Business Taxation in AlbaniaCorporate Tax, VAT, Payroll and Compliance

Business taxation in Albania involves more than the headline corporate tax rate. The right tax treatment depends on what the business does, how much it earns, whom it pays, where it operates and how its owners take money out.

A company may qualify for 0% income tax and still have VAT, payroll, withholding and municipal obligations. A foreign-owned business may be fully taxable in Albania even if all its customers are abroad. And an expense recorded in the accounts is not necessarily deductible for tax purposes.

This guide brings together the principal taxes and compliance requirements affecting Albanian companies, sole traders and international businesses operating in Albania. It covers ordinary business operations and identifies the additional rules that apply to particular sectors, assets and transactions. Amounts are stated in Albanian lek, abbreviated ALL; currency conversions should not be used to test statutory thresholds.

1. Albania’s business taxes at a glance

Income Tax Law; VAT Law and implementing decision; contributions legislation; Local and National Tax Laws: [1]–[4], [6]–[10].

2. Who is taxable in Albania?

Albanian companies and foreign ownership

An entity is resident under Albanian domestic law if it is established in Albania or its management and control are exercised in Albania under the statutory tests. Resident entities are generally taxable on their worldwide taxable income. A company incorporated abroad can therefore require an Albanian residence analysis if its actual management is conducted from Albania.

Foreign ownership does not, by itself, create a special corporate tax rate. An Albanian limited liability company (sh.p.k.) owned by UK, EU or US investors generally enters the same domestic tax framework as an Albanian-owned company. The shareholders’ residence can, however, affect dividend withholding, treaty access and taxation in their home jurisdiction.

Branches, projects and permanent establishments

A non-resident business may be taxable on income attributable to an Albanian permanent establishment and on other Albanian-source income. A branch is an obvious case, but a permanent establishment can arise from the actual activities even without registering a branch first. Offices, construction or installation projects, services and certain agency arrangements require particular attention.

The domestic permanent-establishment definition contains activity-specific conditions and time tests. An applicable tax treaty may modify the result. A single “183-day rule” is not a reliable answer for every business, project or employee. Review the contract, the people on the ground, the premises used, decision-making authority and the expected duration before operations begin.

Company or sole trader?

A sole trader is taxed under the personal business-income rules; a company is a separate entity subject to corporate rules. Money withdrawn by a sole trader is not a company dividend. Conversely, a shareholder cannot treat an sh.p.k. bank account as a personal account merely because they own all its shares. Liability, financing, profit extraction and compliance should be considered together when choosing a structure.

Law No. 29/2023, Articles 2–5, 27–28: [1].

3. Corporate income tax: from accounts to taxable profit

The standard corporate income-tax rate is 15%. It applies to taxable profit, rather than every amount entering the business bank account. Taxable profit starts from the relevant accounting results and is adjusted under the Income Tax Law. Income recognition, deductible expenses, depreciation, financing, related-party transactions and carried-forward losses can all change the final figure.

Capital contributions and genuine loan principal should be distinguished from trading revenue. Customer advances, long-term contracts, foreign-exchange differences and disposals need their own accounting and tax treatment; a bank-statement-only calculation will often be wrong.

What expenses can be deducted?

An expense must satisfy the business-purpose and documentation requirements and must not fall within a statutory exclusion or limit. A fiscalised invoice is important evidence, but does not make a fictitious, private or otherwise disallowed expense deductible.

• Personal spending and dividends: private expenditure of shareholders, administrators or their families and dividends are not ordinary deductible operating costs.
• Capital expenditure: the purchase of a lasting business asset normally requires capitalisation and the applicable tax depreciation, rather than immediate deduction of its full cost.
• Penalties and provisions: public-law fines and penalties are disallowed. Accounting provisions are not automatically deductible.
• Representation and hospitality: the general deductibility ceiling is 0.3% of annual income, with a specific rule for qualifying export-oriented businesses’ documented participation in overseas fairs and exhibitions.
• Foreign consultancy, technical and management services: the law links deductibility to payment by the tax-return deadline; where payment occurs later, deduction is generally deferred to the payment year. Evidence of the actual service remains necessary.
• Payroll and cash payments: salaries must meet the prescribed banking or licensed electronic-money payment requirements. Cash payments above statutory limits can also lose deductibility.

