Taxes in Kosovo – What You Need to Know

Understanding the tax system in Kosovo is essential for businesses to operate legally and efficiently. Whether you’re a startup, small business, or large corporation, knowing your tax obligations helps you avoid penalties and optimize your financial planning. 

This guide covers the main types of taxes in Kosovo, including corporate tax, VAT, personal income tax, and other financial obligations. 

corporate income tax

Corporate Income Tax (CIT) applies to all registered businesses operating in Kosovo. The standard CIT rate is 10% on net profit, making it one of the lowest in the region. 

📌 Tip: Businesses earning close to €30,000 should carefully plan their tax strategy to avoid surprises when crossing the threshold.

✅ Who Needs to Pay?

  • All businesses generating profits in Kosovo.
  • Companies registered as LLCs, joint-stock companies, and partnerships.
  • Foreign businesses operating in Kosovo under local tax regulations.

✅ Tax Payment Schedule:
CIT must be reported annually, with payments due by March 31st of the following year. Businesses must also make quarterly advance payments based on estimated earnings.

✅ Small Business Tax (for Businesses Under €30,000 Revenue)
If a business earns less than €30,000 per year, it may be subject to a presumptive tax instead of standard CIT. This means taxes are calculated based on turnover rather than net profit.

Value-Added Tax (VAT)

Value-Added Tax (VAT) applies to goods and services sold in Kosovo. It is one of the main tax obligations for businesses.

📌 Tip: VAT-registered businesses can deduct input VAT (the VAT paid on business expenses) from their VAT liability, reducing the overall tax burden.

✅ VAT Rates in Kosovo:

  • 18% (Standard Rate): Applies to most goods and services.
  • 8% (Reduced Rate): Applies to basic food products, pharmaceuticals, books, and some public services.

✅ Who Needs to Register for VAT?

  • Any business with annual revenues exceeding €30,000 must register for VAT.
  • Voluntary registration is possible for businesses with lower revenue that want to claim VAT deductions.

✅ VAT Filing & Deadlines:

  • VAT returns must be filed monthly.
  • Payments are due by the 15th of the following month.

Personal Income Tax (PIT)

Value-Added Tax (VAT) applies to goods and services sold in Kosovo. It is one of the main tax obligations for businesses.

📌 Tip: VAT-registered businesses can deduct input VAT (the VAT paid on business expenses) from their VAT liability, reducing the overall tax burden.

✅ VAT Rates in Kosovo:

  • 18% (Standard Rate): Applies to most goods and services.
  • 8% (Reduced Rate): Applies to basic food products, pharmaceuticals, books, and some public services.

✅ Who Needs to Register for VAT?

  • Any business with annual revenues exceeding €30,000 must register for VAT.
  • Voluntary registration is possible for businesses with lower revenue that want to claim VAT deductions.

✅ VAT Filing & Deadlines:

  • VAT returns must be filed monthly.
  • Payments are due by the 15th of the following month.