How are rental incomes taxed in Montenegro?
Quick Answer:
Rental income is taxed at 15% on gross receipts if you're renting short-term (tourist rentals), or you can opt for taxation on net income after expenses for long-term rentals. You'll also pay municipal tourist tax (€1 per night per guest in high season, €0.50 in low season) and need to register your rental with the tax authorities and tourism directorate.
If you rent out property in Montenegro, rental income sourced in Montenegro is taxable there, regardless of your nationality.
For individuals:
- Personal rental income is generally taxed at 15% on the net taxable base
- Net taxable income can be calculated either using documented actual expenses or standard (forfait) cost deductions depending on the type of rental
For companies:
- Rental income is taxed as part of corporate profit under corporate income tax rules
Short-term tourist rentals also involve:
- Guest registration with local authorities
- Payment of tourist tax
- Compliance with local categorisation and hospitality rules
Property management fees:
- Long-term rental: NT Realty charges 10% of monthly rent for ongoing management; tenant placement typically costs 1 month's rent
- Short-term rental: Management fees typically 25-30% of rental income plus costs (cleaning, utilities, coordination)
Even if you are not a Montenegrin tax resident, you may have to declare this income in your home country as well, using any applicable double-taxation treaty to avoid being taxed twice.
Sources:
Law on Personal Income Tax; corporate income tax law; Tourism and hospitality regulations; NT Realty service rates
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