Sponsorships, employee insurance, private pension contributions, bad debts and stock losses have their own conditions. These should be reviewed before the year-end return, when obtaining missing evidence or correcting payment arrangements may be more difficult.

Depreciation and financing

The principal annual tax depreciation rates are 5% for qualifying buildings and long-life installations, 15% for intangible assets, 25% for computers, information systems, software and data-storage equipment, and 20% for other business assets. Classification, the statutory depreciation base and the period of use matter. Land is not depreciable, and staff passenger cars are subject to additional restrictions.

Financing costs also require a separate check. Article 30 restricts excess interest deductions by reference to 30% of tax EBITDA, subject to its definitions and exceptions, with a five-year carry-forward mechanism. Article 50 contains a separate interest-rate restriction. A shareholder loan must additionally be genuine, properly documented and priced on an arm’s-length basis where required.

Tax losses

Under the current regime, tax losses arising from 2024 onwards may generally be carried forward against taxable profits of the following five years, using earlier losses first. The law restricts utilisation where an ownership change exceeding 50% is accompanied by a change of activity. A buyer acquiring a loss-making company should therefore not assume that the historic losses will remain available.

Law No. 29/2023, Articles 30, 41–54 and 69(3); General Instruction No. 26: [1] [2].

4. Small businesses and the self-employed

The ALL 14 million relief

Article 69 provides a transitional 0% income-tax rate through 31 December 2029 for eligible individual traders, self-employed persons and entities with annual gross income up to ALL 14 million. The threshold concerns gross income, not the profit remaining after expenses.

This is not permission to stop keeping records or filing returns. Nor does it remove VAT, social and health contributions, withholding obligations, local taxes or tax on a company’s dividend distributions. Eligibility must be assessed for the relevant taxpayer and year, including the correct classification of income.

If a company exceeds the relief threshold, it should not assume that 15% applies only to revenue above ALL 14 million. The normal corporate rule taxes the company’s taxable profit. The separate progressive bands for sole traders are different again.

Normal business-income rates for individuals

Outside applicable relief, taxable net business income of individual traders and self-employed persons is subject to 15% on the first ALL 14 million of annual taxable profit and 23% on the excess. Here, ALL 14 million is a taxable-profit band; it must not be confused with the annual gross-income threshold for the transitional 0% regime.

When self-employment may be treated as employment

Article 12 includes rules for a self-employed person deriving 80% or more of their income from one client, or 90% or more from fewer than three clients. The current text also provides a substantiated self-employed-status declaration mechanism and a specific exception for qualifying services supplied only to non-residents without an Albanian permanent establishment.

Those provisions should be read together. Concentration of income, the actual working relationship and the available evidence matter. Replacing an employment contract with invoices does not, by itself, settle the tax classification. Businesses engaging individual contractors should review both the contract and how the work is actually performed.

Law No. 29/2023, Articles 12, 24(2) and 69(1)(dh), consolidated text: [1].

5. VAT: registration, rates and recovery

Registration is a separate test

The general VAT registration threshold applying during 2026 is ALL 10 million. Decision No. 953 expresses the threshold by reference to calendar-year turnover, while Article 122 of the VAT Law requires monitoring turnover over 12 consecutive months and applying for registration within 15 days of crossing the statutory threshold. The law identifies the crossing date by reference to the end of the relevant calendar month. New businesses also need to consider the proportionate-turnover rule in Article 119.

In practical terms, maintain a monthly threshold calculation rather than waiting for the annual accounts. The turnover included for VAT is defined by the VAT Law and is not necessarily identical to every accounting-income figure.

