Main rate: 15%
Resident companies are taxed on their worldwide income; non-resident companies are taxed only on Macedonian-source income. A company is resident if it is established under the law of Macedonia or if it has its legal seat there. The corporate tax rate is 15%. Dividends paid between resident companies are not taxed.
Progressive rates to 24%
Resident individuals are subject to tax on their worldwide income; non-residents are taxed only on Macedonian-source income. An individual who has a permanent dwelling available in Macedonia, or who is present for 183 days in the calendar year, is resident in Macedonia. Tax is charged on total income at progressive rates up to 24%. Dividends received from resident companies are reduced by 50% and included in taxable income. A 50% tax reduction is available to foreign experts working in Macedonia.
Company gains generally taxed as income
Capital gains of companies are taxed as income. However, in the case of gains on the sale of equipment or immovable property, only 70% of the gain is included in income. Gains by individuals on the sale of securities and immovable property are reduced by 70% and taxed at 15%. In certain circumstances, gains derived by individuals on the sale of immovable property are exempt.
VAT standard rate: 18%; Lower rate: 5%
Value-added tax (VAT) applies to most transactions at the standard rate of 18%. A reduced 5% rate applies to food, water, books and newspapers. Exports are zero-rated. Exemptions include the supply and renting of dwellings, banking and financial services, insurance, health and education.
Registration is compulsory for businesses with taxable annual turnover above MKD 1.3m, but voluntary registration is possible below this limit.
Tax Administration and Compliance
Tax year: Calendar year
Companies must make monthly advance tax payments based on the profits of the previous year. A tax return must be filed by February 28th following the tax year, and any final tax due must be paid within one month of the due date for the return.
Employment income of individuals is subject to deduction of tax at source, creditable against the final tax liability. An individual tax return is due by March 15th following the tax year, and an assessment is raised by April 30th to collect final tax payable. Some income of individuals, such as certain interest and agricultural income, is taxed by final withholding.
Additional Tax Information
Dividends 0% (provided income out of which dividends are paid has been subject to tax), Interest 10% and Royalties 15%. The rates may be reduced under an applicable tax treaty.
Macedonia has concluded several tax treaties, and some treaties of the former Yugoslavia still apply.
Taxable, with a 50% reduction for individuals. Dividends paid between resident companies are exempt.
There is transfer-pricing legislation but no anti-tax-haven (CFC) rules.
Consolidation is possible for resident 90%-owed groups.
Environmental protection; foreign investment; free-trade zones; modern technology; newly established companies.
Customs duties, Inheritance and gift tax, Property tax, Transfer tax on real estate and rights.