Kosovo - Nimrod Yaron Albania

Strategic Investments in Kosovo

BananaBlitz — Sun, 24 Nov 2024 17:34:06 +0000

Kosovo is actively promoting itself as an attractive location for strategic investments to encourage economic and social development. The government has worked actively to promote projects that will lead to economic growth, employment, innovation, and hence an increase in citizens’ quality of life. These priority sectors consist of such areas as energy, infrastructure, manufacturing, health, and others. Using incentives and straightforward procedures, Kosovo aims to attract domestic and foreign investors to drive its growth.

Encouraging Strategic Investments for Kosovo’s Economic and Social Growth

The status of a strategic investor or strategic investment project in Kosovo can be obtained by projects that meet criteria and procedures defined by law. This status is dedicated to projects in priority sectors of economic and social development, which contribute to economic growth, job creation, the implementation of new technologies, the improvement of Kosovo’s economic competitiveness, the increase of exports, the reduction of trade deficits, and the overall improvement of citizens’ well-being and living conditions. The included sectors are energy, infrastructure and mining, transport and telecommunications, tourism, manufacturing, agriculture and the food industry, healthcare, industrial and technological parks, as well as wastewater and waste management. In this way, this status aims to encourage projects with significant positive impacts on Kosovo’s economy and society.

Process for Applying and Engaging in Strategic Investment Projects in Kosovo

Investors, who may be foreign, domestic, or public authorities, can apply for strategic investor status by submitting a written request to the Investment Agency. The Government of Kosovo may also invite investors for strategic projects through public tenders or engage in direct negotiations when permitted by international agreements. Priority projects are drafted by the Government based on developmental interests and are published to be implemented by strategic investors. Decisions and calls for investments are published on the Government’s official website to ensure transparency.

Tax Benefits and Exemptions for Businesses in Kosovo

In Kosovo, dividends received by both residents and non-residents are not taxed. Businesses that purchase new heavy machinery can get a one-time 10% tax deduction when the machinery is first used in Kosovo, though they cannot use this if they already benefit from other tax breaks. Companies that sponsor sports can receive a tax credit of up to 30%, and those sponsoring youth or cultural activities can get a 20% tax deduction. Additionally, VAT is exempt from the import of manufacturing equipment and raw materials. Raw materials produced in Kosovo are also temporarily VAT-exempt until 2028. Businesses that earn income from outside Kosovo and pay tax abroad can receive a tax credit for those foreign taxes, up to the Kosovo tax rate. In addition, a government-affiliated website has been established to guide interested parties on how to establish a business in Kosovo, simplify the employment regulations, and navigate the strategic investment framework.

To read more about tax incentives in Kosovo, click here.

Why Invest in Kosovo?

Kosovo offers numerous opportunities for investment across various sectors. Its economy has shown strong economic performance in terms of GDP growth, thanks to export growth and private consumption. As energy production and some degree of stressed consideration towards alternative energy production increase, it provides an investment opportunity, especially in power plants and energy storage facilities. Mining remains important in Kosovo since Kosovo still possesses large quantities of critical minerals, such as nickel and manganese, but exploitation is still limited, both because of the inadequacy of being able to carry out a rapid review of the exploration licenses. The telecommunication and IT sector is in an expansion phase and Kosovo is a regional hub of IT-enabled activity. The healthcare sector, strength of quality care and infrastructure, represents a cash-rich business opportunity for private sector investments. Waste management and recycling are still on the road to maturity, and these can evolve even further by the EU policy measures addressed to Kosovo. Along with the economic development, increasingly sophisticated specialized services (e.g., legal service, commercial service, service design service) are in demand. Each of these impacts, along with the pro-West orientation of Kosovo’s population and the stability of its economy makes Kosovo attractive from the point of view of investing.

To read more about Kosovo, click here.

If you are interested in investing in Kosovo, it is advisable to consult with a professional on investment opportunities that best suit your needs. Our firm specializes in international taxation, and our team is ready to assist with related matters. We can connect you with top professionals to support your business activities in Montenegro if needed. Please feel free to contact us.

הפוסט Strategic Investments in Kosovo הופיע לראשונה ב-Nimrod Yaron Albania.

