What are the property transfer taxes in Montenegro?

For resale (second-hand) properties, Montenegro charges a progressive Real Estate Transfer Tax (RETT) on the buyer:  

• Up to €150,000 → 3%
• From €150,000.01 to €500,000 → €4,500 plus 5% on the amount above €150,000
• Over €500,000 → €22,000 plus 6% on the amount above €500,000  
• Note: There are no additional tax brackets above €1,000,000 - the 6% rate on amounts above €500,000 continues indefinitely for all higher-value properties.  

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The tax is assessed on the property's market value as determined by the Tax Administration, not only on the contract price. If they consider the declared price too low, they can reassess and impose tax on the higher valuation.  

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The buyer (acquirer) pays RETT. The notary files the tax declaration when the notarised sale contract is signed, and the buyer must pay the tax within the statutory deadline, commonly 15 days from signing.  

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Example Calculations:  

Scenario 1: New build from developer (€300,000)

• Purchase price: €300,000 (VAT already included)
• VAT (PDV): 21% = €52,066 (typically included in developer's advertised price)
• RETT: €0 (no RETT on first transfer from VAT-registered developer)
• Total tax component: €52,066 VAT (usually shown as inclusive in price)  

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Scenario 2: Resale property €120,000

• Purchase price: €120,000  
• RETT calculation: €120,000 × 3% = €3,600
• Total RETT payable: €3,600

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Scenario 3: Resale property €650,000 (showing stepped calculation)

• Purchase price: €650,000
• RETT calculation:  
  
  • First €150,000: €4,500 (fixed amount for this bracket)  
  • Next €350,000 (from €150,000 to €500,000): €17,500 (5% of €350,000)  
  • Remaining €150,000 (above €500,000): €9,000 (6% of €150,000) - Total RETT payable: €4,500 + €17,500 + €9,000 = €31,000  

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For newly built properties bought directly from a VAT-registered developer, VAT at 21% is normally charged instead of RETT on the first transfer. The developer charges VAT on the purchase price, and this is the buyer's primary tax obligation. VAT is typically included in the advertised price. Subsequent resales of that property will then be subject to RETT rather than VAT.