North Macedonia tax system 2026 Individuals and companies planning to establish a business, invest, employ personnel or purchase real estate in North Macedonia should assess the country's tax framework before undertaking any transaction. The Macedonia Tax system includes personal income tax, corporate income tax, mandatory social security contributions, value added tax, withholding tax, customs duties, excise duties and local taxes. The Macedonia Tax system is essential for understanding the financial obligations in North Macedonia.
This article was prepared using the North Macedonia Tax Card 2025 as its initial technical framework and has been supplemented with official information published by the North Macedonian Public Revenue Office, Ministry of Finance, Customs Administration and Directorate for Technological Industrial Development Zones for 2026.
Tax rates, monetary thresholds, temporary measures and administrative practices may change. The applicable position should therefore be confirmed before a company is established, an investment is made, personnel are employed or a real estate transaction is completed.
Key 2026 Tax Figures at a Glance
| Tax or obligation | 2026 rate or threshold |
| Personal income tax | 10% generally; 15% for games of chance |
| Monthly personal tax allowance | MKD 10,932 |
| Annual personal tax allowance | MKD 131,184 |
| Corporate income tax | 10% |
| Optional annual tax on total revenue | 1% for qualifying companies with MKD 3,000,001-6,000,000 annual revenue |
| General withholding tax | 10%, subject to applicable tax treaties |
| Standard VAT | 18% |
| Preferential VAT | 10% and 5%, depending on the supply |
| Mandatory VAT registration threshold | Over MKD 2,000,000 taxable turnover |
| Total mandatory social contributions | 28% of the applicable gross contribution base |
| Property tax | 0.1%-0.2% |
| Property transfer tax | 2%-4% |
For businesses, understanding the Macedonia Tax system is vital for compliance and effective financial planning.
Contents
The Macedonia Tax system plays a crucial role in attracting foreign investment by providing a clear fiscal framework.
Understanding the Macedonia Tax system
- Taxation of Individuals
- Corporate Taxation
- Indirect Taxation
- Local and Other Taxes
- North Macedonia Tax Calendar
- Administrative Penalties
- Key Considerations for Foreign Investors
- LegalBalkan Legal Services in North Macedonia
- Frequently Asked Questions
- Legal Disclaimer and Sources
1. Taxation of Individuals
Understanding the Macedonia Tax system is essential for effective tax planning and ensuring compliance with local regulations.
1.1 Personal Income Tax
North Macedonia generally applies a flat personal income tax rate of 10%. The rate applies to employment income, income from independent activity, royalties and related rights, industrial property rights, rent and sub-rent, capital income, capital gains, insurance income and other taxable income. Winnings from games of chance are subject to a 15% rate under the current Ministry of Finance overview.
A progressive personal income tax system was introduced in 2019, but the country subsequently returned to flat taxation. The flat 10% rate remains the central feature of personal income taxation in 2026.
1.1.1 Personal Tax Allowance for 2026
For 2026, individuals receiving employment income benefit from a monthly personal tax allowance of MKD 10,932. The corresponding annual personal tax allowance is MKD 131,184. These amounts are taken into account when calculating personal income tax on employment income.
| Allowance | 2026 amount |
| Monthly personal tax allowance | MKD 10,932 |
| Annual personal tax allowance | MKD 131,184 |
1.1.2 Deductible Amounts
Mandatory social security contributions relating to employment income are deducted when determining the taxable salary base. The applicable personal tax allowance is also taken into account in the salary tax calculation.
| Deduction type | Deductible amount |
| Mandatory social security contributions on employment income | Full applicable amount |
| Monthly personal tax allowance for 2026 | MKD 10,932 |
1.2 Capital Gains and Savings Interest
Capital gains arising from the sale of securities, certain movable assets and intangible property are generally taxed at 10%, subject to the exemptions and calculation rules contained in the Personal Income Tax Law.
Taxation of interest on savings has been deferred until North Macedonia's accession to the European Union. The tax treatment of a particular deposit, security or capital transaction should nevertheless be reviewed according to the exact legal nature of the income.