Real Estate in Kosovo

BananaBlitz — Tue, 16 Jul 2024 15:28:22 +0000

Kosovo has undergone positive developments in many sectors, with a special focus on the real estate industry. This article aims to explain various property taxes in Kosovo, investment incentives, and many other important information which will support individuals or businesses looking to invest in Kosovo.

Real Estate Investment in Kosovo

The economic growth in Kosovo is leading to an increased demand for residential properties, particularly in urban areas where prices are constantly rising, causing significant changes in the real estate market. Developers are meeting this demand by building commercial structures and integrating eco-friendly technologies in their projects.

Kosovo’s improved infrastructure is attracting foreign investors, while the market is also adopting digitalization, which is making property transactions more transparent and accessible through online platforms.

Real Estate Taxation

VAT is not applied to land and residential areas in Kosovo, but properties are taxed based on the property’s value and location, based on the” The Immovable Property” tax law. Effective as of August 6^th 2023, the property tax law has established a progressive tax system.

In Pristina, the property taxes range from 0.1% to 1% based on the property’s value. The tax value is calculated in Euro per square meter, taking into account the property’s location and type. Also, the cost for transferring a property in Kosovo is €150 per unit, defined as 100 square meters of residential or commercial building space, or 1 hectare of land, with the fee being determined at the municipal level.

The Eligibility of Foreign Citizens to Acquire Real Estate in Kosovo

On January 21, 2022, the Assembly of the Republic of Kosovo enacted a law regulating foreign citizens’ property rights. This legislation provides a structure for foreign individuals and organizations’ property rights to be created, transferred, protected, limited, or retained. Foreigners can buy property in Kosovo; however, they cannot possess agricultural land.

Foreign legal and natural individuals can obtain property rights through legal agreements, inheritance, court rulings at the state level, or other legal reasons. Individuals and legal entities from EU member states enjoy the same property rights as citizens of Kosovo.

Foreigners are not permitted to own public property, which includes natural resources, public goods, agricultural land, forests, and culturally significant property within designated zones. However, there are expectations that allow foreigners to own agricultural, forest, and forestry holdings under 5000 m² if the purpose is to construct a residential building. Long-term leasing, concession, and other agreements over limited properties are also acceptable under the same conditions as those for national individuals.

High Areas for Real Estate Investment and Prices in Kosovo

Real estate prices in Kosovo have increased significantly since the beginning of 2023, owing to favorable lending conditions, policies implemented by the State Agency of Real Estate (APN), and government housing subsidies. In central urban areas, the price of a flat is around €1,460 per square meter, while in less central areas, it drops to around €833 per square meter. Rental prices in city centers range from €295 to €354 per month, while in suburbs they can be as low as €218 or as high as €354 per month. Prices vary depending on location and property type, highlighting the market’s instability.

Pristina, the capital of Kosovo, plays an important role in the country’s real estate market as it attracts both local and international investors due to is many public administration offices, government institutions, and major businesses, particularly in the commercial and residential areas.

In the southwest, the culturally vibrant city of Prizren offers affordable traditional and modern apartments that are appealing to investors who are looking for cheaper options. Smaller cities such as Gjakova and Gjilan are developing real estate markets that feature inexpensive homes. Gjakova is famous for its architecture and beautiful natural surroundings, while Gjilan offers numerous business and residential possibilities.

Furthermore, Brezovica, located just 80 km south of Pristina and home to a ski center, presents an attractive investment option due to its popularity among tourists in the winter.

Prospective real estate investors should understand the legal and financial processes required. To effectively deal with these complexities, it is recommended that you seek advice from tax and legal experts. Our firm specializes in international taxation, and our team is ready to assist with any related matters. If needed, we can connect you with top professionals to support your business activities in Kosovo. Please feel free to contact us.

הפוסט Real Estate in Kosovo הופיע לראשונה ב-Nimrod Yaron Albania.

