{"id":15454,"date":"2022-10-08T18:35:44","date_gmt":"2022-10-08T18:35:44","guid":{"rendered":"https:\/\/alprofitconsult.al\/?page_id=15454"},"modified":"2024-11-30T13:58:00","modified_gmt":"2024-11-30T13:58:00","slug":"income-tax","status":"publish","type":"page","link":"https:\/\/alprofitconsult.al\/en\/tatime\/sipermarres\/te-veprosh-si-nje-biznes\/tatimi-mbi-te-ardhurat\/","title":{"rendered":"Income Tax"},"content":{"rendered":"
Home Page<\/a><\/span> | Tax legislation<\/a><\/span> | Entrepreneur<\/a><\/span> | Act as a business<\/a><\/span> | Income Tax<\/span><\/span><\/div>\n\n\n

<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

<\/p>\n\n\n\n

\n

The following information is valid and applicable until December 31, 2023, following the entry into force of the new Law No. 29\/2023<\/a> On Income Tax. Please browse our website for more details and updated information at: https:\/\/alprofitconsult.al\/tatime\/<\/a><\/p>\n<\/blockquote>\n\n\n\n

Scope of application<\/h2>\n\n\n\n

Profit limitations are subject to:<\/p>\n\n\n\n

    \n
  1. Legal entities and partnerships with income above 8,000,000 ALL per year<\/li>\n\n\n\n
  2. Legal entities, as well as other partnerships of persons established or organized under a foreign law and operating within the territory of the Republic of Albania;<\/li>\n\n\n\n
  3. Any other person, regardless of their status or legal form of registration or recognition, except in cases where that person is subject to simplified business profit tax for small businesses.<\/li>\n<\/ol>\n\n\n\n
    \n

    Notice: Any person, regardless of their status or legal form of registration or recognition, when they become subject to profit tax, has the right to request deregistration at any time, but may not switch to the simplified small business profit tax regime.<\/p>\n<\/blockquote>\n\n\n\n

    The obligation to pay profit tax<\/h4>\n\n\n\n

    Resident taxpayers are subject to tax on profits earned from all sources, both within and outside the territory of the Republic of Albania.<\/p>\n\n\n\n

    Exemption from profit tax<\/h4>\n\n\n\n

    Excluded from income tax are central and local government bodies, the Bank of Albania, humanitarian associations, international organizations, when provided for by special agreements, enterprises provided for in international agreements ratified by the Assembly, foundations or non-bank financial institutions established or transferred by a Council of Ministers' decision, film production companies subsidized by the National Center of Cinematography, and the administered voluntary pension fund.<\/p>\n\n\n\n

    \n

    Notice: All of the above-mentioned entities are required to submit their tax return and annual balance sheet to the tax authorities within the same deadlines as entities subject to income tax.<\/p>\n<\/blockquote>\n\n\n\n

    Accommodation structures \u201c4 and 5-Star Hotels\/Resorts (Special Status)<\/a>\u201d, as defined in tourism legislation and that are holders of a registered and internationally recognized trademark\u201cBrand name<\/em>\u201dExempt from income tax for a 10-year period are those structures that obtain special status until December 2024. The effects of the exemption begin at the time the accommodation structure commences its economic activity, but no later than three years after obtaining special status.<\/p>\n\n\n\n

    Taxable income<\/h2>\n\n\n\n

    Taxable profit results from the difference between gross income earned during the tax period (calendar year) and recognized expenses.<\/p>\n\n\n\n

    The taxable profit for the tax period is determined based on the balance sheet and its annexes, which must have been prepared in accordance with the law.\u201cFor accounting and financial statements<\/a>\u201d.<\/p>\n\n\n\n

    Revenue<\/h4>\n\n\n\n

    Gross income means all types of income earned during the tax period and includes, but is not limited to, income earned from the supply of goods and services, income from participations, interest income, and income from the use of movable and immovable property.<\/p>\n\n\n\n

    Expenditures<\/h4>\n\n\n\n

    Deductible expenses<\/h5>\n\n\n\n

    For expenses to be recognized (deductible), they must meet these conditions:<\/p>\n\n\n\n

      \n
    1. to be performed in the direct interest of the enterprise's economic activity;<\/li>\n\n\n\n
    2. to be performed effectively;<\/li>\n\n\n\n
    3. to be reflected through an accounting entry by decreasing net assets;<\/li>\n\n\n\n
    4. to be proven with the relevant legal justification documentation.<\/li>\n<\/ol>\n\n\n\n
      Unknown expenses (deductible)<\/h5>\n\n\n\n

      For the purpose of determining taxable income, expenses that the Income Tax Law has specified in an exhaustive list are not recognized. For more information, refer to the Law No. 8438 \u201cOn Income Tax\u201d<\/a>, Article 21, which you can find below.<\/p>\n\n\n\n

      Tax Rates<\/h4>\n\n\n\n

      The profit tax rate is:
      a) 0% for taxpayers with income up to 14,000,000 lek per year.
      b) 15% for taxpayers with annual income over 14,000,000 lek.<\/p><\/blockquote><\/figure>\n\n\n\n

      The rate of the profit tax is 5 % per:<\/p>\n\n\n\n