The following information is valid and applicable until December 31, 2023, following the entry into force of the new Law No. 29/2023 On Income Tax. Please browse our website for more details and updated information at: https://alprofitconsult.al/tatime/
The annual income statement is completed by the individual who has the obligation to declare.
An individual who is obliged to complete and submit the individual annual personal income tax return has the right to appoint their legal representative by proxy to complete or submit their declaration.
The representative of the declaring individual is a person chosen by them to represent them in tax matters. The individual's representative assumes the rights and obligations of the individual, and the tax administration is obliged to cooperate and operate with them.
The appointment of a representative does not relieve the declaring individual from tax liability. They remain legally responsible for fulfilling their tax obligations. The fact that the individual's representative may make a mistake in declaring and paying tax obligations does not relieve the latter from responsibility for the error.
To identify yourself as a taxpayer with the fiscal code of a resident individual, use the personal identification number on their identity card. For a non-resident individual, use the personal identification number on the non-resident individual's identity card.
The statement contains data on:
The individual annual income declaration form model is approved by instruction from the Minister of Finance. Below you will find the approved model of the declaration (Form D1 and D2):
The first part of the statement notes the tax period related to the calendar year in which the individual earned income, as well as their identification data. The second part presents the data that enables the calculation of the tax, as follows.
Gross income from wages or remuneration from employment relationships for individuals is completed for the total wages and remuneration that the declarant receives from all employment relationships during the tax period.
Gross income from dividends from participation in commercial companies or from business activities will be supplemented, for the amount of the dividend the declarant benefits, from all their participations in commercial companies or business activities.
Gross rental income will be completed for the total gross income an individual realizes from renting out one or more properties.
Clarification:
In the case of leasing between two individuals, the income recipient is obliged to declare and pay tax to the relevant tax authority at a rate of 15% of the income earned, no later than the 20th of the month following the month in which the payment was made. The form for this purpose is Declaration of Income Tax from Other Sources
Capital gains from the sale of real estate (land, building) owned by the declarant will be completed for realized capital gains.
The sale value of the immovable property is determined in the notarized sales contract, which is signed by the parties (seller and buyer).
Capital gain is equal to the difference between the selling price and the purchase price of the real estate.
Gross income from bank interest will be completed with the total income from bank interest that the individual has earned during the tax period.
Net capital gains generated from investments in securities or real estate will be accounted for against the total of realized gains from investments in securities, stock sales, and real estate, excluding land and buildings.
The term “realized capital gain” refers to the difference between the selling price and the purchase price of an asset.
In the case of selling shares, the taxable value is the difference between the revenue from selling the shares and the nominal or purchase value of the shares.
Gross winnings from lotteries or other gambling games will be completed for the total gross winnings from lotteries or other gambling games.
Gross income from intellectual property, licenses, exclusive rights, and other assets consisting solely of rights and having no physical form, shall be completed for the total gross income from all, as described above.
Capital gains from donations will be supplemented by the amount of capital gains realized from the donation. In cases of transfer of ownership through donation, the transaction is considered taxable and for the purpose of calculating the tax liability, the procedure will be as in the case of transfer of ownership, land and building, through a sales contract.
Gross income earned outside the territory of the Republic of Albania shall be completed for the total gross income earned outside the territory of the Republic of Albania.
Other gross income not mentioned above, will be added to the total other gross income, which is not included in the income mentioned above.
The amount of bank interest on a loan taken for education for oneself, children, or dependents will be covered by the bank for the amount of bank interest on the loan taken for education, within the territory of the Republic of Albania.
Expenses for personal medical treatment, or for children and dependants, not covered by mandatory health insurance, will be reimbursed based on invoices issued by healthcare institutions within the territory of the Republic of Albania, for the justification of medical expenses, in accordance with the provisions of subordinate legislation.
The taxable income sum is calculated for the difference between:
gross income, with
Total deductible expenses.
The sum of the tax is calculated, which results from the multiplication of:
taxable income, with
tax bracket 15%.
Special statement categories are filled out with:
Tax overpaid from the previous year and not reimbursed is completed for the sum of tax overpaid from the previous year and resulting in non-reimbursement as of the declaration date.
Reimbursement request, completed for the amount requested for reimbursement.
Overpaid tax (for reimbursement) is completed for the difference if the tax paid during the tax period is greater than the tax calculated according to the declaration. .
The mandatory tax to be paid is calculated on the difference between:
the amount of tax calculated according to the declaration, minus
the amount of tax paid,
minus
3. Overpaid and unreimbursed taxes from the previous year.
Delivery for the form D1 – Annual Individual Income Declaration the form D2 – Annual Individual Income Declaration for Foreign Individuals is achieved through the electronic form and is available on the official website of General Directorate of Taxes.
Resident and non-resident individuals, subject to declaration, submit the annual income tax return to the central tax administration, no later than April 30, In the year following the tax period for which the declaration is made.
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