Opening a Bank Account in Kosovo

BananaBlitz — Tue, 16 Jul 2024 14:59:41 +0000

Kosovo, despite not being a member of the European Central Bank, uniquely adopts the euro as its official currency. The country’s banking sector is well-regulated by the independent Central Bank of Kosovo, and aligns with international standards. This article provides a general overview of the Bank sector in Kosovo, and as well includes information on the procedures on how to open a Bank account.

Banking Service in Kosovo

Kosovo has successfully implemented the Interbank Payment System, also referred to as the automated transfer system. This comprehensive system efficiently processes various payments, including high-value, retail, priority, individual, Direct Debit, and Securities. The Interbank payment system platform serves to both small and large domestic transactions.

Kosovo’s banking system aligns with the highest international standards for payment systems, integrating modern technology and best practices. This commitment positions Kosovo as one of the innovative nations to embrace and implement these elevated standards.

Types of Bank Accounts in Kosovo

Kosovo offers various types of bank accounts based on individual or business needs, such as:

Personal account
Business Account
Saving Account
Student’s account
Flexi Deposit Account – This account is for depositing money with flexible interest benefits.
Time Deposit Account – Designed for depositing funds for a fixed term, as agreed with the bank.

Banks Operating in Kosovo

Currently, 12 (twelve) banks are operating in the banking system of Kosovo. They provide different services, for example, bank accounts, payments, online banking, loans and letter of credit. It is necessary to understand that various banks might have unique rules for creating an account. So, when choosing a bank for your account in Kosovo, remember important things like being easy to reach, services they provide, costs and how helpful they are with customers.

Opening a Personal Bank Account in Kosovo

To apply for a bank account, you will typically need to fill out a form or application and provide essential documents such as an identification document, a recent utility bill for address verification, and proof of address or residence. If the bank approves your application, you will be asked to sign a contract outlining the terms of use for your account. It is important to read and fully understand the contract, as it details the rights and responsibilities as an account holder.

Opening a Business Bank Account in Kosovo

The procedure of signing up a business account in Kosovo is more complex as compared to personal accounts. Banks normally require further documentation to promote compliance and well-organized record keeping. The standard conditions for opening a business account are presentation of Business Registration Certificate and Kosovo Business Registration Agency, copies of passport(s) of director or directors.

Foreign business organizations setting up operations in Kosovo must best sign an agreement by the branch. Integral parts of incorporation documents are their agreement and charters for Limited Liability Companies, which must be submitted by them; Joint Stock companies need to submit those as part of due diligence requirements.

Our firm specializes in international taxation, and our team is ready to assist with any related matters. If needed, we can connect you with top professionals to support your business activities in Kosovo. Please feel free to contact us.

הפוסט Opening a Bank Account in Kosovo הופיע לראשונה ב-Nimrod Yaron Albania.

Incentive Tax Laws in Kosovo

BananaBlitz — Tue, 04 Jun 2024 13:35:46 +0000

Kosovo has created a welcoming environment for businesses through its strategic tax incentives. At the heart of these efforts, Kosovo has established a corporate income tax rate of 10%, making it an attractive location for both local and global businesses. This competitive tax rate is a key part of a broader strategy to draw in investment and stimulate economic development throughout the country. In this article, we will explore in detail tax incentives and their significant impact on the business-friendly climate in Kosovo.

Tax Exemption Incentives

A standout aspect of Kosovo’s tax policy is the exemption from dividend taxation, extending to both domestic and foreign investors. This incentive ensures that returns on investment remain high by eliminating extra tax charges on profit distribution, showcasing Kosovo’s commitment to encourage a profitable investment environment.

In an effort to strengthen its manufacturing sector, Kosovo has implemented VAT exemptions for the import of essential production assets and materials. This initiative, together with a temporary VAT relief for locally produced raw materials until 2028, reflects the government’s strategic focus on increasing domestic production and economic independence.

Enhanced Deductions for Capital Investments

To boost economic growth further, Kosovo encourages capital investments by offering an extra tax deduction on the purchase of new heavy machinery. This incentive allows for an additional one-time deduction, promoting the modernization of infrastructure and equipment crucial for development. However, it is worth mentioning that this benefit is reserved for businesses not already benefiting from other tax incentives.

