Search

This article presents information on the tax system in Macedonia in 2011. It discusses changes in the tax system to attract foreign investment. It highlights a number of tax reforms and incentives for both domestic and foreign investors. It also states the enforcement of corporate and value-added taxes (VAT) in the country. In addition, the article offers an overview of tax and legal services offer by a number of firms in the country, including Ernst & Young and PricewaterhouseCoopers Macedonia.

The article discusses an initiative by the Former Yugoslav Republic (FYR) of Macedonia to develop its tax system to attract more foreign direct investments. The Macedonian government has introduced several tax reforms and incentives favoring domestic and foreign companies and investors in order to establish itself as one of the preferred jurisdictions in Europe for tax structuring. Under its Foreign Exchange Law, banks are allowed to make payments to or from foreign countries with no restrictions. In 2008, the country implemented a 10% corporate income tax flat rate.

The article reports on the introduction of the principle of exemption for certain types of dividend distributions in the amendments to the Profit Tax Law of Former Yugoslav Republic (FYR) Macedonia which took effect on July 7, 2010.

The article discusses the legislative amendments that continuously being pursued by the government of FYR Macedonia in its bid to attract more foreign direct investment to the country. The changes intend to level off the conditions for foreign and local investors, along with extensive incentives on investments. The definition of a resident legal entity under the country's law is an entity whose main offices and representative offices are located in the territory of FYR Macedonia. The transactions that can be made by non-residents are also cited, including the right to acquire or sell real estate for business purposes.

The article probes into the new income and capital tax treaty formed by Macedonia with Slovakia. The treaty was signed by the countries on October 5, 2009 and has been ratified by the Parliament of Macedonia. It will replace the existing 1981 treaty between the former Yugoslavia and the former Czechoslovakia, and will be implemented for at least five years. Under the treaty, the maximum withholding tax rate at source will be set at 5% for dividends and 10% withholding tax for both interest and royalties.

The article reports a real estate boom experienced by the Balkan country of Macedonia. The location of the country makes it the perfect distribution and transit center. The government has introduced legislative changes to make it easier for foreign entities and citizens to acquire property. The most attractive region for investment is the capital city of Skopje.

The article explores the Law on Value Added Tax in the Republic of Macedonia, which underwent several revisions throughout 2014 and its latest form as of January 2015 introduces changes that will significantly impact most small and medium businesses.

The article examines the two-fold system of corporate tax in Macedonia. The first element involves tax arising in cases of dividend distribution. The second elements deals with non-deductible expenses plus any understated revenues. Employee-related expenses, public interest donations and sponsorships, and entertainment expenses are partially deductible expenses.

The article discusses the developments on the area of taxation in FYR Macedonia as of mid-2013. It claims that the mandatory use of the electronic tax (e-tax) system from the Public Revenue Office (PRO) started in early 2013. It explains how legal entities could register to the system, particularly on the completion of a digital certificate secured from an authorised digital certificate institution and a valid email address.

The article reports on the enactment of the Law of Lawyer Stamps in the Republic of Macedonia in July 2012. It mentions that despite the enforcement of the law, the Constitutional Court of the country continues to review the law in 2013. According to the author, the review was caused by criticisms raised by a great numbers of lawyers in the Republic. The author adds that the law mandates every lawyer who earn income in cash to attach lawyer stamps to every form or document that they forward to the taxation authorities.

The article offers information on the ratification of the income tax treaty between Macedonia and Kazakhstan. It states that the treaty covers the personal income tax and profit tax in Macedonia and the corporate income tax and the individual income tax in Kazakhstan. It mentions that the treaty stipulates that both countries will allow deduction from taxes in the amount of tax paid on it in the other state.

The article reports on the move by the former Yugoslav Republic (FYR) of Macedonian Parliament to ratify the income and capital tax treaty that was established by the Macedonian government with Kuwait in early 2012. Among the taxes covered by the treaty are corporate income tax, personal income tax, and property tax. It claims that the treaty is mainly harmonised with the Organisation for Economic Co-operation and Development (OECD) convention. The provisions of the treaty for permanent establishment (PE) are also examined.

The article reports that the Property Tax Law in Macedonia has been amended. The changes will take effect in January 2013. The changes allow employees of the local self-government bodies to conduct property assessments. The local self-government bodies will also be allowed to request an external certified assessor to perform a property value assessment. Property assessments are needed to determine the property tax base. Property taxes in Macedonia are considered as local taxes, being paid to local municipalities.

The article reports on the adoption of an amended Law on Tax Procedure in the FYR Macedonian Parliament in June 2012.

The article discusses tax treatment of dividends paid in Macedonia which largely depends on the residency of the dividend-receiving entity. A principle of exemption was introduced in the country for certain types of dividend distributions on July 2010, which exempted all forms of profit distribution made to resident legal entities from corporate income tax. It is noted that despite the development, dividends distributed to non-residents, legal entities or individuals, continue to be taxed in the country.