1.3 Mandatory Social Security Contributions
Mandatory social security contributions are calculated by the employer, withheld from the employee's gross salary and paid on behalf of the employee. Unless a special law provides otherwise, the employer does not generally pay a separate contribution on top of the agreed gross salary.
For salary calculations relating to January through December 2026, the published national average monthly gross salary used for contribution-base purposes is MKD 69,141. The minimum contribution base is MKD 34,570, equal to 50% of that average. The maximum contribution base for employment income and certain management remuneration is MKD 1,106,256, equal to sixteen average gross salaries.
Contribution Rates from January to June 2026
| Contribution type | Rate |
| Mandatory pension and disability insurance | 18.8% |
| Mandatory health insurance | 7.5% |
| Additional health contribution for occupational injury and disease | 0.5% |
| Unemployment insurance | 1.2% |
| Total | 28.0% |
Contribution Rates from July to December 2026
A new allocation of the mandatory contribution rates applies from salary payments for July 2026 through December 2026. Although the composition changed, the combined rate remained 28.0%.
| Contribution type | Rate |
| Mandatory pension and disability insurance | 19.9% |
| Mandatory health insurance | 7.5% |
| Additional health contribution for occupational injury and disease | 0.5% |
| Unemployment insurance | 0.1% |
| Total | 28.0% |
| Important payroll point Payroll systems and employment-cost calculations should use the contribution allocation applicable to the salary month being paid. The July 2026 change affects the distribution between pension and unemployment contributions even though the overall contribution burden remains 28%. |
The 2025 source publication also states that certain non-employment income paid by a legal entity to an individual under a service agreement may be subject only to personal income tax. Because the legal classification of an agreement can affect tax and contribution obligations, each consultancy, management or service arrangement should be reviewed separately.
1.4 Annual Personal Income Tax Return
The Public Revenue Office prepares a draft annual personal income tax return for the taxpayer and delivers it no later than 30 April of the following year. The taxpayer must review the draft and confirm or correct it by 31 May.
If the taxpayer does not take the required action within the statutory period, the draft may be treated as confirmed and final. Individuals should therefore verify that income, tax prepayments and personal data shown in the draft return are complete and accurate.
2. Corporate Taxation
2.1 Corporate Income Tax
The corporate income tax rate in North Macedonia is 10%. Resident legal entities and permanent establishments of foreign legal entities are generally taxed on profits generated through business activities in North Macedonia, subject to the applicable residence and source rules.
The taxable base is generally the accounting profit determined as the difference between total revenue and total expenses, adjusted for non-deductible expenses and other tax adjustments required by law.
2.1.1 Simplified Tax Regime for Small Companies
Small and micro companies with annual total revenue up to MKD 3,000,000 may be exempt from corporate income tax under the simplified regime. Companies with annual revenue from MKD 3,000,001 to MKD 6,000,000 may elect to pay an annual tax on total revenue at a rate of 1% instead of the standard 10% corporate income tax, provided that the statutory requirements are met.
| Election and eligibility The simplified regime is not automatically suitable for every company. Revenue level, related-party transactions, business model, deductible costs and filing obligations should be reviewed before the company elects the 1% total-revenue regime. |
2.1.2 Non-Deductible Expenses
Expenses that are not necessary for the company's ordinary business activity, exceed statutory limits or are not recognized under tax rules may be added back to the corporate income tax base.
The Macedonia Tax system's flat rates simplify the taxation process, making it appealing for new businesses.
| Expense type | Non-deductible amount |
| Expenses unrelated to the ordinary course of business | 100% |
| Employee allowances exceeding statutory limits | 100% |
| Board members' expenses or allowances exceeding statutory limits | 100% |
| Hidden profit distributions | 100% |
| Representation expenses | 90% |
| Donation expenses exceeding 5% of annual turnover | 100% of the excess |
| Sponsorship expenses exceeding 3% of annual turnover | 100% of the excess |
| Interest on loans not used for the company's principal business activity | 100% |
| Insurance premiums paid for board members and employees | 100% |
| Penalties and interest for late payments to public authorities | 100% |
| Inventory shortages | 100% |
| Difference between transfer prices and arm's-length prices in related-party transactions | 100% |
Transfer pricing is particularly important where a North Macedonian company trades with a foreign shareholder, parent company, subsidiary or other related party. Agreements involving goods, services, financing, licensing, management support or intellectual property should be reviewed under the arm's-length principle.
