Montenegro

Social security contributions

The mandatory social security contributions (SSC) in Montenegro include:

• pension and disability insurance;
• unemployment insurance.

There is an annual cap for pension and disability insurance contributions.

Regarding SSC on salaries, the entire pension and disability insurance, set at a rate of 10%, is borne by employee. Costs of unemployment insurance are borne by both employee at rate of 0,5% and by employer at rate of 0.5%.

Employers are liable to calculate and withhold mandatory social security contributions at the payment of employees' salaries. The mandatory social security contributions borne by employer represent their operating expenses.

SSC are also levied on other types of personal income in accordance with the SSC Law.

Consumption taxes

Value-added tax (VAT)

The main principles of the Montenegrin VAT align with the European Union (EU) Sixth Directive guidelines. The subject of VAT includes the supply of goods and services for consideration, as well as the import of goods into Montenegro. The general VAT rate is 21%. Certain supplies of goods and services, and the import of goods are subject to reduced VAT rates.

See the Other taxes section in the Corporate tax summary for more information.