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Sead Dado Salkovic |
Existing tax relief with respect to corporate income tax (CIT) has introduced a delayed payment for the legal entities in Montenegro.
Accordingly, the rule adopted by the government stated that the ministry of finance may defer payments of tax and non-tax claims that belong to the state budget and approve the payments to be done in installments to capitalise on them for the purposes of regional development, reconstructing of the economic entities and for other purposes. Accordingly the accrued liability of legal entities in Montenegro may be delayed and can be paid in six equal monthly installments. Nevertheless, in the case where the tax debt is not paid within this period, the remaining portion of the tax debt arising from the CIT is due for the immediate payment.
However, the Montenegrin CIT law provides for that legal entities should submit a tax return, at latest within three months from the expiration of the tax period (the tax year), to the competent tax authority for the period for which the tax is calculated. Concurrently, during the same period, tax reported in tax return has to be paid.
A request for the postponed payment of legal entities' CIT is submitted to the tax authority office, in accordance with a companies' seat, within the term of the annual tax return is submitted. Many legal entities used the benefits of this tax relief, and reported their profits by March 31 as the deadline for the filling tax returns in Montenegro.
The decree on postponed payment of the CIT did not specify the period which it relates to. This should mean that this is not a temporary regulation, and it is applicable on all cases where CIT tax debts exist.
Finally, using this tax relief, legal entities shall only have benefits, their budget will not suffer significant burden in any circumstances and at the end legal entities will complete their general duty to pay CIT.
Sead Dado Salkovic (sead.salkovic@eurofast.eu)
Eurofast Global Podgorica Office/Montenegro
Tel: +382 20 228 490
Website: www.eurofast.eu