The article presents a forecast for capital investments and tax revenue in Macedonia in 2012.

The article discusses various tax treatments of stock-taking differences under value-added tax (VAT) legislation in Macedonia. It explains why justifiable shortages of stocks are not subject to VAT. It identifies the purchasing price of goods as the tax base for the payment of VAT. The exclusion of any provisions for the tax treatment of registered stock surpluses in the legislation is noted.

The article reports on the September 2011 amendment of Macedonia's Corporate Income Tax, which gives two separate taxation system options to companies with annual income above 3 million Macedonian denar and up to 6 million Macedonian denar.

The article focuses on the amendments on the value-added tax (VAT) law of the Former Yugoslav Republic (FYR) of Macedonia, which entered into force on October 11, 2011. It says that the changes related to the preferential VAT rate of 5% are the most important amendments on the VAT law. It notes that the application of the preferential rate is extended until the end of 2015. It mentions that two products/services categories that are subject to the 5% preferential VAT rate such as the raw oil for food production and the services of commercial tourist facilities. It states that VAT registrations and de-registrations procedures will be sped up, wherein the law offers options for taxpayers who applied for a VAT registration.

The article discusses the concepts of transfer pricing and thin capitalization in FYR Macedonia. It says that some rules and procedures in the Profit Tax Law of the country may have impact on transactions involving foreign investors. According to the author, the legislation of FYR Macedonia distinguishes between the concepts of significant control and having the possibility to exercise significant power on the decision-making process of a company.

The article discusses the law on withholding taxes in the former Yugoslav Republic (FYR) of Macedonia. According to the author, withholding tax is tax paid on corporate income that non-resident entities realise in FYR Macedonia. The author adds that the payment of withholding tax is the liability of domestic companies and individuals as well as non-resident companies and individuals that are permanently established in FYR Macedonia.

The article discusses the amendments in the Profit TaxLaw in Macedonia which were implemented starring April 2011. It says that the amendments will greatly influence foreign companies that have active offices in the country. It mentions that the changes affect the regulations and provisions related to tax base in which a tax period is equivalent to a firm's non deductible expenses with the addition of the difference between the actual and reported income. According to the author, other taxable expenses include expenses related to the use of personal vehicles for business reasons.

The article focuses on the issue of value added tax (VAT) treatment of corporate promotional spending in the former Yugoslav Republic (FYR) of Macedonia in 2011. Companies opting to distribute free promotional materials are known to deal with the narrow VAT treatment of expenses in the framework of the country's tax system. There is limitation in the provisions of the VAT law concerning opportunities for tax deductions for promotional items and giveaways.

The article reports on the possibility of value-added tax (VAT) refund for non-residents provided by the FYR Macedonian VAT Law. It says that entities without a permanent establishment in FYR Macedonia can recover VAT paid for purchases of services and goods on the territory of FYR Macedonia. According to the author, the lowest VAT amount that can be refunded is 680 U.S. dollars. The additional conditions that must be met before the VAT refund can be done are also discussed.

This article discusses the imposition of withholding taxes in FYR Macedonia. It identifies the payment of withholding tax as the liability of domestic companies and individuals and non-resident companies and individuals with a permanent establishment in the country. It also explores the imposition of withholding taxes on the transfer of after-tax profits of a permanent establishment of a non-resident.

This article reports on a double tax treaty signed by Macedonia and Morocco on May 11, 2010. The treaty seeks to avoid double taxation and prevent fiscal evasion for income taxes. It applies to the income and corporation tax in Morocco and the personal income and profit tax in Macedonia. The treaty will be effective starting January 1, 2011 upon its ratification by both countries.

The article reports on the income and capital tax treaty signed by Former Yugoslav Republic (FYR) Macedonia and Belgium on July 6, 2010, which replaces the 1980 treaty between former Yugoslavia and Belgium. Under the new treaty, provisions of the agreement signed between the two countries will not apply to taxes on income and capital covered by the new treaty. The treat provisions maintain that any site or project located in any of the two countries which lasts for over a year is considered a permanent establishment.

The article provides information on the income tax treaty signed by Former Yugoslav Republic (FYR) of Macedonia and Estonia on November 20, 2008, effective January 1, 2010 and applicable for a minimum period of five years. For dividend payments, the treaty provides a general withholding tax at source, with a 5 percent limit but can be reduced to 0 percent in some cases. A 5 percent limit for withholding tax at source is provided in the case of interest payments. An analysis of the treaty from a capital gains perspective is presented.

The article reports on the taxation of technological industrial development zones (TIDZs) in Macedonia. It states that as part of the government's priority initiatives, the zones' land is available under long-term lease and companies starting their operations in one of the four available zones will not be subjected to utility taxes. It notes that a 10-year tax holiday is also offered which will exempt companies from paying both profits tax and personal income tax. It adds that companies operating in TIDZ are also exempt from the payment of value-added tax (VAT) and customs duties for goods, raw materials, equipment and machines used for export production.