Montenegro, a small yet wonderful Balkan country, has gained recognition for its natural beauty, cultural richness, and developing economy. It becomes crucial for individuals to understand the country’s tax system as they explore opportunities in Montenegro. This article aims to offer a detailed summary of Montenegro’s inheritance, estate, and gift taxes.
Montenegro has implemented a tax structure characterized by relatively low rates. This strategic approach by the Montenegrin government is primarily aimed at achieving a significant policy objective: to entice foreign individuals and businesses to relocate and invest in Montenegro, thereby leveraging the country’s potential opportunities.
In the context of inheritance, estate, and gift taxes the rates can fluctuate depending on the relationship between the deceased and the heir. Gifts and inheritances given to spouses, children, or parents are exempt from taxation, aligning with the family-oriented tax policies of the nation. For all other cases, both gifts and inheritances are subject to a uniform tax rate of 3%, simplifying the tax structure for these transactions. This tax policy reflects Montenegro’s efforts to maintain a straightforward and equitable tax system.
Montenegro law on tax administration burdens the obligation of the heirs of a deceased person to pay the deceased person’s tax liability up to the value of inherited property, proportionally to their share in inheritance. Meanwhile the Law on Tax Turnover of Immovable Property charges the heir with the responsibility to pay the tax turnover of immovable property. The tax turnover applies also in the case of gift or other forms of acquisition of immovable property.
However, if the heir decides to renounce their inheritance or transfer it to another co-heir during the probation process, they will be exempt from paying the tax for the act of renunciation or transfer. On the other hand, the individual receiving a gift or acquiring immovable property without compensation is liable for the tax on property turnover. Similarly, when immovable property is obtained through a whole-life support contract, the responsibility for the tax falls on the acquirer of the property.
It is important to mention that Montenegro now offers digital wills, enabling people to create wills electronically. These digital documents must be stored either with a notary or digitally to ensure their validity. Additionally, Montenegro has updated its inheritance tax laws to be equitable and more reflective of the estate’s value, easing the financial burden on heirs.
Non-Montenegrin residents enjoy the same property inheritance rights as Montenegrin citizens, allowing them to easily buy, own, and pass on real estate in Montenegro. The country actively welcomes foreign investment in real estate, making it straightforward for non-citizens to establish and pass on Montenegro property to their families.
If you inherited real estate or received gifts in Montenegro and you are looking for more information about the applicable procedure and taxes, our office has the resources and contacts to offer precise information and support that will help you navigate through the process. Reach out to us for assistance.
If you have inherited property or received gifts in Montenegro and seek guidance on the relevant procedures and taxes, our firm offers comprehensive support. We possess the necessary expertise and connections to provide accurate information, assisting you in efficiently navigating the complexities of this process. For tailored assistance and detailed insights into Montenegro’s property and gift tax regulations, please feel free to contact us. We’re here to help you manage these matters with ease and confidence.