2.1.3 Exempt Companies and Investment Incentives
Certain taxpayers may qualify for exemptions or incentives subject to specific statutory conditions. The source publication identifies companies employing persons with disabilities, business units operating within correctional institutions and qualifying users of Technological Industrial Development Zones.
Qualifying users of Technological Industrial Development Zones may receive an exemption from personal income tax and profit tax for up to ten years as part of an approved state-aid package. Eligibility, duration and the exact benefit depend on the applicable zone legislation, investment agreement and state-aid approval.
2.2 Capital Gains of Companies
Capital gains earned by companies are generally treated as ordinary corporate income and are taxed under the same rules as other business profits. Gains from the sale of real estate, shares, securities or other corporate assets may therefore be included in the taxable base at the standard 10% rate, subject to specific exemptions and adjustments.
2.3 Withholding Tax
Payments made to foreign legal entities may be subject to withholding tax at 10% of gross income. A lower or zero rate may apply under an applicable double taxation treaty if the recipient satisfies the residence, beneficial ownership and documentary requirements.
The categories of income potentially subject to withholding tax include:
- Dividends and other profit distributions;
- Interest;
- Royalties and licence fees;
- Entertainment and sporting activities performed in North Macedonia;
- Management, consulting, financial and research and development services;
- Certain insurance and reinsurance premiums;
- Certain international telecommunications services; and
- Income from leasing real estate located in North Macedonia.
Cross-border payments between Turkey and North Macedonia, or between North Macedonia and another jurisdiction, should be reviewed under both domestic legislation and the relevant double taxation treaty before payment is made.
3. Indirect Taxation
3.1 Value Added Tax
The supply of goods, provision of services and importation of goods into North Macedonia are generally subject to value added tax. The applicable rate depends on the nature of the supply, the status of the parties and any special or temporary rule in force at the date of the transaction.
3.1.1 VAT Registration Threshold
Mandatory VAT registration generally applies where taxable turnover exceeds MKD 2,000,000 in the preceding calendar year, is expected to exceed that amount when an activity begins, or exceeds the threshold during the year. Businesses below the threshold may choose voluntary registration.
3.1.2 VAT Rates
| VAT category | Indicative scope | Rate |
| Standard VAT | General taxable supplies and imports not covered by a preferential rule | 18% |
| Preferential VAT | On-site food and beverage services and catering, excluding alcoholic beverages; household electricity; and specified energy products | 10% |
| Preferential VAT | Specified food products, publications, water, agricultural inputs, computers and software, certain thermal solar systems, passenger transport, accommodation and other listed supplies | 5% |
| First sale of qualifying newly built residential property | First supply within the statutory period and subject to residential-use conditions; extended through 31 December 2028 | 5% |
The exact VAT classification should be confirmed by reference to the current law and implementing decisions. Product descriptions used in commercial documents do not always determine the tax rate; tariff classification, technical characteristics and the legal nature of the service may be decisive.
3.1.3 VAT Periods and Deadlines
VAT taxpayers are classified as monthly or quarterly taxpayers. VAT returns and payments are due within 25 days after the end of the relevant tax period.
| VAT taxpayer | Filing and payment deadline |
| Monthly taxpayer | 25th day of the following month |
| Quarterly taxpayer | 25 April, 25 July, 25 October and 25 January for the previous quarter |
3.2 Customs Duties
Goods imported into North Macedonia may be subject to customs duties calculated on the customs value, increased by related costs where required. Preferential or zero rates may apply under trade agreements and origin rules.
From 1 July 2026, North Macedonia introduced additional reductions and further alignment with European Union customs rates for 70 categories of industrial raw materials and intermediate goods used by domestic industry. The effect on a particular import depends on its tariff code, customs value, origin and the preferential arrangement claimed.
Companies exporting from Turkey or another country should confirm the customs tariff code, origin documentation, preferential treatment and import requirements before shipment.
3.3 Excise Duties
Excise duties apply principally to alcohol and alcoholic beverages, tobacco products, energy products and electricity. The Customs Administration is the competent authority for excise administration and control.