Support for Social Contribution

Kosovo also supports investments in social areas, offering tax credits for sponsorships in sports, youth, and cultural initiatives. This policy shows Kosovo’s commitment to improving the economic environment and gives businesses the benefits from reduced tax liabilities.

Foreign Tax Credit

For companies with international operations, Kosovo’s introduction of a foreign tax credit minimizes the financial impact of double taxation, ensuring that businesses can offset taxes paid abroad against their obligations in Kosovo. This approach facilitates a more balanced and fair tax system for Kosovo-based entities engaged in worldwide commerce.

Kosovo’s arrangement of tax incentives illustrates a forward-looking approach to economic enhancement and investment attraction. Through offering competitive tax rates, encouraging capital investments, and supporting social contributions, alongside promoting manufacturing and ensuring fair international tax treatment, Kosovo is building the foundations for a thriving business environment.

If you are considering the investing in Kosovo, consulting with experts is essential. Nimrod Albania, specializes in offering professional guidance and support in the area of international taxation. For an initial consultation, we invite you to contact us through the provided link.

הפוסט Incentive Tax Laws in Kosovo הופיע לראשונה ב-Nimrod Yaron Albania.

Personal Income Tax in Kosovo

BananaBlitz — Tue, 04 Jun 2024 13:32:45 +0000

Despite facing challenges throughout its history, Kosovo has undergone significant transformations in its social and economic structures. The tax system in Kosovo is designed to be straightforward, aiming to cover a broad tax base and offer low taxes that attract foreign investors seeking tax advantages. This article aims to provide an overview of Kosovo’s income tax system, offering valuable information for anyone interested in moving to or investing in Kosovo.

Residency for tax purposes in Kosovo

For tax purposes, a person is determined as a resident if they primarily live in Kosovo temporarily or regularly, spend at least 183 days there within a tax year, or have significant personal, financial, or social connections in Kosovo.

Income Determination

In Kosovo, personal income tax applies to several types of income, such as wages, rental income, earnings from intangible assets, specific interest types (like those from loans, savings accounts, and bonds), replacement income, capital gains, lottery winnings, and pensions. Employment income includes not just wages but also bonuses, per-diems, insurance premiums, debt forgiveness, payment of personal expenses by the employer, and benefits in kind over a certain threshold.

Equity compensation, or any additional compensation provided by an employer, falls under personal income tax rates. Business income from self-employment and income from capital gains, such as from selling real estate or securities, are taxed according to personal income tax rates. However, dividend income is exempt from the personal income tax rate.

Interest income is taxable except for interests from specific sources like the Kosovo Pension Savings Trust, other defined pension funds, and financial instruments issued or guaranteed by Kosovo’s Public Authority.

Rental income from both real estate and equipment is taxable, and if the rental activities form part of economic activities, they are treated as business income. Certain types of income are exempt from the personal income tax, including wages of foreign staff of diplomatic missions and international organizations, wages of persons with disabilities, certain compensations, inherited assets, and educational expenses covered by employers.

Tax Rates for Personal Income in Kosovo

In Kosovo, personal income tax is levied on gross income using progressive rates that vary from 0% to 10%. Incomes up to 960 euros per year are not taxed, reflecting a 0% rate. For annual earnings between 960 euros and 3,000 euros, the tax rate is set at 4%.

Salaries falling within the range of 3,000 euros to 5,400 euros per year are taxed at 8%. Any income exceeding 5,400 euros per year is subjected to the highest tax rate of 10%. This progressive tax structure is designed to tax individuals based on their ability to pay, with higher-income earners contributing a larger percentage of their income in taxes.

For self-employed taxpayers, those earning over €50,000 or voluntarily opting for real income taxation face the same rates specified earlier, while those with annual gross income of €50,000 or less are taxed at 3% or 9%, depending on the nature of their activities. Additionally, these self-employed individuals are required to pay Pension Contributions.

Employee wages are taxed by the primary employer at rates of 0%, 4%, 8%, and 10%, and by the secondary employer at a fixed rate of 10%. Kosovo citizens, whether employees or employers, must contribute 5% of their gross income to Pension Contributions. Both the primary and secondary employers of a Kosovo citizen employee also contribute 5% each on the gross wage towards pension contributions.

