Montenegro is one of the most affordable countries in Europe in terms of real estate prices and one of the easiest in terms of legal formalities for foreigners. In recent years, it has become particularly popular among citizens of the CIS and EU countries due to its mild climate, sea, prospects for price growth, and loyal tax policy. However, when buying an apartment or house, it is important to understand what taxes and fees you will have to pay.
Main taxes when buying real estate in Montenegro
Rate: 3% of the market value of the property as determined by the tax authorities (not always the same as the price in the contract).
The tax is paid once, within 15 days after the conclusion of the agreement and submission of documents to the tax office.
Rate: 21%, already included in the contract price.
In this case, the property transfer tax (3%) is not levied.
Property ownership tax
The rate is set by municipalities and usually ranges from 0.1% to 1% of the cadastral value (depending on the location, type, and condition of the property).
For example:
Apartment in Budva or Kotor — approximately 0.25–0.5%
Properties on the coast and in tourist areas are taxed at a higher rate
The tax is paid once a year, usually by the end of March.
Important: a penalty is charged for late payment.
Additional costs
Renting real estate: taxes for the owner
If the property is rented out, the owner is obliged to:
Obtain a short-term rental permit from the municipality.
Keep a register of guests and pay tax:
Fixed tax on rental income — 9%.
Plus tourist tax per guest — approximately €1 per night.
From 2024, compliance with these requirements will be actively monitored (introduction of electronic accounting systems).
Example
Apartment in Budva for €150,000, purchased from a private individual:
Property transfer tax: 3% = €4,500
Annual property tax (0.4%): €600
Notary + registration fees: ~€1,000
In case of rental: income tax — 9% of profit
Montenegro offers a relatively simple and predictable tax system for real estate. One-time tax on purchase — 3% or 21% (for new construction), annual tax — low. Rental income is taxed at a moderate rate but requires compliance with formalities.
Source: http://relocation.com.ua/property-taxes-in-montenegro-what-buyers-need-to-know/
