Tax in Albania

Who is the tax authority?

Albania's national tax authority is the Drejtoria e Pergjithshme e Tatimeve (DPT — General Directorate of Taxation), operating under the Ministry of Finance and Economy. Filings flow through the e-Tax portal at tatime.gov.al. The Albanian Institute of Authorized Chartered Accountants (IEKA — Instituti i Eksperteve Kontabel te Autorizuar) sets professional standards for licensed accountants.

Customs administration sits with the Drejtoria e Pergjithshme e Doganave (General Directorate of Customs), separate from DPT. Substantive law rests on Income Tax Law 29/2023 (effective 1 January 2024), VAT Law 92/2014, and the Tax Procedure Law. Albania is an EU accession candidate — negotiations opened 19 July 2022 under the Stabilisation and Association Agreement (SAA) framework.

What is the tax year and when are returns due?

Albania's tax year matches the calendar year (1 January to 31 December). Wage income tax is withheld monthly by employers.

Who counts as an Albanian tax resident?

Under Income Tax Law 29/2023 (Article 7), an individual is tax resident in Albania if any of three criteria are met. These are: (a) maintaining a permanent residence in Albania, OR (b) being physically present in Albania for 183 or more days in any 12-month period, OR (c) being an Albanian state employee posted abroad.

Residents pay tax on worldwide income. Non-residents pay tax only on Albanian-source income. The center-of-vital-interests test — permanent home and domicile — provides a secondary tie-breaker when two conditions overlap.

Deep-dive: see expat and cross-border tax in Albania for the practical rules around moving in or out mid-year.

What are the personal income tax rates?

Tatim mbi te Ardhurat Personale (TAP — personal income tax) uses a two-bracket progressive structure introduced under Income Tax Law 29/2023:

Investment income (dividends, interest) is subject to an 8% withholding tax as a final tax. Capital gains on disposal of assets are taxed at 15%. Social insurance contributions add further charges on employment income.

How does corporate tax work?

Tatim Fitimi (corporate income tax) applies to resident and non-resident companies on Albanian-source profits. Albania uses a tiered rate structure based on company size and sector.

The Strategic Investment Status incentive gives qualifying projects (above EUR 30 million) approximately a 50% CIT reduction. TEDA (Technology and Economic Development Areas) function as free-zone equivalents — companies operating inside a TEDA benefit from favourable CIT and customs arrangements.

Withholding on dividends to non-residents is 8% (treaty rates apply). Tax losses carry forward for 5 years. Albania has not yet transposed the OECD Pillar Two global minimum tax — EU-candidate alignment is expected as accession advances.

Deep-dive: see small business tax in Albania for how the ALL 14 million threshold and the reduced 5% rate interact.

What about VAT and other indirect taxes?

Tatimi mbi Vleren e Shtuar (TVSH — value added tax) is Albania's main indirect tax. The standard rate is 20% under VAT Law 92/2014.

VAT registration becomes mandatory once annual turnover exceeds ALL 10 million. Below that threshold, registration is voluntary. Monthly VAT returns are due by the 14th of the following month. Albania operates reverse-charge B2B rules for cross-border services received from non-resident suppliers — the Albanian recipient accounts for TVSH rather than the foreign provider.

EU OSS-equivalent rules apply for digital services supplied to Albanian consumers by foreign providers. Albania is progressively aligning VAT rules with the EU VAT Directive as part of accession preparations.

How are cryptoassets taxed?

Albania adopted dedicated cryptoasset legislation through Law 66/2020 "On Financial Markets Based on Distributed Ledger Technology", which established CASP (Crypto Asset Service Provider) licensing under the Albanian Financial Supervisory Authority (AMF — Autoriteti i Mbikqyrjes Financiare).

Deep-dive: see crypto taxation in Albania for the full AMF-CASP licensing requirements.

What is the treaty network?

Albania has approximately 45 active bilateral double-tax agreements (DTAs). Albania signed the OECD Multilateral Instrument (MLI) in 2017 and ratified it — the MLI modifies existing treaties where both signatories have included the relevant provisions. Major treaty partners include the United States, Italy, Greece, Germany, Switzerland, Austria, France, Netherlands, China, Russia, Turkey, Kosovo, North Macedonia, and the United Kingdom.

Albania's MLI ratification means treaty modifications (principal purpose test, dispute resolution) are active against other MLI-signatory partners. The standard statute of limitations for tax audits is 5 years, extended for fraud.

Deep-dive: see tax treaty relief in Albania for the bilateral rate schedules.

Where does Albania sit in the regional cohort?

Albania anchors the Western Balkans EU-candidate cohort alongside Kosovo, North Macedonia, Montenegro, Serbia, and Bosnia-Herzegovina. The broader regional landscape splits into 5 distinct tax archetypes:

Common pitfalls and penalties

Foreign companies and individuals encounter several recurring traps when operating in Albania:

When should you talk to an Albanian tax professional?

Some situations are straightforward enough for the DPT e-Tax portal. Others get complex fast:

• Income regularly exceeds ALL 200,000 per month and crosses between the 13% and 23% bands
• Operating as a business near or above the ALL 14 million SME turnover threshold
• Applying for Strategic Investment Status or setting up inside a TEDA free-zone area
• Receiving cross-border dividend, interest, or royalty payments — treaty eligibility needs verification
• Moving into or out of Albania mid-year, particularly where multiple countries are involved
• Dealing with cryptoasset disposals or CASP-licensing questions under Law 66/2020
• Received a DPT notice of assessment, audit letter, or penalty notice
• Unsure whether TVSH registration applies to cross-border digital-services supply

Look for a licensed Kontabel i Autorizuar (Authorized Accountant) credentialed by IEKA, or a qualified Tax-Adviser registered with the Albanian Bar or relevant professional body. A directory of vetted Albanian practitioners is available below.

This page contains general information about Albania's tax system. It is not personal guidance for any specific situation. Tax rules change frequently. Always verify current figures on the DPT website (tatime.gov.al) or with a licensed Albanian practitioner before filing.