Rental Income Tax
https://eporezi.me/en/vodici/porez-na-zakup
Guide to taxing rental income of individuals in Montenegro: 15 % flat rate, standard costs 30/50/70 %, municipal surtax, who pays the tax (a corporate tenant withholds vs. GPP-FL self-assessment), non-resident obligations and Booking/Airbnb platform reporting.
Key facts
- 15 % tax on rent after standard costs (30/50/70 % depending on use).
- A corporate tenant withholds tax at once; individuals file GPP-FL by 30 April.
- Municipal surtax adds 13 % (15 % in Podgorica/Cetinje) on the tax amount.
- Non-resident landlords must appoint a tax proxy within 10 days of the lease.
Procedure
The lease should state the landlord, tenant, property, rent amount and term. Reporting the lease to the Tax Administration (and, for tourist accommodation, registering guests with the local tourist organisation for the sojourn tax) is the basis for tax assessment. An unreported lease is a misdemeanour.
Rental income is income from property (Art. 10 item 3 of the Personal Income Tax Law). The base is gross rent minus standard (normirani) costs under Art. 35: 30 % for ordinary letting without documenting costs, 50 % for letting rooms, apartments and houses to tourists with the sojourn tax paid, 70 % when the accommodation is let through a tourist agency/organisation under a contract of at least 60 days. Instead of standard costs the landlord may claim actual documented costs.
The €700 personal allowance does not apply to rental income — it applies only to employment income.
A flat 15 % rate applies to the base (income from property and property rights, in force since 1 January 2022, Off. Gazette 146/2021). The municipality adds a surtax on the tax amount: 15 % in Podgorica and Cetinje, 13 % elsewhere. Example: rent €500/month, standard costs 30 % → base €350 → tax €52.50 + 13 % surtax (€6.83) = €59.33 per month.
If the tenant is a legal entity or entrepreneur, it is the payer of the income and must calculate, withhold and pay the tax when paying the rent (and file the IOPPD return) — the individual landlord files nothing further for that income. If the tenant is a natural person (no withholding), the landlord reports the income in the annual GPP-FL return by 30 April of the following year and pays the tax then.
A non-resident landlord letting property in Montenegro without a withholding payer must appoint a tax representative (poreski punomoćnik) within 10 days of the tax obligation arising (Art. 26 of the Tax Administration Law) and report the income through them.
Amendments to the Tax Administration Law oblige digital platform operators (including non-resident ones such as Booking and Airbnb) to report to the Tax Administration data on landlords in Montenegro, amounts, number of transactions and commissions. The data are retained and matched against declared income — undeclared short-term rental income is increasingly easy to detect.
Rental income taxation (individuals)
| Parameter | Detail |
|---|---|
| Tax rate | 15 % flat (income from property — Art. 10 item 3) |
| Standard costs | 30 % ordinary letting / 50 % tourist accommodation with sojourn tax / 70 % via tourist agency ≥ 60 days (Art. 35) |
| Surtax | 13 % (15 % Podgorica and Cetinje) on the tax amount |
| Effective burden | ≈ 11.9 % of rent (30 % costs, 13 % surtax) / ≈ 8.5 % (50 %) / ≈ 5.1 % (70 %) |
| Tenant is a company/entrepreneur | Withholding tax on payment, IOPPD |
| Tenant is an individual / landlord non-resident | GPP-FL by 30 April; non-resident appoints a tax representative within 10 days |
Additional notes
If the landlord is a VAT payer (turnover above €30,000), VAT is also charged on rent of business premises.
Sale of the property is taxed separately — 15 % capital gain (see the real-estate transfer tax guide).
Non-residents: double-tax treaties normally give the taxing right to the state where the property is located — tax paid in Montenegro is generally credited in the state of residence.
Required Documents
- Lease agreement (reported to the Tax Administration)
- IOPPD return of the payer (when the tenant is a legal entity)
- GPP-FL form (when the tenant does not withhold)
- Rent payment records / platform statements
- Categorisation decision and sojourn-tax proof (tourist accommodation)
Legal Basis
Competent Institutions
- Tax Administration of Montenegro
Lease reporting, IOPPD/GPP-FL, tax collection
- Local tourist organisation
Guest registration and sojourn tax (tourist accommodation)
FAQ
What is the tax rate on renting out a flat in Montenegro?+
15 % on the base (rent less 30 % standard costs, or 50 %/70 % for tourist accommodation), plus a 13 % surtax (15 % in Podgorica and Cetinje) on the tax amount. Effectively about 11.9 % of gross rent for an ordinary lease.
Do I have to file anything if I rent my flat to a company?+
Not for that income — the corporate tenant is the payer and must withhold and pay the tax when paying rent (withholding tax, IOPPD). You just keep the lease and proof of payment.
I rent to an individual — when do I pay the tax?+
You report the income in the annual GPP-FL return by 30 April of the following year and pay then. If you are a non-resident, within 10 days of the lease starting you appoint a tax representative who files on your behalf.
Does the Tax Administration see my Booking and Airbnb income?+
Yes — amendments to the Tax Administration Law oblige platform operators to report data on landlords in Montenegro, amounts and number of transactions. Undeclared income is a misdemeanour with tax and interest assessed.
Related guides
Income Tax in Montenegro
Rates 0/9/15% + municipal surtax 10-15%, €700 deduction, 10.5% contributions
Annual Property Tax
Annual tax for owners, rates 0.25–1 % (secondary residence up to 1.5 %), 20–50 % relief, deadlines 30 June and 31 October
Annual Personal Tax Return (GPP-FL)
Annual income tax, GPP-FL form, April 30 deadline, all income sources