The threshold is not universal. Notaries and state and private bailiffs have a zero registration threshold under the implementing decision. Imports, supplies by non-established businesses and special regimes can create additional obligations. Voluntary registration under the rules applying in 2026 is available where annual turnover exceeds ALL 5 million; the election carries minimum-duration and exit rules.

The rates are not limited to 20% and 6%

The current standard rate is 20%. A 6% rate applies to specified supplies, including qualifying accommodation, certain services within special-status five-star hotels or resorts, certified agrotourism accommodation and restaurant services excluding beverages, audiovisual advertising and books. Other narrowly defined categories include qualifying electric public-transport buses and specified sports-infrastructure construction.

A separate 10% rate applies to specified agricultural inputs, including qualifying fertilisers, pesticides, seeds and seedlings, subject to the statutory classification and exclusions. A business must identify the exact supply and eligibility conditions; a sector label alone does not justify a reduced rate.

Zero-rated, exempt and outside the scope are different

Qualifying exports and specified international supplies may be zero-rated, with input-tax recovery subject to the law. Exempt supplies—such as specified financial, insurance, healthcare, education and property transactions—often restrict recovery of related input VAT. A service whose place of supply is outside Albania is a different category again.

For international services, identify whether the customer is a business, where it is established and whether a special rule applies. Services connected with land, events, transport and electronically supplied services can depart from the general rule. A foreign address on an invoice does not automatically establish the VAT treatment.

Purchases of services from overseas can require the Albanian recipient to account for VAT under the reverse-charge mechanism. Imported software, advertising and consultancy therefore deserve review even where the foreign supplier does not charge Albanian VAT.

Input VAT and refunds

Recoverable input VAT normally reduces output VAT payable, provided the business has the required documentation and the purchase supports qualifying activities. Private use, exempt activities, restricted expenditure, defective invoices and mixed-use assets can limit deduction. A capital purchase or building project may also require later adjustments if its use changes.

A credit balance is not an automatic cash refund. Under the general rule, a refund request requires a credit carried for three consecutive months and an amount exceeding ALL 400,000. Qualifying exporters have a separate route without that general three-month condition. Requests remain subject to the applicable procedures and verification.

VAT Law No. 92/2014, Articles 24–30, 48–77 and 117–122; Decision No. 953, Article 11; Decision No. 822/2026: [3]–[5].

6. Employment tax and social contributions

Hiring creates three distinct calculations: employment income tax, the employee’s contributions withheld from pay, and the employer’s own contributions added to employment cost. Employment registration, accurate remuneration records and timely payroll declarations are separate obligations.

Employment income tax

Current annual taxable employment income is taxed progressively at 13% up to ALL 2,040,000 and 23% on the excess, after applicable allowances. These are taxable-base bands, not a flat percentage applied indiscriminately to gross salary.

The standard personal allowance depends on income: ALL 600,000 annually for income up to ALL 600,000; ALL 420,000 for income above ALL 600,000 up to ALL 720,000; and ALL 360,000 for income above ALL 720,000. The corresponding monthly amounts are ALL 50,000, ALL 35,000 and ALL 30,000 within the relevant monthly income ranges. A valid personal-status declaration is important, and the same monthly allowance cannot be claimed twice with different employers.

Child and eligible education deductions are subject to separate conditions and annual-return procedures. Multiple employment, other taxable income or income not fully covered by withholding can create an individual annual filing obligation even where the employer has correctly operated payroll.

Social and health contributions in 2026

For an ordinary employee, the employer pays 15% social insurance and 1.7% health insurance; the employee bears 9.5% and 1.7% respectively. The combined employer and employee rates are therefore 16.7% and 11.2% only where the same salary base applies to both components.