Excise amounts and exemptions vary by product, quantity and use and may change frequently. Importers and manufacturers should verify the rate and unit of measurement in force on the date of production, import or release for consumption.
4. Local and Other Taxes
4.1 Property Tax
Property tax is a municipal tax generally imposed at a rate between 0.1% and 0.2%. The tax base is the market value of the property determined under the prescribed municipal valuation methodology.
4.2 Property Transfer Tax
Property transfer tax generally ranges from 2% to 4%, depending on the municipality. The seller is ordinarily the statutory taxpayer, although the parties may agree that the buyer bears the tax if permitted by the applicable rules and reflected in the agreement. The tax base is generally the market value of the property.
4.3 Inheritance and Gift Tax
| Relationship | Indicative rate |
| First-degree relatives | 0% |
| Second-degree relatives | 2%-3% |
| Third-degree relatives or unrelated persons | 4%-5% |
The exact rate is determined by the competent municipality and the tax base is generally the market value of the inherited or gifted property.
5. North Macedonia Tax Calendar
The following table summarizes the principal recurring deadlines relevant to companies and individuals. Where a statutory deadline falls on a non-working day, the operational deadline may move to the next working day under the applicable procedural rules.
| Obligation | General deadline |
| Quarterly VAT return and payment | 25 April, 25 July, 25 October and 25 January for the previous quarter |
| Monthly VAT return and payment | 25th day of the following month |
| Monthly MPIN gross salary calculation | 10th day of the following month |
| Gross salary payment, including tax and contributions | 15th day of the following month |
| Monthly corporate income tax advance | 15th day of each month |
| Corporate income tax return and electronic annual accounts | Generally 15 March for the previous year when filed electronically |
| Payment of final corporate income tax difference | Generally within 30 days after the annual-account filing deadline |
| Draft annual personal income tax return issued by the tax authority | No later than 30 April of the following year |
| Confirmation or correction of draft personal income tax return | 31 May of the following year |
| Compliance calendar Companies should maintain a coordinated calendar covering VAT, payroll, social security contributions, corporate tax advances, annual accounts, withholding-tax reports and any sector-specific customs or excise obligations. |
6. Administrative Penalties
The source publication provides indicative penalty amounts and notes that actual fines may depend on a coefficient-based formula and the circumstances of the infringement. The current law should be checked before relying on the figures below.
| Non-compliance | Indicative penalty stated in the source publication |
| Late submission of a VAT return | EUR 1,500 for the company and EUR 500 for the responsible person |
| Failure to submit a VAT return | EUR 2,500 for the company and EUR 1,000 for the responsible person |
| Late submission or failure to submit a corporate income tax return | EUR 2,000-3,000 for the company and EUR 500-1,000 for the responsible person |
Tax non-compliance may create exposure for both the company and its director or other responsible person. Late filings, inaccurate declarations, unpaid tax and missing documentation should therefore be addressed promptly.
7. Key Considerations for Foreign Investors
North Macedonia's 10% personal and corporate income tax rates, VAT framework, investment-zone incentives and geographic position may be attractive to foreign investors. However, an investment decision should not be based on headline rates alone.
The following matters should be reviewed together:
- The legal form and tax residence of the company;
- Eligibility for the simplified 1% total-revenue regime;
- The tax residence and ownership structure of shareholders;
- Dividend, interest, royalty and service payments to non-residents;
- Application of double taxation treaties;
- Transfer pricing and related-party documentation;
- Employment contracts, payroll and social security costs;
- VAT registration, invoicing and input-tax recovery;
- Customs classification, origin and preferential tariff treatment;
- Ownership and transfer of real estate;
- Eligibility for TIDZ or other investment incentives; and
- Tax-return, annual-account and payment deadlines.
Tax, corporate, immigration, employment and contractual planning should be carried out as a single coordinated process. A structure that appears efficient from a corporate perspective may create avoidable withholding, VAT, transfer-pricing or residence risks if the tax consequences are considered only after incorporation.
8. LegalBalkan Legal Services in North Macedonia
LegalBalkan provides coordinated cross-border legal support to individuals, entrepreneurs and companies planning to establish a business, invest, employ personnel, acquire real estate or complete another legal transaction in North Macedonia.
