Macedonia has signed several double taxation agreements (DTA or DTT) with countries worldwide and continues to develop the economic relations with other states too. Avoiding the double taxation of profits in Macedonia is the main goal of DTTs. Our company formation representatives in Macedonia can offer foreigners the needed support at the time of company incorporation in Macedonia and can also provide tax advice on request.
| Quick Facts | |
|---|---|
| What are double tax treaties? | DTTs in Macedonia are bilateral agreements created to avoid double taxation on income earned in two countries. |
|
Number of double tax treaties |
Over 50 DTTs signed in Macedonia |
|
Purpose of DTTs in Macedonia |
-prevent double taxation, -encourage foreign investment. |
| Main benefit | Tax relief or exemption to avoid being taxed twice on the same income. |
| DTTs in Macedonia with EU countries |
Yes, including Germany, France, Austria, Italy, etc. |
| Withholding tax rate |
10% applied on incomes payable abroad, such as: dividends, interest, royalties, income from entertainment/sporting activities, etc. |
| Types of income covered |
-dividends, -royalties, -capital gains, -pensions, -employment income. |
| Tax residency requirement |
Must be a tax resident of Macedonia or of the other treaty country in order to benefit. |
| Double tax treaties benefits for foreign entities |
Lower withholding tax rates and relief on taxable income. |
| Tax relief on capital gains | Available under most DTTs, often allocated to the country of residence. |
| Claiming DTT benefits |
Requires residency certificate and compliance with local legislation procedures. |
| Exemptions on dividends |
Yes, partial or full exemption, based on the specific treaty. |
| Domestic tax laws vs. DTT |
DTTs override domestic law in case of conflict. |
| DTTs and cross-border business |
DTTs facilitate trade and investments by providing tax clarity. |
| Assistance | Our Macedonian company formation agents can offer more details about DDTs in Macedonia. |
Table of Contents
The countries which signed double tax treaties with Macedonia
The Republic of Macedonia signed , up to 2025, 49 double taxation agreements with the following countries: Albania, Austria, Azerbaijan, Belarus, Belgium, Bosnia and Herzegovina, Bulgaria, China (People’s Republic of), Chinese Taipei (Taiwan), Croatia, Czech Republic, Denmark, Egypt, Estonia, Finland, France, Germany, Hungary, India, Iran, Ireland, Israel, Italy, Kazakhstan, Kosovo, Kuwait, Latvia, Lithuania, Luxembourg, Moldova, Morocco, Netherlands, Norway, Poland, Qatar, Romania, Russia, Saudi Arabia, Montenegro, Serbia, Slovakia, Slovenia, Spain, Sweden, Turkey, Ukraine, United Arab Emirates, United Kingdom, Vietnam.
Likewise, Macedonia entered into several free trade agreements with countries like: Liechtenstein, Switzerland, Iceland, Norway, Serbia, Montenegro, Kosovo, Albania, Bosnia and Herzegovina. The Macedonian authorities are currently developing the investment protection treaties which involve a wide range of countries which are conducting trades and investment processes in Macedonia. In certain cases, these are the same countries for which a double taxation treaty has already been signed. Such agreements intend to protect the foreign investors and their assets on the Macedonian market.
The main provisions of tax treaties signed by Macedonia
The double taxation agreements in Macedonia regulate the taxation of incomes, dividends, interests, capital, and royalties for foreign companies with establishments in this country, and mention the conditions through which these provisions are applied. The following information is important to foreign investors in Macedonia:
• the withholding taxes are lower for a signatory country, and in particular circumstances, they are not imposed on interests, royalties, and dividends.
• the income tax is set at 10% or lower, depending if the company has non-resident shareholders from a state which signed a tax treaty with Macedonia;
• in some cases, the income tax may involve a 15% rate;
• if such provisions are not mentioned in a treaty, a Tax Exchange Information Agreement can be signed.
Who can benefit from the double tax treaties signed with Macedonia?
All investors with origins from the above-mentioned countries, who would like to set up a company in Macedonia, regardless of the type of business, can take advantage from the provisions of the double taxation agreements signed by Macedonia. The main condition is to have company establishments in this country as a foreign investor.
What is a permanent establishment?
Any office, branch, workshop, factory or building considered a fixed place for business in Macedonia is called a permanent establishment. In other words, your business office or any related property through which the activities are carried can be considered permanent establishments. We remind that the Articles of Association comprise information about the business address of your firm in Macedonia.
Do natural persons benefit from DDTs?
Yes, individuals living and working in Macedonia are exempt from a double taxation on their registered revenues. Our team of company formation consultants in Macedonia can provide you with complete information about this matter.
Tax residency in Macedonia
To benefit from the double tax treaties in Macedonia fully, it is important to understand the concept used in Macedonia regarding tax residency. The main requirement for establishing tax residency in Macedonia follows the 183-day rule, which is recognized in many countries around the globe. This way, foreigners who reside in Macedonia for at least 183 days in a one-year period can be generally considered Macedonian tax residents and, automatically, can benefit from the DTTs signed by the Macedonian authorities.