From 1 January 2026, the standard minimum monthly base is ALL 50,000 and the maximum monthly social-insurance base is ALL 186,416. Health contributions are calculated on gross pay without that social-insurance ceiling, subject to the minimum and applicable exceptions. Above the social ceiling, multiplying the entire gross salary by 16.7% or 11.2% overstates the ordinary combined contributions.

Self-employed persons have a different framework: ordinary non-agricultural self-employment involves social contributions at 23% on the applicable base and health contributions at 3.4% of twice the minimum wage. Using the 2026 minimum gives ALL 11,500 social plus ALL 3,400 health, or ALL 14,900 monthly, before any special status or exception. Company administrators should not automatically be treated as sole traders for this purpose.

Foreign nationality does not automatically remove Albanian payroll or contribution obligations. Treaty employment provisions and social-security coordination agreements are separate instruments, each with its own conditions and documentary requirements.

Income Tax Law, Articles 12–13, 22–24 and 65; Decision No. 77, as amended; Tax Administration’s 2026 contribution-base notice: [1] [6] [7].

7. Dividends, rent and other withholding taxes

Dividends

The current domestic dividend-tax rate is 8%. The distributing company ordinarily withholds and remits the tax unless a qualifying exemption or treaty changes the treatment. The dividend is a distribution of company profits, not a deductible cost of earning them.

Before payment, the company must establish that the profits can lawfully be distributed, adopt the required decision and satisfy the applicable solvency and other company-law requirements. A bank balance alone is insufficient. For qualifying corporate recipients, Article 29 provides a participation exemption built around a minimum 10% holding and an uninterrupted 24-month period, with further conditions and a guarantee mechanism in specified cases. It should not be assumed to exempt every payment to a foreign parent.

Declared but unpaid dividends also require attention. Current Article 56 sets a specific deadline for transferring the tax by the end of the third month following the month of the distribution decision. Deferring the shareholder’s cash receipt does not postpone withholding indefinitely.

Other payments

The general domestic withholding rate for other payments within Article 58 is 15%. Relevant categories include interest and royalties; rent paid to individuals; and specified payments to non-residents without an Albanian permanent establishment, including certain service, insurance, management, construction and other payments.

Not every supplier invoice is subject to withholding. For example, an ordinary payment to a resident company for its trading services is different from rent paid to an individual landlord. For foreign services, the statutory category, source rules, the exception for services physically received outside Albania, and any applicable treaty must be tested against the facts.

Review whether the contract price is gross or net of withholding. A promise that a foreign supplier will receive a fixed net amount can leave the Albanian customer bearing additional tax through a gross-up. VAT reverse charge and withholding tax may both require analysis on the same payment; one does not replace the other.

Further reading: Dividends in Albania: current rules and the proposed increase to 15%.

Income Tax Law, Articles 29, 41, 50 and 56–59; Companies Law, particularly Articles 76–81: [1] [2] [12].

8. Cross-border taxation and related parties

Treaties and foreign tax credits

An applicable double-tax treaty may limit Albania’s taxing rights, reduce withholding or resolve competing residence claims. Relief requires the correct treaty, qualifying residence and the relevant substantive and procedural conditions. A residence certificate is important evidence, but it does not by itself establish every requirement, such as beneficial ownership or the absence of a permanent establishment.

Resident taxpayers may obtain credit for qualifying foreign income tax, subject to proof and statutory limits. This does not mean that every foreign tax is fully refundable in Albania. The timing, income category and Albanian tax attributable to the same income need to be reconciled.

Investors should also check the home-country treatment of an Albanian subsidiary, dividends, loans and management activities. Incorporating an Albanian company does not automatically end a founder’s personal tax residence elsewhere. EU directives should not be assumed to apply directly to an Albanian company simply because its owner is established in an EU Member State.

Transfer pricing

Related-party transactions must satisfy the arm’s-length principle. Management charges, financing, intellectual-property licences, shared staff, procurement and intra-group goods transactions should be supported by contracts, evidence of performance and a defensible pricing method.

