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Montenegro: Tax debt payment plan introduced in Montenegro

28 February 2017

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Ivan Petrovic

Montenegro's Ministry of Finance and Tax Administration have created a new incentive in the tax system for companies with tax debt.

The programme will facilitate the payment of debt related to corporate income tax, personal income tax, social contributions, VAT and tax on real estate.

The relevant law, concluded on December 31 2016, provides the ability to pay tax debts in up to 60 instalments, with the requirement that the first payment amounts to 10% of the total debt. A very important aspect of the Act is that the dynamics of settling the tax debt (basically the number of monthly instalments) is proposed by the taxpayer.

The interest due for the debt and the costs of the procedure will be written-off for all taxable persons who will repay their debts in this manner. Subsequently, the reported liabilities will be taken in account as ongoing debt.

The Ministry of Finance will announce a public invitation in relation to the programme, available until March 31 2017. The deadline for submitting applications will be the 45th day after publishing the public invitation.

Applications need to include the taxpayer's name, registration number, address and the proposal of the payment method for the tax obligations. The tax administration will have a 60 day timeframe to respond to applications. Following acceptance, the first payment will need to be completed within 90 days.

A minimum threshold of tax debt is set for companies to be eligible for the instalments payment programme. Companies with up to five employees have a threshold of €100 in debt, while companies with the number of employees ranging from six to 50 must have a tax debt exceeding €500 in order to be considered. For larger companies with more than 50 employees, the threshold has been set at €1,000.

The tax administration has invited all taxpayers who have reported tax debt to respond to the public invitation and to use this opportunity to repay tax debts instalments, with the write-off of interest and litigation costs in connection with the tax claim.

Ivan Petrovic (
Eurofast Montenegro
Tel: +382 20 228 490

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