Deductions

In Kosovo’s tax framework, taxpayers are allowed to deduct charitable contributions from their taxable income. These contributions can support a variety of causes including humanitarian, health, and education, religious, scientific, cultural, environmental protection, and sports activities, as recognized by the personal income tax law. Such deductions are permitted up to a maximum of 10% of the taxable income before the deduction of these contributions.

An additional deduction of 10% may be available for certain activities as specified by other laws related to sponsorships. To claim a deduction for charitable contributions, taxpayers must provide receipts from the beneficiaries that detail the purpose, amount, and timing of the donations. However, this deduction is only available to taxpayers who pay tax based on actual income received or accrued.

Deadlines

The personal income tax operates on a calendar year basis. However, withholding taxes on wages and pension contributions are conducted monthly, matching with the payment period. Personal Income Tax Annual Filing and Payment Form deadlines are from 1 January to 31 March. Meanwhile, Statement of Pension Contribution and Remittance Form deadlines are from 1 to 15 of each month.

Kosovo is working towards economic stability and higher personal incomes. Despite facing challenges, the country is seeing steady progress, thanks to policy reforms, foreign investments, and a focus on education and entrepreneurship. Before deciding to invest or live in Kosovo, companies and individuals should understand the country’s legal, financial, and tax systems. Our firm brings a wealth of knowledge and experience in international taxation. We invite you to get in touch with us for an introductory meeting, where we can explore how we can assist you in navigating these complexities.

הפוסט Personal Income Tax in Kosovo הופיע לראשונה ב-Nimrod Yaron Albania.

Corporate Income Tax in Kosovo

BananaBlitz — Tue, 04 Jun 2024 13:29:45 +0000

Kosovo’s tax system is based on a comprehensive framework that includes tax treaties, laws, and administrative guidelines related to corporate income tax rules.A country’s tax rates can attract investments because lower taxes mean higher profits for businesses. In this regard, Kosovo’s very low taxes make it an ideal place for investment. This article will offer a summary of the most important information regarding the corporate income tax rate in Kosovo.

Corporate Tax Residency in Kosovo

A legal entity is considered a resident in Kosovo for tax purposes if its main office or effective management is in Kosovo. A Permanent Establishment arises if a business operates in Kosovo through a fixed location for over six months in a 12-month period, including places like offices, factories, or natural resource sites. Construction or project sites also create a permanent establishment Kosovo within a year and they are subject to local tax rules.

Income Determination

In Kosovo, corporate income tax follows the principle of worldwide taxation. Subject of corporate income tax include corporations, other legal entities, business organizations operating with public/state-owned assets, and non-resident individuals with a permanent establishment in Kosovo. Residents are typically taxed on both foreign and domestic income, while non-residents are usually taxed solely on their income derived from Kosovo.

Corporate Income tax rate

The corporate income tax in Kosovo is 10%. Small businesses with a gross annual income under EUR 30,000 are exempt from corporate income tax but must make quarterly tax payments on their gross receipts, with rates varying by activity type 3% for trade and similar activities, 9% for services, and 10% for rent income.

Capital gains are taxed at the standard 10% corporate income tax rate. Dividend income is tax-exempt, while interest, rental, and royalty incomes are taxed at rates of 10%, 9%, and 10% respectively. Partnerships are not directly taxed; instead, individual partners are taxed on their share of income at the standard corporate income tax rate.

Resident corporations are taxed on worldwide income, with a tax credit available to avoid double taxation under Double Tax Treaties (DTTs). Withholding taxes (WHT) apply to payments like rent, interest, and royalties at rates up to 10%, and services from non-residents at 5%, with some exceptions based on DTTs. There is no WHT on dividends, and branch income is taxed similarly to other legal entities in Kosovo.

Tax Credits and Incentives

Kosovo offers a variety of tax incentives and credits designed to promote economic activity and investment. Dividends, both for residents and non-residents, are free from taxation, encouraging investment by ensuring investors can retain more of their earnings. For companies investing in new heavy machinery, there’s a substantial incentive in the form of a 10% deduction on corporate income tax for these assets when they are first used in Kosovo, although this is not available to those already benefiting from other tax incentives.

