Income tax in Montenegro 2026

Employment income runs monthly through three bands: 0% up to EUR 700, 9% to EUR 1,000, and 15% beyond — the annual equivalents are EUR 8,400 and 12,000, and entrepreneurs use the same annual scale.

Municipalities add a surtax of 13-15% of the tax itself (15% in Podgorica and Cetinje), so the true top rate is about 17.25%.

At a glance

top rate: 15% above EUR 1,000/month (+ municipal surtax on the tax)
entry band: 0% up to EUR 700/month
tax year basis: Calendar year
filing deadline: 30 April; withheld income needs no return
residency basis: Worldwide; resident via 183 days, a settled home or your life's centre in Montenegro
regime flag: 8-year exemption (cap EUR 200,000) for new businesses in less developed regions

Rates

Employment income — monthly scale (2026)

Monthly gross salary (EUR)	Rate
0 – 700	0%
700.01 – 1,000	9%
Over 1,000	15%

Marginal rates apply within each band.

Business and professional income — annual scale (2026)

Annual taxable income (EUR)	Rate
0 – 8,400	0%
8,401 – 12,000	9%
Over 12,000	15%

Marginal rates apply within each band.

Thresholds & allowances

No personal allowancesThe 0% band does the work
No deductions exist for mortgage interest, insurance, education or medical costs
Lump-sum regimeTurnover up to EUR 30,000
Fixed annual bundles of roughly EUR 413-3,984 covering tax and contributions, by trade group; lawyers, consultants, retailers and similar professions excluded
Less-developed-region start-ups8 years exempt, cap EUR 200,000
For qualifying new businesses
Tourist rentals50-70% lump-sum deduction
70% for agency-contracted lets achieving 60+ occupancy days a year

Surcharges

Municipal surtax13-15% of the income tax dueover All income tax; 15% in Podgorica and Cetinje, lower elsewhere

Residency

Residency trigger

You are resident with 183 days in the year, a habitual abode or your centre of vital interests in Montenegro — and posted workers sent abroad by Montenegrin employers stay resident. Residents owe tax on worldwide income.

Non-resident treatment

Non-residents pay only on Montenegrin-source income, under the same rates, with 15% withholding on dividends, interest, royalties and rents paid by local entities.

Notes

Employers withhold monthly; income the payer could not withhold on — foreign income above all — must be self-declared and paid within 5 days of receipt.
The annual return (30 April) is only for income that escaped final withholding; entrepreneurs pay monthly advances of one-twelfth of last year's tax.
Spouses are always taxed separately.
Business losses carry forward 5 years; there is no carry-back.
Old-age pensions, scholarships (within limits), redundancy pay and life-insurance income are exempt.

FAQ

What is the income tax rate in Montenegro?

0% on the first EUR 700 of monthly salary, 9% to EUR 1,000 and 15% above — plus a municipal surtax of 13-15% of the tax, giving a true top rate near 17.25%.

Does Montenegro tax worldwide income?

Residents, yes — foreign salaries, dividends, interest and gains are fully taxable, and must be self-declared within 5 days of receipt when no local payer withholds.

Who files a tax return in Montenegro?

Only people with income not settled by final withholding — the deadline is 30 April; a pure salary earner files nothing.

Figures: tax year 2026, compiled from public sources. Not tax advice.

See income tax in other countries

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