Instruction No. 29 requires the annual controlled-transactions notification where the relevant transactions, including loan balances, exceed ALL 50 million in aggregate. The notification follows the annual profit-tax return deadline. Transactions below that reporting threshold are not thereby exempt from the arm’s-length requirement.

The law also requires transfer-pricing information to be made available within 45 days of a request. Documentation should therefore be prepared while the transactions and comparables can still be evidenced. Larger international groups should separately assess any country-by-country reporting and other group-specific obligations.

Reorganisations and asset disposals

A share sale, asset sale, merger, liquidation or migration of business functions can produce different tax outcomes. Gains, loss utilisation, VAT adjustments, withholding and the treatment of transferred liabilities must be modelled before signing. The Income Tax Law also contains special ownership-change rules for certain natural-resource, telecommunications and financial-sector entities. A transaction presented commercially as a simple share transfer may therefore need a wider tax review.

Income Tax Law, Articles 2–5, 25, 31–39, 42, 44, 46–47 and 54–55; Transfer Pricing Instruction No. 29, paragraphs 14–15: [1] [11].

9. Property, municipal and national taxes

Central tax registration does not exhaust a business’s obligations. The premises, municipality, signage, vehicles and regulated activities can generate separate taxes and charges. Some are payable by the business directly; others are collected through suppliers or designated agents.

A lease should identify who bears a charge commercially, but a contractual allocation does not automatically change who is liable to the authority. Keep the municipal taxpayer record, property details, activity classification and payment evidence consistent with the actual business.

Law No. 9632/2006 on Local Taxes, including Articles 9, 20–28 and the schedules; Law No. 9975/2008 on National Taxes, as amended: [9] [10].

10. Imports, customs duties and excise

An importer should calculate the landed cost before agreeing a purchase price. The customs classification, customs value, origin of the goods and applicable customs procedure determine the duty treatment. Import VAT is a separate charge, generally at the rate applicable to the corresponding domestic supply, unless an exemption or special arrangement applies.

Preferential treatment under a free-trade agreement depends on qualifying origin and the required proof. Buying goods from an EU distributor does not necessarily make those goods EU-originating. Freight, insurance, royalties or other adjustments can also affect customs value under the relevant rules.

Excise is another layer for specified products, notably certain energy products, alcohol and tobacco. Classification, quantities, authorisations, guarantees, tax stamps and warehouse or suspension arrangements can matter as much as the rate itself. Producers and importers should use the current product schedule, rather than a single percentage assumed to cover all excisable goods.

Customs duty, excise and import VAT should also be distinguished in the accounts. Recoverable import VAT is different from a non-recoverable cost; eligibility for recovery requires the appropriate importer and customs documentation.

Albanian Customs’ official tariff, preferential-origin and excise materials; VAT Law, Articles 50, 56 and 69: [3] [15] [16].

11. Sector relief and special regimes

Tax incentives should be confirmed against the precise activity, certification, start date and statutory sunset. A favourable rate mentioned in an older investment brochure may no longer apply.

• Certified agrotourism: Article 69 preserves a 5% income-tax rate through 31 December 2029 for qualifying activity. VAT relief has separate conditions.
• Agricultural cooperation societies: qualifying entities under the relevant sector law benefit from the transitional 5% income-tax rate through 31 December 2029.
• Automotive industry: the qualifying 5% income-tax regime also runs through 31 December 2029.
• Special-status hotels and resorts: qualifying four- and five-star internationally branded structures can benefit from the statutory ten-year corporate tax exemption where special status is obtained within the current December 2026 deadline, with separate rules governing when the exemption starts.
• Software: the legacy 5% rate for qualifying pre-existing software producers or developers expired on 31 December 2025 under the current text. It should not be advertised as a general 2026 software-company rate. Other genuinely applicable relief, including the small-business regime, must be tested separately.

