Property Taxes in Montenegro

20.01.2025

Property Taxes in Montenegro - With the news last week from Spain that the government is considering a significant increase on the property purchase tax that will need to be paid by Non-EU citizens and Non-Residents (i.e. those who are buying for holiday-home purposes), many people have started to look at alternatives which can offer a better or similar lifestyle, without the worry of a possible hefty tax liability. Montenegro, already highly popular due to it's stunning landscapes, relaxed lifestyle, and favorable tax regime is now the hotspot in which to invest and buy a new home abroad.

The Basics of Buying Property in Montenegro - Foreigners can purchase property in Montenegro with minimal restrictions, making it an attractive option for investors, expats, and holiday homeowners. Buyers typically need a valid passport, a local bank account, and a Tax Identification Number (TIN) to proceed. Working with a reputable real estate agent like CMM Montenegro and getting yourself a legal expert is highly recommended to navigate the process efficiently.

Property Taxes in Montenegro - When purchasing property in Montenegro, buyers are subject to the Property Transfer Tax or VAT (Value Added Tax), depending on the type of property.

• The property transfer tax in Montenegro is applicable only to re-sale properties, and is charged at a flat rate of just 3% of the property market's value. 
• VAT is applied to new builds sold directly by developers, and this rate is typically just 21% of the purchase price, though rates may be reduced where the property will be used for residential purposes

Ongoing Property Taxes in Montenegro - Montenegro imposes an annual property tax, which is relatively low compared to other European countries. This tax varies based on the property’s location, type, and market value, typically ranging from 0.1% to 1% of the property’s assessed value. Coastal areas or premium properties may attract higher rates. To stay compliant, property owners should register with the local tax office and ensure timely payments to avoid penalties.

Income Tax for Non-Residents -  If you plan to rent out your property, income tax applies to the rental income. Non-residents are taxed at a flat rate of 9% on rental income after deducting allowable expenses, such as maintenance and management costs. Non-residents should also register for tax purposes and report rental income to Montenegro’s tax authorities annually. 

Additional Costs to Consider - When purchasing property in Montenegro, several additional costs may arise beyond taxes:

• Legal Fees: Typically 1% of the property value.
• Notary Fees: Approximately 0.1% to 0.5% of the transaction value.
• Bank Charges: If financing the purchase, banks may charge 1% to 2% of the loan amount for processing fees.
• Surveyor Fees: Recommended for verifying the property’s condition, costing around €300-€500

Selling Property in Montenegro - When selling property in Montenegro, sellers are subject to approx. 15% capital gains tax, making the country particularly attractive for investors seeking long-term gains. You may also incur real estate agent fees (3%-5%) and legal fees during the sales proces.

Appealing in Many Ways - Montenegro’s straightforward and relatively low-tax regime is a significant draw for property buyers and investors. With a clear understanding of property taxes in Montenegro, ongoing obligations, and additional costs, you can make an informed decision and enjoy the benefits of owning property in this picturesque Balkan gem.

Whether you’re looking for a holiday retreat, a rental investment, or a permanent residence, Montenegro offers opportunities for every type of buyer. By planning your finances and consulting with professionals, your property journey in Montenegro can be both smooth and rewarding.

CMM Group covers a wide range of areas in Montenegro including Tivat, Kotor, Budva, Bar and Petrovac. We are well placed to help you discover this unique part of the world, and we are ready to assist you in the purchase of your dream home any way we can, if you decide to invest here. If you'd like further information on Property Taxes in Montenegro, or you'd like to discuss options, please do contact us, and let's have a chat.

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Reviews

• In period May-August 2022 we sold our flats in St-Petersburg Russia and  have bought two  ones here in Montenegro, Becici. We decided to move here and make new home and business with my husband. Our agent Milica Zugic  is really became our angel - provider here in Montenegro. She is very reliable, responsible , professional  employee of CMM Budva department. She has developed intuition and found very fast necessary properties which we needed. Also she helped us to speed up the process of registration documents in MUP.( list nepokretnosti, etc). She was our real provider here. Very appreciated her and all staff of Budva department for there assistance. Separately to lawyer Ivan and his legal team. Very recommended choose Milica Zugic as real estate manager when you search for assistant in this complicated and important field as buying property in Montenegro.

  Liudmila Nosova St-Petersburg Russia , 13.09.2022 09:20:09

• At the beginning of April 2022, our family living in Prague bought a house in Sutomore with the assistance of your company.
  Let me express my gratitude to the management of your company for the service provided, and especially to your employees - Anastasia Zeyak, Alexei Grachev and Elena Bozhovich for their attention, patience and even care for the whole time of buying real estate and the services provided after the purchase.
  I would really like all companies to work with the same quality of service. After coming into contact with this kind of attitude towards the client, all our environment, if necessary, will refer to your company only.
  With gratitude on behalf of our family.

  A.V. Ter-Gazaryan, 12.07.2022 10:32:19

• Based on my experience with CMM in Budva, Montenegro, I can say that they are reliable, fast, and they deliver what they promise. They take really good care of their clients. For instance, I was offered a lift from the airport, and they would take me back and forth from Tivat to Budva and Becici to see various properties. They would answer all of my questions and respond promptly. They have an excellent team: Katarina, Alexander, Natasha, Martin and some other guys whose names I don’t remember. Katarina, my wonderful agent, went to every length to help me find a perfect home. Unfortunately, my situation changed and I had to postpone my relocation to Montenegro.
  I would strongly recommend this company to anyone who is looking for a property in Montenegro.
  

  Val , 13.05.2022 02:18:13

• We were introduced to CMM by friends who had already done research on Montenegro and CMM. We purchased our apartment in Dobrota, just outside Kotor, all remotely from South Africa, during the lockdown. Everything was seamless without any problems at all. All the CMM departments work together well from the sales team, head office, legal, interior design and rental department. Every detail was well communicated with an abundance of zoom meetings, videos, emails etc
  We are thrilled with the outcome and enjoyed working with the CMM team. They were incredibly professional.
  After sales service is also excellent as we move into the rental phase of the apartment and over all management of the apartment including maintenance.
  We have been directly and indirectly involved with many houses/apartments all over the world and this was the up there with the best service we have received.
  Thanks to everyone we dealt with at CMM it has been an absolute pleasure dealing with you all. We look forward too many happy years working with you on our rental.
  

  Mandy and Antoine, 06.10.2021 08:56:22

• Biz Montenegroda CMM komandayla  tanish olmushug. Snejana ve Milan bize cox  yaxshi destek olublar. Artig bizim burada evimiz de var. Bize gosterdiler cox yuksek service, ve artig butun bizim senedler de gaydasindadir. Boyuk hormetle onlara Cox sagol bildiririk!

  Dilara, 01.10.2019 06:17:27

• Last year we decided to find a new home close to the sea. It was quite difficult in the beginning to make the right choice. Once we found CMM Company was a great luck! We immediately received detailed consultation on the country and purchase opportunities. Being attracted by Kotor - one of the most amazing parts of the coast, we decided to take a family trip and maybe make our dream of new home come true. As just discoverers of Montenegro, we were accepted like at home which was a one more pleasant surprise. The most important, we received all detailed information about country regions and procedure of buying property during the first few days. And how beautiful the car journeys were! Difficult choice, but when you find the home you want you can't refuse it. CMM did best to help us with this finding! All the purchase procedure passed well with CMM professional work! Now we are happy owners of a wonderful house with a Kotor bay view, being perfectly served by CMM Management company (of course, we've chosen CMM as professional house manager). Hope our friends and relatives would also move to Montenegro with the CMM help soon !!!

  Kate, 22.03.2019 11:06:21