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Economy and Banking Sector of Montenegro

Withholding Tax

Withholding taxes are imposed at source of income and are often applied to dividends, interest, royalties, rent and similar payments. The rates of withholding tax are often reduced by double taxation agreements.

Withholding Tax Rates in Montenegro: 0.0 - 9.0%

Withholding tax rates applied on payments of interest and dividends in Montenegro are shown in Table 1.

Dividends Interest
Natural Persons (residents) 9.0 %0.0 %
Natural Persons (non-residents) 9.0 %9.0 %
Table 1. Withholding tax rates in Montenegro.

Double Taxation Agreements

Double Taxation Agreement (DTA) is an agreement between two or more countries for the avoidance of double taxation.

DTAs of Montenegro: 20 Signed Agreements

Montenegro signed DTAs which already came info force with the following jurisdictions:

BE Belgium
HR Croatia
CY Cyprus
CZ Czech Republic
DK Denmark
FI Finland
FR France
HU Hungary
IE Ireland
IT Italy
LV Latvia
MT Malta
NL Netherlands
PL Poland
RO Romania
SK Slovakia
SI Slovenia
SE Sweden
CH Switzerland
GB United Kingdom

Information Exchange

There are 3 ways for jusrisdictions to exchange information on tax matters:

  • spontaneously;
  • on request;
  • automatically.

Spontaneous exchange of information is provision of information that is forseeably relevant to another party without a request being previously sent.

Tax Information Exchange Agreements (TIEAs) enable exchange of information on request relating to a specific tax investigation, either criminal or civil.

Automatic information exchange allows jurisdictions to exchange information automatically, without having a specific tax investigation.

Automatic Exchange: No Commitment to Start

Montenegro didn't sign the automatic information exchange agreement and didn't indicate a timeline of the start of the automatic information exchange.

Automatic Excnange: 0 Bilateral Agreements to Receive Information

Montenegro has not singed any bilateral agreements to automatically receive information.

Automatic Excnange: 0 Bilateral Agreements to Send Information

Montenegro has not singed any bilateral agreements to automatically send information.

Further Information

FATCA

Foreign Account Tax Compliance Act (FATCA) which became law in the United States in March 2010, focuses on reporting made by foreign financial institutions about financial accounts held by US taxpayers or foreign entities in which US taxpayers hold a substantial ownership interest. The FATCA-reporting is facilitated by Intergovernmental Agreements (IGAs).

FATCA Status in Montenegro
IGA agreed on 30 June 2014, Model 1

Montenegro agreed in substance to use FATCA on 30 June 2014 (Intergovernmental Agreement Model 1): the text of the IGA has not been released and financial institutions operating in Montenegro are allowed to register on the FATCA website consistent with the treatment of having an IGA in effect provided that Montenegro continues to demonstrate firm resolve to sign the IGA as soon as possible.

Further Information