{"id":20821,"date":"2025-02-09T23:24:58","date_gmt":"2025-02-09T23:24:58","guid":{"rendered":"https:\/\/alprofitconsult.al\/?p=20821"},"modified":"2025-02-09T23:24:59","modified_gmt":"2025-02-09T23:24:59","slug":"withholding-tax-as-of-january-2025","status":"publish","type":"post","link":"https:\/\/alprofitconsult.al\/en\/tatimi-i-mbajtur-ne-burim-cfare-ndryshon-nga-janari-2025\/","title":{"rendered":"Withholding Tax: What Changes from January 2025?"},"content":{"rendered":"

Withholding Tax Declaration for the period beginning from January 2025<\/a> there will be some important changes compared to the previous version. In addition to a more analytical format, the statement includes detailed information about each payment and tax withheld. <\/p>\n\n\n\n

Through this guide, the aim is to provide a clear and practical description of how to fill out the declaration, the categories of income subject to withholding tax, and a practical example to help taxpayers comply with their tax obligations.<\/p>\n\n\n\n

Responsibilities of the Tax Withholding Agent<\/h2>\n\n\n\n

The withholding tax agent is any entity that makes income payments that, according to Law no. 29\/2023 \u201cOn Income Tax\u201d<\/a> are subject to withholding tax. The agent's main responsibilities include withholding tax at the time of payment, accurately calculating the amount, and transferring it to the relevant tax administration accounts within the specified deadlines.<\/p>\n\n\n\n

The withholding tax declaration must be submitted through the e-Filing electronic system by the 20th of the month following the tax period. For each payment, the declaration must include data on the beneficiary, the type of income, the gross amount, and the tax withheld. If the beneficiary is a non-resident, it is mandatory to specify their country of residence and attach a residence certificate, when required.<\/p>\n\n\n\n

\n

If the obligations for withholding and remitting tax are not met in a timely or accurate manner, the tax agent faces penalties, including fines and interest for late payment, which are clearly defined by law and relevant guidelines.<\/p>\n<\/blockquote>\n\n\n\n

Income Categories for Which Withholding Tax is Applicable<\/h2>\n\n\n\n

According to article 58 of Law no. 29\/2023<\/a>, withholding at source applies to several main categories of income. These categories are detailed below:<\/p>\n\n\n\n

Dividends<\/h3>\n\n\n\n

Dividends include any distribution of profit approved by the statutory bodies of a company. The tax on dividends is 8%% and is withheld at the time of payment or at the end of the third month after the decision to distribute profits. For example, for a profit distribution of 1,000,000 lek, the tax withheld is 80,000 lek.<\/p>\n\n\n\n

Interested<\/h3>\n\n\n\n

Interest income includes not only bank interest but also interest paid on loans granted by individuals or entities. For banks and financial institutions, the statement is presented with the total value of payments. For this income, the tax rate is 15%.<\/p>\n\n\n\n

The fee<\/h3>\n\n\n\n

The honorarium includes income from copyrights, licenses, and trademarks. For this income, the tax is 15%. A payment of 300,000 ALL for a consulting service would have a tax withheld of 45,000 ALL.<\/p>\n\n\n\n

Recitation<\/h3>\n\n\n\n

The withholding tax on rent is 15%% and applies when the tenant is a subject with NUIS, while the landlord is an individual. For example, for a monthly rent of 100,000 lek\u00eb, the tax withheld is 15,000 lek\u00eb.<\/p>\n\n\n\n

Gambling Revenue<\/h3>\n\n\n\n

Gambling organizers withhold tax on any winnings paid out to players. The rate is 15%, and the tax is considered final for the player.<\/p>\n\n\n\n

Completion of the Withholding Tax Statement<\/h2>\n\n\n\n

The new Withholding Tax declaration comes into effect from January 2025 and has a new, more detailed, and analytical format. This declaration includes every type of income subject to withholding tax, including full details about the income beneficiary, type of income, gross amount, payment date, and tax withheld. Accurate completion of the declaration is important to avoid errors and penalties that may arise from incorrect or late submissions.<\/p>\n\n\n\n

The declaration is divided into two main sections:<\/p>\n\n\n\n