- In April 2020, the COVID-19 emergency regulation postponed or eliminated the 2020 income tax prepayment installments as an emergency measure, not as a permanent change to the rules.
- Businesses with revenues of up to 14,000,000 lek did not pay that year's installments, while larger businesses deferred payments until September 2021, without having them forgiven.
- The current rules on prepayments and income tax rates (0%, 5%, 15%) operate under the current legal framework, which has been amended several times since 2020.
- The zero-rate tax relief for small businesses still exists today, but on a different legal basis and with different deadlines than the 2020 emergency measure.
In April 2020, as a support measure against the consequences of Covid-19, it was announced that small businesses with a turnover of 5 to 14 million lekë would not pay the down payment installments for the 2020 corporate income tax, while businesses with revenue over 14 million lekë would postpone payments of some installments until September 2021, without receiving a waiver.
From our daily work, we see that some clients still confuse this temporary 2020 measure-s with today's income tax prepayment rules, or think that the 0% relief for small businesses stems from that emergency measure, when in fact they are based on different legal frameworks.
Read also: Tax on profit for a legal entity: when paying 0%, 5%, and 15%., our current guide on the income tax scheme.
How this measure was born in April 2020
What did the 2020 regulatory act provide?
The regulatory act on changes to income tax eliminated the prepayment obligation for businesses with up to 14 million lek annual turnover for the year 2020, and postponed the second and third quarter 2020 installments for large businesses until September 2021, with some sectoral exceptions (banks, telecommunications, pharmaceuticals, food, and fruits and vegetables).
Why was it a temporary measure, not a permanent rule?
This was one of several emergency fiscal measures taken during the pandemic, limited solely to 2020 and that year's installments. It did not change the general rules for income tax prepayment, but only postponed or suspended their application for a specified period.
Every time there is a tax or financial change that affects your business, we notify you directly by email with a practical explanation.
Send me free notificationsWhy does it matter today?
Current rules on prepayment and income tax rates
Today, income tax prepayments are calculated under the current rules, with legal changes even after January 2024, and not under the extraordinary extensions of 2020. You can find the details and formats for adjusting the installments at Our guide to advance payments on income tax. The zero-rate tax relief for small businesses continues today, with a legal basis and a term extending until 2029, as we explain in Zero tax in Albania until 2029.
How we handle this with our clients
When we calculate prepayment installments for a client, we always do so according to the current rules and his actual turnover, without relying on emergency measures from previous years that are no longer in effect.
Frequently asked questions
Do the 2020 deferrals still apply?
No, they were limited only to 2020 and that year's installments, with payments having been completed since 2021.
What does the law currently provide regarding advance payments of income tax?
You can find the current rules, with the changes after January 2024, in our special guide on income tax prepayments.
Does the 0% relief for small businesses still exist?
Yes, but with a legal basis and a different duration from the 2020 measure, currently extended until 2029.
