The Tax Administration has implemented differences important in the Withholding Tax Declaration, which will take effect from January 2025. These updates aim to simplify the declaration process, increase data accuracy, and facilitate businesses' tax compliance.
Key Improvements in the Withholding Tax Statement
From February 2025 onwards, the declaration will be pre-filled with data from the previous declaration for specific income categories, such as:
- Rent payments to individuals
- Capital gains from life insurance and private pension schemes
- Payments for intellectual property and copyright
This means that if a taxpayer has filed the statement for January 2025, the version for February 2025 will be automatically pre-filled with the data from the previous month. Taxpayers can change, add, or delete this data before the final submission of the statement.
New Declaration Features
- Export to Excel – The declaration can be saved or submitted in Excel format.
- Minor modifications – Taxpayers can select and delete data in bulk.
- Analytical formats – Includes detailed information on each payment and tax withheld.
- The object of the statement – Self-completion of certain sections from the previous month's declaration, including rents, capital gains, and copyrights.
- Automatic data validation The system checks for errors and compliance with tax regulations before submission.
Income Categories Subject to Withholding Tax
According to Law no. 29/2023 “For Income Tax, withholding tax applies to the following categories:
- Dividends – 8% tax on distributed profit.
- Interested – 15% for income from bank deposits, loans, and bonds.
- The fee – 15% for copyrights, licenses, and consulting services.
- Recitation – 15% when the payer is a NUIS-registered entity and the landlord is an individual.
- Gambling revenue – 15% on the winnings paid to players.
- Income from board memberships – 15% on compensation for board members.
- Payments for intellectual property – 15% on income from licenses, patents, and trademarks.
How to Fill Out the Declaration?
The declaration includes two main sections:
- Payments to taxpayers resident or with a permanent establishment in Albania Data can be automatically populated for subjects registered in the tax system.
- Payments to non-residents Manual filling of the beneficiary's name, country of residence, and identification number is required.
Payers must include the payment date, gross amount, and tax withheld for each payment. The e-Filing system will automatically calculate the tax based on rates set by law.
Delivery Deadlines and Non-Declaration Penalties
The declaration must be submitted by the 20th of the month following the tax period.
Late penalties are:
- 5,000 lek for taxpayers who are not subject to corporate income tax.
- 10,000 leks for taxpayers subject to this tax.
- Late payment penalty –If the tax is not paid by the deadline, daily interest will be applied to the outstanding amount.
Practical Example
To better understand the implementation of the new statement, let's look at an example:
XYZ Consulting Company made the following payments during January 2025:
| Type of income | Shuma Bruto | Tax and Customs Law | Withholding Tax |
|---|---|---|---|
| Dividend | 1,000,000 | 8% | 80,000 |
| Interest in loan | 500,000 | 15% | 75,000 |
| Consulting fees | 300,000 | 15% | 45,000 |
| Office chair | 100,000 | 15% | 15,000 |
| Board participation | 200,000 | 15% | 30,000 |
| Total tax withheld | 245,000 |
If this company does not submit the declaration by February 20, 2025, it will be subject to a late penalty and interest on the unpaid amount.
Download guide.
For more details on the changes and completion of the statement, read the full guide here: https://alprofitconsult.al/tatimi-i-mbajtur-ne-burim-cfare-ndryshon-nga-janari-2025/