The payroll statement is the monthly report that consolidates in a single document wages, withheld taxes, and insurance contributions for each employee. It is submitted only electronically, and the deadline for entities is the 20th of the following month.
This page covers deadlines by business type, what the payroll list includes, the steps in the electronic reporting system, the onboarding and offboarding of new employees, and corrections and penalties related to employee and payroll reporting.
Read also: What are the insurance contributions and how are they calculated?.
Entities, that is, commercial companies and other legal entities, submit the payroll by the 20th of the following month. Individual traders and self-employed persons who have employees submit it by the 20th after the end of each quarter.
| Who declares | Periodicity | Deadline |
|---|---|---|
| Entities, business entities | Monthly | The 20th of the following month |
| Merchant natural person | Three-month period | On the 20th after each quarter |
| Self-employed with employees | Three-month period | On the 20th after each quarter |
Within the same period, the obligation is also paid. A declaration without payment does not satisfy the obligation, and a payment without declaration does not either.
The payroll list is not a single figure. For each employee, the data defining the base, the withholdings, and the coverage period are reported.
✔ Employee identification and job position
✔ Start date of the employment relationship and end date, when applicable.
✔ Gross monthly salary, including bonuses and in-kind benefits
✔ Contract hours, because they determine the contribution rates.
✔ Wage tax withheld after applying the required deductions
✔ Employee contribution and employer contribution
✔ Insurance days and benefit periods when there is a medical certificate or maternity leave.
Team of three employees with gross salaries of 50,000, 80,000, and 120,000 lek. Total gross pay is 250,000 lek. Withheld tax is 0, 6,500, and 11,700 lek, totaling 18,200 lek. Employees' contributions are 5,600, 8,960 and 13,440 lek, totaling 28,000 lek. Employers' contributions are 8,350, 13,360 and 20,040 lek, totaling 41,750 lek. The payroll obligation is 87,950 lekë. Employees receive 203,800 lekë in hand, and the total cost to the business is 291,750 lekë.
The declaration is filed only electronically, through the taxpayer's account. Access is done with the entity's credentials or via the government portal, and the payroll statement form is found in the period declarations section.
✔ Step 1. Logging into the taxpayer's account and selecting the reporting period
✔ Step 2. Opening the payroll form for the relevant month or quarter
✔ Step 3. Updating the employee list by adding new employees and removing those who have left.
✔ Step 4. Enter gross wages and hours, or import the file from the payroll program.
✔ Step 5. Verification of the tax and contributions that the system calculates against your calculation.
✔ Step 6. Submission of the declaration and generation of the payment order
✔ Step 7. Payment within the deadline and keeping the proof of payment.
The fifth step is the one that saves the most time. When the system figure and the payroll program figure don't match, the reason is almost always in the contract hours, the insurance cap, or the deductions requested by the employee.
Read also: Discounts and how they are requested by the employee.
The new employee is added to the employee list and appears on the payroll for the pay period in which the employment relationship begins, with the exact start date. The start date determines the days of coverage and the first month's base.
Read also: Payroll agent and personal status declaration.
Termination is recorded as of the date the employment relationship ends. An employee who leaves in the middle of the month is recorded for the days worked, and contributions are calculated on that month's salary.
Caution. The timing for declaring a new employee relative to their start date follows its own procedural deadline, which must be verified in the applicable regulation before you assume it. The practical rule we apply is to declare the employee before their first day of work, because the fine for undeclared employees is among the highest.
When a payroll is filed in error, it is corrected by an amended return. The Tax Procedure Law allows the amended return to be filed within 24 months of the original filing deadline.
The correction that increases the liability results in payment of the difference. When the error is discovered and corrected by the taxpayer before the tax authority notices it, the position is always better protected.
Read also: Tax audit, rights, and self-declaration.
Wage-related fines are divided into two groups: those for late declaration and payment, and those for undeclared employees or hidden wages. The second group is much more severe.
| Violation | Fine |
|---|---|
| Unregistered employee, subject to VAT or simplified taxation | 200,000 lek |
| Undeclared employee, other entities | 50,000 lek |
| Page hiding, legal entity | 200% of the obligation |
| Page hiding, others | 100% of the obligation |
| Failure to file on time, registered taxpayer | 10,000 lek or 5,000 lek per category |
| Late payment | 0.061 TP3T per day, up to a maximum of 365 days. |
For fines, the Tax Procedure Law sets a general limit. The penalty for a tax liability does not exceed 100% of the liability itself. In addition to the penalty, non-payment also incurs late interest, calculated at 120% of the average interbank rate and updated quarterly.
Obligation of 87,950 lek paid 30 days after the due date. The late payment fee is 0.061% per day, so 1.81% over 30 days, which amounts to 1,583 lek. Late interest is calculated separately on the same obligation and for the same days. The amount is small, but it occurs every month the due date passes, and the repetition creates a negative record in the subject's file.
Read also: Full table of tax fines.
✔ All new employees have been added, with their exact start dates.
✔ Departures have been deregistered, with exact end dates.
✔ The contract hours match the contribution rates you apply.
✔ Wages above the Social Security cap have been processed correctly.
✔ Monthly rewards and bonuses are included in the base.
✔ The discounts requested by employees have been applied to the sole employer that retains them.
✔ The contribution base is not below the minimum wage for standard contracts.
✔ The payment order has been paid within the same deadline as the declaration.
Read also: The complete tax calendar of the year.
Entities submit by the 20th of the following month. Traders and self-employed individuals with employees submit by the 20th after the end of each quarter.
No. The declaration is made only electronically, in accordance with the Law on Tax Procedures.
Read also: Salary verification is now available on e-Albania..
200,000 lekë for VAT and simplified tax entities, 50,000 lekë for other entities. If the wage has been declared lower than it actually is, the fine amounts to 200% of the obligation for legal persons.
The amended statement is filed within 24 months of the deadline for the original statement.
It is declared with the end date of the employment relationship and the pay for the days worked. Contributions are calculated on that month's salary.
When the entity has no active employment relationship and no insurance obligation for itself, the declaration contains no information. This case depends on the entity's form and the administrator's status, so it is assessed on a case-by-case basis.
The person who manages and works in the company has a duty to provide insurance, which is reflected in the declaration. The basis and form of the declaration depend on the circumstances, so they are handled on a case-by-case basis.
The installment agreement does not apply to withholding tax and contributions. For these obligations, the only option is payment, so they must be planned before the net payroll payment.