North Macedonia’s legislation on inheritance, estate and gift taxes is based on the property law. The rules determine how assets are valued and analyse the relationship between the donor and the recipient. This article provides an analysis of the regulations for individuals, businesses and anyone interested in North Macedonia’s inheritance and gift tax policy.

Tax Liability

In North Macedonia, the obligation to pay inheritance or gift tax rises when the market value of assets such as cash, securities, or other movable properties, surpasses the average annual salary in the country, as settled by the State Statistics Office.

Tax Residents: Natural persons and legal entities residing in North Macedonia are liable for the inheritance and gift tax if they inherit a property, as regulated by Article 10 of the Property Taxes Law, either within the country or abroad.

Foreign Tax Residents: individuals in North Macedonia are liable for the inheritance and gift tax if they inherit or are gifted immovable and movable properties located within the territory of the country.

Calculation of Tax Base

The tax base for inheritance and gift tax is determined by the market value of the property at the time the tax obligation rises. This amount is then adjusted for any debts and costs associated with the property.

Inheritance and Gift Tax Rates

Inheritance and gift tax rates are proportional and depend on the relationship to the deceased or giver. Those in the first order of succession are exempt from paying these taxes. Beneficiaries in the second order are taxed at rates between 2% and 3%. For those in the third order, or unrelated beneficiaries, the rates range from 4% to 5%.

Policy of Exemptions

The North Macedonian law provisions certain exemptions from inheritance and gift tax. Here are the categories that qualify for these exemptions:

• Beneficiaries within the first hereditary order are exempt.
• Second hereditary order beneficiaries are exempt for one inherited or gifted apartment or family residential building, under the condition of cohabitation with the decedent for a minimum of one year prior to their death or the moment of gift receipt, and absence of ownership of other residential properties.
• Beneficiaries within the second hereditary order, whose primary occupation is agriculture, are exempt for inherited or gifted agricultural land and structures, provided they meet similar cohabitation requirements.

It is important to understand North Macedonia’s inheritance and gift tax laws when managing estates and other assets. 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 North Macedonia. Please feel free to contact us.