The country supports contributions toward sports, youth, and cultural activities by offering a corporate income tax credit of up to 30% for sports sponsorships and up to 20% for youth and culture contributions, demonstrating its commitment to societal development. Kosovo also provides a foreign tax credit to prevent double taxation on income earned abroad, offering a credit up to the amount of tax paid in the foreign country or the Kosovo income tax rate, whichever is lower.

These tax measures reflect Kosovo’s strategic approach to stimulate economic growth, attract foreign and domestic investment, and support important social sectors. Before deciding to invest in Kosovo, companies should understand the country’s legal, financial, and tax system. Our firm brings a wealth of knowledge and experience in international taxation. We invite you to get in touch with us for an introductory meeting, where we can explore how we can assist you in navigating these complexities.

הפוסט Corporate Income Tax in Kosovo הופיע לראשונה ב-Nimrod Yaron Albania.

Business Activity in Kosovo

BananaBlitz — Thu, 29 Feb 2024 13:18:51 +0000

Following its independence in 2008, Kosovo has made significant changes in social and economic development. Despite the challenges of the past, Kosovo has undertaken all efforts through internal and external policies to create a favorable situation for economic growth and investor engagement. This article will provide information about business activity in Kosovo which aims to help everyone who has intentions of investing in Kosovo.

Kosovo’s Economic Landscape

In 2022, despite the strong effect the COVID – 19 pandemic had a on its economy, Kosovo experienced a GDP growth rate of 3.5 percent primarily fueled by exports and private consumption. Kosovo’s main exports span various industries, including, agriculture, mining, and construction. The country’s main exports are scrap metal, nickel, lead, and mattresses. Furthermore, Kosovo provides convenient access to the European Union (EU) via air, road, railway transport, and three seaports.

Currently the business environment in Kosovo is getting really competitive compared to other countries in the region, by offering foreign investors an appealing and welcoming environment thanks to advantages such as low tax rates and tax system, rather straightforward business registration, and transparent laws on foreign investment. For example, an individual can register an LLC within 2 days, free of charge with zero chartered capital.

Moreover, Kosovo has drawn substantial foreign interest, with numerous international companies investing there. Many are enticed by Kosovo’s youthful workforce, affordable labor, nearness to the EU market, and its natural resources. Additionally, Kosovo also offers favorable terms for products entering the EU market through a Stabilization and Association Agreement (SAA).Top of Form

Investment Advantages and Legal Regulations in Kosovo

The laws and regulations in Kosovo align with global standards for encouraging and safeguarding investments. The country maintains a straightforward corporate income tax rate of 10 percent. In August 2022, with support from USAID, Kosovo introduced a Commercial Court. This court is designed to handle business disputes fairly, swiftly, and predictably, aiming to enhance the business environment by minimizing corruption risks and fostering trust among investors and the private sector in the judicial system. In its inaugural year, the court has already shown promising results, resolving business cases with greater efficiency and transparency.

Kosovo has a steady monetary policy. It is unique because it is one of the few countries outside the EU that uses the Euro as its official currency. This move has cut down on exchange rate worries and made trading and investing easier by lowering transaction costs.

The country’s location in the center of the Balkans makes it a gateway to the Balkans and CEFTA members. Together, these areas make up a market of around 28 million people, providing ample opportunities for trade and business.

In addition, Kosovo has a young, multilingual workforce, with many speaking English and German. Half of its population is under 30 years old. Kosovo also offers competitive labor costs and tax policies. With an average monthly salary of €371, it ranks among the lowest in Europe.

Investment Opportunities in Kosovo

There are several sectors that provide investment opportunities in Kosovo, including, the energy, health and the mining sectors.

Energy Sector – Currently Kosovo mainly relies on coal to fuel its power plants, but the country is wanting to expand its energy production and broaden its energy sources, especially by embracing renewable energy. Moreover, in February 2023, the EU unveiled a €75 million Energy Support Package aimed at broadening subsidy and incentive programs to enhance energy efficiency, particularly targeting vulnerable households.

