate property in Montenegro. The owner of the property, or the individual with right to use the property, is liable to pay this tax. The tax is levied on the market value of the property at rates ranging from 0.25% to 1.00%.