Travel-agency margin taxation, second-hand goods, agricultural VAT compensation, financial activities, economic-development zones, extractive operations and other regulated sectors can require specialist analysis beyond the ordinary trading-company calculation. The question is which specific regime applies, not which headline incentive sounds most favourable.

Fiscal peace and historic tax debt

Law No. 84/2025 establishes a voluntary fiscal-peace agreement for qualifying taxpayers. Its framework uses the previous year’s taxable profit increased by 18%, with the normal rate applying to that amount and a 5% rate to qualifying profit above it. Eligibility, application periods, exclusions and the agreement terms must be checked. It is not a general 5% corporate tax rate and does not remove VAT, payroll or other taxes.

Law No. 86/2025 separately addresses specified historic tax and customs liabilities through cancellation or conditional payment arrangements. It does not erase every debt or the principal of social and health contributions. A business with arrears should reconcile the affected periods and amounts against the law and its remaining deadlines before deciding how to settle or challenge a liability.

Income Tax Law, Article 69; VAT Law, special-regime chapters; Laws No. 84/2025 and No. 86/2025: [1] [3] [17] [18].

12. Fiscalisation, banking and records

A registered business needs a working compliance system from its first transaction. Confirm the tax responsibilities recorded against its NUIS/NIPT, access to e-Filing and SelfCare, the required electronic certificate and fiscalisation solution, registered business premises, invoice numbering and the responsible people.

Fiscalisation rules can apply even when the business is outside VAT. An ordinary PDF sent by email is not necessarily the legally required electronic invoice. Cash sales, non-cash business transactions, exports, imports, corrective invoices and self-billing must follow the relevant rules.

Review the electronically generated purchase and sales books, complete missing information and confirm accuracy by the statutory deadline. The existence of an automatically generated book does not remove responsibility for wrong VAT classifications, missing imports, duplicate invoices or unsupported deductions.

Cash limits and payment facilities

Under current Article 59 of the Tax Procedures Law, cash sale or purchase transactions between businesses must not exceed ALL 100,000. Transactions between a business and an individual are subject to a separate ALL 500,000 ceiling. The former ALL 150,000 business-to-business figure still appears in some older materials and should not be used for the current rule.

Cash-on-hand limits and the obligation to deposit excess cash are additional requirements. They should not be confused with the limit on an individual transaction. Companies and other covered taxpayers must maintain and declare a business bank account; the law provides a 20-calendar-day opening period for newly registered taxpayers within the relevant obligation.

Article 59/3 also introduces POS/POI terminal requirements for taxpayers making cash sales. Specified accommodation, transport and public-sector categories had a 30 May 2026 deadline; other covered taxpayers have a 31 December 2026 deadline, subject to the statutory exemptions. Businesses should check this before the year-end rather than treating card acceptance solely as a commercial preference.

A usable audit trail

Maintain accounts, invoices, contracts, bank records, payroll, customs declarations, inventories, asset registers, related-party evidence and tax submissions in a consistent archive. Apply the relevant tax and accounting retention periods and preserve records for unresolved disputes or longer statutory requirements. Stopping trading or changing accountants is not a reason to lose the historical records.

Law No. 87/2019, including Article 25; Law No. 9920/2008, Articles 57–59/3, as amended: [8] [19].

13. The core filing and payment calendar

Build the calendar around the tax responsibilities actually registered for the business. A return and a payment are different obligations: submitting a form does not mean the tax has been paid, and a bank transfer does not replace a return.

Income-tax instalments are based on statutory reference periods, with rules for new businesses and adjustments. A fall in activity should be addressed through the relevant adjustment procedure and evidence rather than by simply stopping payments.

A dormant or loss-making business may still have filing duties. Formal suspension, deregistration and liquidation require a controlled closure process, including final returns, stock and asset treatment, payroll and outstanding liabilities.

Income Tax Law, Articles 56–57 and 61–65; VAT Law, Articles 105–110; Fiscalisation Law, Article 25; Transfer Pricing Instruction, paragraph 14: [1] [3] [8] [11].