Health Sector – Kosovo needs better basic and special medical care, more doctors and nurses, hospitals, and medicine. Right now, most health services are run by the government, but more and more private companies are getting involved. Many people from Kosovo go to nearby countries for medical help. This situation could be a good chance for investors from outside to invest and have high returns by offering local solutions.

Mining and Minerals – In the past, mining played a big role in Kosovo’s economy, but it is not as important anymore because there hasn’t been enough investment in equipment, buildings, and new mines, even though the country has evidence of critical minerals. However, there is a good opportunity for foreign investors in this sector, the Independent Commission of Mines and Minerals (ICMM) has given out more than 500 licenses for exploring and mining since 2007.

As Kosovo’s economy continues to grow, there will be an increasing demand for specialized services in different sectors. This includes the need for support with finances, legal matters, building and design, software development and graphic design. As businesses expand and new ventures emerge, the demand for these services will grow to ensure smooth operations and compliance with regulations. This presents opportunities for skilled professionals and companies to contribute to Kosovo’s economic growth and development.

It is important for individuals, before proceeding with investment, to be aware of the legal, financial and tax implications. Our firm offers comprehensive knowledge and experience in the international taxation realm. Contact us, and we would be happy to arrange an introductory meeting with you.

הפוסט Business Activity in Kosovo הופיע לראשונה ב-Nimrod Yaron Albania.

Inheritance, estate and gift Taxes in Kosovo

BananaBlitz — Tue, 23 Jan 2024 10:17:50 +0000

Situated in the heart of the Balkan Peninsula, Kosovo is a land of diverse cultures, and breathtaking landscapes. Despite the challenges of the past, Kosovo has undertaken all efforts through internal and external policies to create a favorable situation for economic growth and investor engagement. This article aims to provide a comprehensive overview regarding inheritance, estate and gift taxes in Kosovo.

Inheritance and Estate Tax Exemptions in Kosovo

In the context of inheritance, estate, and gift taxes the rates and exemptions can fluctuate depending on the relationship between the deceased and the heir. For instance, if assets or value of assets received as a result of inheritance and the heir is a spouse, biological or adopted child, or parent of the deceased, they are exempt from application of the Personal Income Tax (PIT).

Tax on Inheritance and Gifts for Other Heirs and Residents

In other cases where the heir is a person other than the above mentioned and the inherited value exceeds 5,000 Euro, a tax corresponding to the Personal Income Tax ranging from 0% to 10% will be applied to the amount exceeding this threshold. Regarding monetary gifts or gifts received by residents, they are treated as taxable income, if the value of such gift amounts exceeds 5,000 euro in a tax period.

The applied tax rates, depending on how the deceased and the heir are related, show a commitment to fairness in the tax system. Especially, the exceptions for close family members highlight the country’s focus on keeping family financial legacies intact.

Meanwhile Gifts, either monetary or things given, between spouses, a parent to their natural born, or legally adopted children, or from children to their parents are exempted from tax regardless of the amount or value of the gift. Additionally, gifts given for educational purposes are exempted from taxation as long as the gift is given in the form of tuition paid directly to an educational institution recognized by public law.

Encouraging Philanthropy and Economic Growth in Kosovo

Furthermore, gifts and inheritance revenues of foundations are fully tax-exempt from Corporate Income Tax. This exemption applies to organizations registered under the Legislation on the Registration and Operation of Non-Governmental Organizations that maintain public-benefit status. The income must be used exclusively for public-benefit purposes.

Through the above exemption Kosovo encourages charitable actions by giving tax-free status to Non-Governmental Organizations that serve public benefits. This shows a well-balanced effort to motivate philanthropy and make a positive impact on society.

Kosovo, with its small yet captivating presence in the Balkans, has demonstrated resilience and commitment to fostering economic growth and attracting investment despite historical challenges. As Kosovo navigates its path toward economic prosperity, understanding and navigating the intricacies of its tax policies becomes integral for both residents and potential investors.

It’s important for individuals to be aware of the inheritance tax laws in their specific country or region, as well as any changes that may occur over time. Consulting with a tax professional or estate planner can be beneficial in navigating the complexities of inheritance tax laws and developing a strategy to manage tax liabilities. Our firm offers comprehensive tax services in Kosovo, among other areas. Contact us, and we would be delighted to arrange an introductory meeting with you.