Our services include:
- Company formation and corporate registration;
- Preparation of articles of association and corporate documents;
- Share transfers, shareholder arrangements and corporate restructuring;
- Residence and work permit applications;
- Legal due diligence for real estate acquisitions;
- Review of title, encumbrances and property records;
- Drafting and review of commercial agreements;
- Employment and labour law advice;
- Debt recovery and enforcement coordination;
- Notarial, apostille and legal translation procedures;
- Recognition and enforcement of foreign court judgments; and
- Coordination with local lawyers, accountants, notaries and other professionals.
Our turnkey and one-stop legal service model enables clients to manage multi-stage and cross-border matters through a single point of contact. Each matter is assessed individually and handled through a tailor-made, technology-supported and solution-driven approach.
9. Frequently Asked Questions
Companies engaging with the Macedonia Tax system must stay informed about changes and updates.
What is the personal income tax rate in North Macedonia in 2026?
The general personal income tax rate is 10%. Winnings from games of chance are subject to a 15% rate under the current Ministry of Finance overview.
What is the personal tax allowance for 2026?
The monthly allowance is MKD 10,932 and the annual allowance is MKD 131,184.
What is the corporate income tax rate?
The impact of the Macedonia Tax system on foreign investments cannot be overstated, as it determines the overall business climate.
The standard corporate income tax rate is 10%. Qualifying small companies may be exempt or may elect a 1% tax on total revenue, depending on annual revenue and statutory conditions.
What is the VAT registration threshold?
Mandatory VAT registration generally applies when taxable turnover exceeds MKD 2,000,000.
What are the VAT rates?
The standard rate is 18%. Preferential rates of 10% and 5% apply to specific goods and services.
Did social security contribution rates change in 2026?
Yes. The allocation changed from July 2026: pension and disability insurance increased to 19.9%, while unemployment insurance decreased to 0.1%. The total combined rate remained 28%.
What is the property tax rate?
Property tax generally ranges from 0.1% to 0.2% of the assessed market value, depending on the municipality.
Are tax incentives available in free economic zones?
Qualifying users of Technological Industrial Development Zones may receive profit-tax and personal-income-tax exemptions for up to ten years, subject to zone legislation and state-aid approval.
10. Legal Disclaimer and Sources
This article is intended solely for general informational purposes. It does not constitute legal, tax, accounting, customs or investment advice and does not create an attorney-client relationship.
The article uses the North Macedonia Tax Card 2025 as an initial source and updates it with official information available in 2026. Tax rates, contribution allocations, thresholds, temporary VAT measures, customs tariffs, filing deadlines and administrative practices can change. A specific transaction should be reviewed under the legislation and official guidance in force on the relevant date.
The indicative administrative penalties reproduced from the source publication have not been presented as definitive 2026 fines. The applicable misdemeanor and tax-procedure rules should be checked in each case.
For comprehensive legal support navigating the Macedonia Tax system, LegalBalkan is available to assist.
This overview of the Macedonia Tax system should assist stakeholders in navigating their tax responsibilities effectively.
By comprehensively understanding the Macedonia Tax system, investors can strategize effectively for the best outcomes.
Each company's interaction with the Macedonia Tax system will differ based on its unique circumstances and needs.
Ultimately, the Macedonia Tax system aims to create a fair and efficient economic environment for all stakeholders.
The stability of the Macedonia Tax system is a key factor in maintaining investor confidence in the region.
Investors should carefully consider how the Macedonia Tax system aligns with their overall business strategy.
The implications of the Macedonia Tax system on profitability must be analyzed regularly.
Businesses thrive when they fully comprehend the nuances of the Macedonia Tax system.
The evolving nature of the Macedonia Tax system presents both challenges and opportunities for businesses.
Stakeholders should remain vigilant regarding any changes to the Macedonia Tax system that may affect their operations.
Engagement with the Macedonia Tax system is critical for sustainable business growth in North Macedonia.
Understanding the implications of the Macedonia Tax system on your business model can lead to better financial outcomes.
An informed approach to the Macedonia Tax system can empower businesses to leverage existing opportunities.