Company & Residence 2026: the €5,000 Tax Threshold for Renewal

The Law amending the Law on Foreigners was published on 9 January 2026 in the Official Gazette 3/2026 and entered into force on 17 January 2026. The new paragraph 4 of Article 70 says: a temporary residence and work permit of a foreigner who is an entrepreneur or the executive director of a company in which they are the sole owner or hold more than 51 % of the capital is renewed only if the conditions of Art. 43 are met and proof is provided that taxes and contributions of at least €5,000 per year have been paid. It applies to renewal applications filed from 17 Jan 2026 — i.e. for the first time to 2026 renewals covering business year 2025.

Affected: (1) foreign entrepreneurs (sole traders) and (2) executive directors of a d.o.o. who are the SOLE owner or hold MORE than 51 % of the capital. Not affected: EU/EEA and Swiss citizens (Art. 70 para. 8); hired directors without an ownership share — ordinary renewal under Art. 82, no threshold; co-owners with 51 % or less (the wording 'more than 51 %' leaves exactly 51 % unclear — check with your branch); employees on other grounds, digital nomads, family reunification. A first application (not a renewal) is not covered by para. 4, but MUP already asks for a business plan and proof of funds at first approval.

Scenario A ('strict'): only the dues on the director's own salary — income tax, surtax and contributions (employee 10.5 % + employer 0.7 %). Scenario B ('MUP interpretation'): before the parliamentary Committee on Economy on 17 Dec 2025 MUP stated that the SUM of all company payments of taxes and contributions counts, regardless of headcount — i.e. also other employees' payroll taxes/contributions, corporate income tax and VAT. Practice differs between MUP branches and the bylaw is not yet issued, so the only safe planning is scenario A. Our calculator shows both.

On a gross salary you pay: income tax 0 % up to €700, 9 % on €700–1,000, 15 % above €1,000 per month; surtax 13 % (Podgorica and Cetinje 15 %, Budva 10 %) on the tax; contributions 10 % pension + 0.5 % unemployment (employee) and 0.5 % + 0.2 % Labour Fund (employer). The director's salary alone yields €5,000 per year only at roughly €1,960–1,975 gross per month over all 12 months (Podgorica: €1,961.75; other municipalities: €1,973.92). At the minimum wage (≈ €670 gross) the total is only ≈ €900 per year. If the company was registered mid-year the threshold will almost certainly not be met by salary alone — count on scenario B or a higher salary in the remaining months. Note: a higher salary also means a higher net cost — at €2,000 gross the net is €1,613 and the state receives €427.55 per month.

A renewal application is filed with the MUP branch at the latest 30 days before the current permit expires. The €5,000 rule applies to all applications filed from 17 January 2026. Bylaws (which should specify what counts and which proof is attached) are due within 12 months of entry into force, i.e. by January 2027 — as of 16 Aug 2026 none have been published. Until then branches follow internal interpretation.

Along with the standard renewal documents (passport, proof of accommodation, health insurance, proof of funds, CRPS extract, employment contract / director appointment decision) you attach a CERTIFICATE of the Tax Administration on settled taxes and contributions, ideally showing the amounts paid by revenue type for the previous year. Request it at the competent Tax Administration branch or via the IRMS portal; it is useful to also attach the taxpayer's analytical account card and payment confirmations (bank statements).