14. Two common business situations

A service company with ALL 8 million of annual gross income

Assume an Albanian company supplies ordinary domestic services, qualifies for Article 69 relief, has no special VAT-registration trigger and has not elected voluntary VAT registration. Its income-tax rate may be 0%, and during 2026 its turnover is below the general ALL 10 million VAT threshold.

It still needs compliant invoices, accounts and filings. Employing staff creates payroll and contribution duties. Renting an office from an individual can create withholding obligations. Distributing company profits can create dividend tax.

For 2027, the adopted ALL 5 million VAT threshold changes the planning position. The same level of business can remain within the income-tax relief threshold while falling within VAT registration. Pricing, margins, customer contracts and recoverable input VAT need to be reviewed together.

A company earning ALL 4 million of taxable profit

Assume annual gross income exceeds ALL 14 million, no special relief applies, accounting profit before tax equals taxable profit, and all after-tax profit is lawfully distributable to an individual shareholder. Ignore foreign tax and treaty relief for this illustration.

These examples explain the interaction of the rules. They should not be used to select a structure without examining the actual turnover, margins, shareholder position, spending and cash flow.

Tridens calculations based on current Articles 41, 59 and 69 and the deposited income-tax bill: [1] [13].

15. What is changing for 2027?

The legal status of each measure matters. An adopted Council of Ministers decision, a bill deposited in Parliament and a policy announcement are not interchangeable.

Practical preparation means mapping turnover, reviewing tax-inclusive prices, checking contracts spanning year-end, updating payroll scenarios and identifying shareholder balances. It does not mean accelerating distributions without a solvency review or assuming that a 2026 resolution secures the old rate for every later payment.

Decision No. 822/2026, Articles 1–4; deposited income-tax amendment bill, Articles 1, 3 and 5–8; Ministry of Finance presentation of the 2027 package: [5] [13] [14].

16. Reviews, assessments and disputes

Common risk areas include a mismatch between fiscalised sales and the accounts, unsupported management fees, shareholder withdrawals, incorrect VAT exemptions, undeclared employment, unreconciled imports and old tax-credit balances. A focused review should trace selected transactions from the contract through the invoice, bank payment, ledger and tax return.

If the administration issues an assessment or another appealable decision, the ordinary administrative appeal period is 30 calendar days from receipt or deemed receipt under Article 106. Admissibility generally requires payment of the disputed principal or the prescribed bank guarantee; Article 107 excludes the assessed penalties and calculated late-payment interest from that payment or guarantee amount.

Act promptly on electronic notices. Informal correspondence should not be assumed to preserve an appeal deadline. A defensible response requires the assessment, service evidence, accounting reconciliation, contracts and legal grounds to be assembled while there is still time to use the appropriate procedure.

Tax Procedures Law No. 9920/2008, particularly Articles 106–107: [19].

17. What businesses should do now

1. Confirm the tax profile. Check the entity type, residence, registered activities, tax responsibilities, business premises and any sector certification.
2. Track the right thresholds. Maintain separate calculations for income-tax relief, VAT registration and controlled-transactions reporting.
3. Review the 2027 transition. Identify the adopted VAT-threshold change separately from proposed rates and update budgets accordingly.
4. Test invoices and cross-border payments. Verify VAT classification, reverse charge, withholding, treaty documentation and contract gross-up clauses.
5. Reconcile payroll. Check the personal allowances, actual salaries, contribution bases, administrator status and registration records.
6. Review shareholder balances. Separate legitimate expenses, salary, loans, capital and dividends; prepare the necessary corporate documentation.
7. Build a complete calendar. Include monthly returns, annual tax, instalments, QKB and local obligations, plus event-driven filings.
8. Keep a review-ready evidence file. Preserve the records that explain the commercial transaction and its tax treatment, not just the final return.

18. Frequently asked questions

Related reading: Company formation costs in Albania · Accounting and compliance for foreign-owned companies.