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Albania
Individual - Taxes on personal income
Last reviewed - 05 July 2024Individual taxpayers, both residents and non-residents, are subject to personal income tax (PIT). Albanian law applies the principle of worldwide taxation. Resident individuals are taxed on all sources of income in and outside the territory of Albania, while non-resident individuals are taxed on income generated only in the territory of Albania.
Personal income tax rates
Taxable income of the individual (subject to PIT) is composed of three categories:
- Income from employment.
- Business income.
- Income from investments.
Income from employment
The following tax rates apply to income generated from employment:
| Monthly personal income from employment (ALL) | Taxable income per month (ALL) | PIT rate | ||
| From | To | From | To | |
| 0 | 50,000 | 0 | 50,000 | 0% |
|
50,001 |
60,000 |
0 | 35,000 | 0% |
| 35,001 | 60,000 | 13% of the amount exceeding ALL 35,000 | ||
|
60,001 |
Above |
0 | 30,000 | 0% |
| 30,001 | 200,000 | 13% of the amount exceeding ALL 30,000 | ||
| 200,001 | Above | ALL 22,100 + 23% of the amount exceeding ALL 200,000 | ||
From 1 January 2025, taxable income from employment is taxed at the following progressive rates:
| Annual tax base (ALL) | PIT rate (%) |
| 0 to 2,040,000 | 13 |
| Over 2,040,000 | 23 |
Business income
Net taxable income (taxable profit) from business for commercial individuals and the self-employed is taxed at the following progressive rates:
| Annual tax base (ALL) | PIT rate (%) |
| 0 to 14 million | *15 |
| Over 14 million | 23 |
*Note that, for commercial individuals and the self-employed (as well as entities) with an annual gross income up to ALL 14 million, the PIT rate will be 0%, applicable until 31 December 2029.
Natural persons, individual traders, or self-employed individuals with an annual turnover of up to ALL 10 million have the right to choose a special regime that allows for an automatic deduction of the business expenses up to a specific percentage, depending on their business activity. Once chosen, this regime cannot be changed for three consecutive years.
Income from investments
Investment income is taxed at the following rates:
- Income from dividends: 8%.
- Any other item of investment income: 15%.
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