Our Macedonian company formation specialists can assist with additional support regarding DTTs in Macedonia, tax residency requirements and more.
We invite you to observe the main aspects of tax residency in Macedonia:
The OECD model tax convention
The double taxation agreements signed by Macedonia follow the Organization for Economic Cooperation and Development (OECD) model tax convention. OECD represents an international organization what has the reponsibility to promote strategies that improve the economic situation of individuals around the world. To take full advantages of the double tax conventions and their endowments, the foreign taxpayers need to offer a binding proof that the taxes are already paid in the home country. In this sense, a valid certificate of a taxpayer is normally issued by the foreign tax authorities and then registered with the financial authorities in Macedonia.
Short facts about the taxation system of Macedonia
The VAT and the corporate income tax are the most important taxes in Macedonia and here are a few details about the taxes that need to be paid in this country:
- 10% represents the corporate income tax in Macedonia and it is one of the lowest in Europe. This is quite an advantage for local and foreign investors who want to start their operations in Macedonia. Companies with establishments in Macedonia must pay the corporate income tax.
- 18% is the standard VAT rate in Macedonia and it is imposed on most products and services available for sale purposes. A lower VAT of 5% rate applies to: water supply, medical equipment, agricultural materials, accommodation services, publications, and more.
- A flat 10% rate represents the income tax in Macedonia for royalties, dividends, and interests. The double taxation agreements signed by Macedonia mention the withholding tax and the protection of paying this tax twice.
- The real estate tax in Macedonia is imposed on properties and ranges between 0.1% and 0.2%, there are also: the municipal fees, the transfer tax, and the communal taxes.
The taxation system in Macedonia is quite advantageous from a business point of view and it is appreciated by local and foreign entrepreneurs who what to start their operations and benefit from stability from this point of view. Those interested in more details about the tax structure in Macedonia can get in touch with our company formation specialists in Macedonia who can also offer assistance for tax registration in this country.
The withholding tax mentioned by the DDTs signed by Macedonia
As mentioned earlier, the income tax in Macedonia is set at a 10% rate and it is mentioned by the double taxation treaties signed by this country with other states. The withholding tax is imposed on: royalties, interests and dividends, incomes derived from entertainment activities, financial services, management and consulting services, telecommunication, lease of immovable properties. The interest on bank deposits opened in Macedonia, on governmental bonds or transactions in state securities involving international markets are not subject to withholding tax. Please feel free to talk to our specialists and find out more about this important tax in Macedonia.
Exceptions of withholding tax with other countries
If the standard income tax is set at a 10% rate, there are also exceptions or a lower rate mentioned by the DTT signed with Macedonia. For instance, the double tax treaty signed with Azerbaijan mentions that the withholding income tax has a 8% rate imposed on: royalties, dividends, and interests. In the case of Estonia, such tax is set at a 5% rate or even exempted under certain conditions. As for France, the Netherlands, and in some cases Luxembourg, there is no withholding tax. More about the tax exemptions stipulated by the double taxation agreements signed by Macedonia with countries worldwide can be discussed with one of our company formation agents in Macedonia. Our team can also help you register a company in Macedonia.
Public Revenue Office’s role in Macedonian DDTs
Public Revenue Office in Macedonia (PRO), part of the Ministry of Finance, represents the regulatory mechanism of this country in order to ensure the fulfillment of tax obligations by individuals and legal entities. Regarding double tax treaties in Macedonia, PRO is also the regulatory body who ensures signing of international treaties and maintaining a fair tax system in this country. For instance, according to the provisions of the Article 21 of the Law on Corporate Income Tax published in the Official Gazzete of Republic of Macedonia, No 112/14…232/19, the withheld tax is calculated on the gross income at the rate of 10% on the territory of Macedonia. This way, if a foreign company which is receiving income from Macedonia and it is also a tax resident of a country that has a double taxation avoidance agreement with North Macedonia, then the tax rate applied to that income cannot be higher than the rate set in the agreement.
Making investments in Macedonia
Macedonia is quite advantageous from an investment point of view because the country offers many business opportunities to both domestic and international investors who want to thrive in this part of Europe. The strategic geographic location, the booming economy, the fast company incorporation process, support and benefits for reinvested profits, and a great taxation system are solid pluses in the business environment in Macedonia, and representative in the investment sector that aims the foreign entrepreneurs. The experienced workforce of Macedonia is another benefit to international entrepreneurs who relocate their operations and businesses in this country.
Data on Macedonia’s economy
As official data is mentioned by the World Bank, Macedonia is presenting an interesting direction regarding economics and development of businesses:
- In 2024, the Gross Domestic Product (GDP) in Macedonia was worth 16.69 billion US dollars;
- The GDP value of Macedonia is representing 0.02% of the world economy value;
- In March 2025, the GDP growth rate in Macedonia was 0.60%.
If you want to establish your business presence on the Macedonian market and if you want to know more about the taxation structure before registering a company in Macedonia, we suggest you contact our company incorporation agents in Macedonia.