הפוסט Inheritance, estate and gift Taxes in Kosovo הופיע לראשונה ב-Nimrod Yaron Albania.

Setting up a business in Kosovo

BananaBlitz — Tue, 05 Dec 2023 12:25:04 +0000

Entrepreneurs seeking to expand their business in the region should consider Kosovo’s growing influence in the economic landscape. This article serves as a starting point by providing insights into Kosovo’s legal framework, economic opportunities, and sectoral potential. By conducting thorough research and adopting a strategic approach, entrepreneurs can take advantage of Kosovo’s favorable business climate to achieve success. Kosovo remains committed to supporting businesses and fostering an environment that encourages growth and innovation.

Benefits of doing business in Kosovo

Kosovo has a simple tax system. Furthermore, in comparison to other countries, its taxes are very low. In Kosovo, corporate tax is 10% and VAT is 18%.
The euro is the local currency in Kosovo, despite the fact that the country is not a member of the Eurozone.
It is simple to travel to neighbouring countries. Montenegro, Albania, Macedonia, and Serbia are never far away.
The success of business investment programs in Kosovo heavily relies on institutional support, which is provided by various non-governmental and private organizations.
The young workforce in Kosovo is mostly multilingual (they frequently speak English and German). Half of Kosovo’s population is under 30 years old.
Registering a business in Kosovo is an efficient and straightforward process that follows a standardized approach for both local and foreign companies.

Kosovo’s legal framework aligns with modern standards and EU principles.

Types of Business Companies in Kosovo

Individual business – the organization must have an official name that includes the lawful surname of the owner and the acronym “B.I.” since the owner has unlimited responsibility.
Partnership – Partnerships have both “unlimited” and “limited” partners, who are responsible for the company’s debts and their contributions in the charter capital, respectively. Names can include partners’ names and “SH.K.M.” for identification.
Limited Partnership – General partners share unlimited liability for the organization’s debts under a single name, including one partner’s name and the acronym “O.P.”
Limited liability companies – An LLC limits founders’ liability to their contributions and assets and is identified by a name followed by “SH.P.K.” KBRA doesn’t require proof of capital payment to register an LLC.
Joint-stock companies – JSCs have share-based capital and limit shareholder liability to their contributions. The organization is identified by a name followed by “SH.A.” The minimum charter capital is €10,000.
Foreign Commercial Company – A foreign company registered as a branch in Kosovo doesn’t have legal personhood but enjoys all rights and obligations. The name of the branch is followed by ” Branch in Kosovo ” or the acronym (“D.K”).
Social enterprises – A socially owned enterprise is a legal entity with mostly socially owned assets and capital.
Public enterprises – Public enterprises are established by the state for general interest activities and organized as Joint Stock Companies.
Agricultural cooperatives – Agricultural co-ops are formed by farmers who contribute private property to the shared capital. They are established with at least five signatories and require even-value shares with a minimum of €10.

Business Registration in Kosovo

There are several steps involved in the registration process if you intend to establish a company in Kosovo. Selecting the appropriate company type, naming your business, preparing the necessary documentation, and registering with the Kosovo Business Registration Agency and the Tax Administration of Kosovo are all part of the process. This process may appear daunting, but with the right guidance and support, it can be completed quickly and easily.

The first step is to complete an application form that is specific to the type of business you intend to establish. The application form can be found on the Kosovo Business Registration Agency (KBRA) website or at any KBRA center.

Following the completion of the application form, the next crucial step is to submit the form alongside the necessary documents. It is imperative to note that the specific documents required may be subject to variation depending on the nature of the business being registered. Therefore, it is highly recommended to thoroughly review the specified criteria and strictly adhere to the set deadline.

If you’re considering setting up a company in Kosovo or require assistance with various business domains, our firm provides the professional guidance and comprehensive support you need. Contact us now to schedule an introductory meeting, and take the first step toward achieving your business objectives.

Feel free to contact us.

הפוסט Setting up a business in Kosovo הופיע לראשונה ב-Nimrod Yaron Albania.