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Montenegro property taxes range from 0.25% to 1% of your property's assessed value annually, with coastal properties often taxed at higher rates.
The exact amount you'll pay depends on your municipality, property type, and location, with foreign owners paying the same rates as Montenegrin citizens. Most residential properties in cities like Podgorica face annual tax bills between €250-€1,000 for a €100,000 apartment.
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Montenegro charges annual property tax between 0.25% and 1% of assessed property value, with payments due in two installments by June 30th and October 31st each year.
Foreign property owners pay identical rates to local citizens, while primary residence owners can receive up to 50% tax reductions based on family size.
| Property Type | Annual Tax Rate | Example: €100,000 Property |
|---|---|---|
| Residential Apartment (Podgorica) | 0.25% - 1% | €250 - €1,000 |
| Coastal Property (Kotor/Budva) | 0.5% - 1% | €500 - €1,000 |
| Commercial Property | Up to 5.5% | Up to €5,500 |
| Land (Residential) | 0.25% - 1% | €250 - €1,000 |
| Hotel/Tourist Property | Up to 5.5% | Up to €5,500 |
How much is the standard yearly property tax rate in Montenegro?
The standard yearly property tax rate in Montenegro ranges from 0.25% to 1% of your property's assessed market or cadastral value.
As of September 2025, most residential properties fall within this bracket, with municipalities setting their specific rate within this range. The exact percentage depends on your local municipality's budget needs and policy decisions.
For example, if you own a residential apartment valued at €100,000, your annual property tax will be between €250 and €1,000. This rate applies to the property's official assessed value as determined by the cadastral office, not necessarily what you paid for it.
Each municipality reviews and sets their rates annually, so your exact tax percentage may vary slightly from year to year within the allowable range.
Does the tax rate change depending on whether the property is residential, commercial, or land?
Yes, property tax rates vary significantly based on property type, with commercial and hotel properties facing much higher rates than residential properties.
Residential properties maintain the standard 0.25% to 1% rate, while commercial properties and hotels can be taxed up to 5.5% of their assessed value annually. This higher rate particularly affects large hotels in tourist and coastal areas.
Land used for residential purposes follows the same 0.25% to 1% rate as residential buildings. However, the calculation method may consider the land's specific category and intended use, which can affect the final assessment.
Agricultural land often receives preferential treatment with potential exemptions or reduced rates, depending on municipal policies and usage verification.
How is the property tax calculated in Montenegro, is it based on property value, size, or location?
Property tax in Montenegro is calculated primarily on your property's market or cadastral value as of January 1st each year.
The calculation considers several factors including location (coastal and premium areas typically receive higher assessments), year of construction or property age, and proximity to the sea or other desirable features. Properties in tourist hotspots like Kotor and Budva generally face higher valuations than similar properties in inland cities.
Some municipalities may calculate tax based on surface area (square meters) when market value data is unavailable, but this is less common. The specific percentage within the allowed 0.25% to 1% band is decided annually by local authorities based on their budget requirements.
Your municipal tax office reassesses property values periodically, and significant renovations or improvements may trigger a value reassessment that affects your annual tax bill.
What is the average yearly tax bill for an apartment in Podgorica?
For a typical apartment in Podgorica valued at €100,000, expect an annual property tax between €250 and €1,000.
Most Podgorica apartments fall in the middle range of this bracket, with actual bills often around €400 to €700 annually. The exact amount depends on the municipality's chosen rate for that year and any applicable reductions for primary residence.
A smaller apartment worth €60,000 would pay approximately €150 to €600 yearly, while a larger apartment valued at €150,000 might face annual taxes of €375 to €1,500. These calculations assume standard residential rates without special exemptions.
Podgorica residents living in their primary residence can receive up to 20% base reduction plus additional family-based reductions, potentially cutting the tax bill in half for eligible households.
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How much would the yearly tax be for a coastal property in Kotor or Budva?
Coastal properties in Kotor and Budva typically face higher property tax rates, often at the upper end of the 0.25% to 1% range.
For a €200,000 coastal apartment in these prime tourist destinations, annual property tax usually ranges from €500 to €2,000. Properties with direct sea views or located in historic old towns may face assessments at the maximum 1% rate due to their premium locations.
A €150,000 apartment near the coast might pay €750 to €1,500 annually, while luxury properties exceeding €300,000 in value could face tax bills of €1,500 to €3,000 per year. These higher rates reflect the premium value and tourist appeal of coastal locations.
Properties used for tourist rentals or commercial purposes in these areas may face even higher rates, potentially reaching the commercial property tax brackets if classified as business operations.
Are there different tax brackets or percentages depending on the municipality?
| Municipality Type | Typical Rate Range | Rate Adjustment Authority |
|---|---|---|
| Coastal Tourist Areas (Kotor, Budva, Herceg Novi) | 0.5% - 1% | Can increase basic rate by 25%-150% |
| Capital City (Podgorica) | 0.4% - 0.8% | Moderate adjustments based on city budget |
| Mountain/Inland Cities (Pljevlja, Nikšić) | 0.25% - 0.6% | Often use lower end of range |
| Rural Municipalities | 0.25% - 0.5% | Limited adjustment capacity |
| Special Economic Zones | Variable | May offer reduced rates for development |
Is there a minimum or maximum yearly property tax that owners should expect?
Montenegro does not set universal minimum or maximum amounts for residential property tax, as taxation is strictly proportional to assessed property value.
However, some municipalities establish small minimum annual tax amounts for administrative purposes, typically ranging from €20 to €50 per year regardless of property value. This ensures cost recovery for basic administrative processing.
For residential properties, the effective maximum is 1% of assessed value, meaning even the most expensive residential properties cannot exceed this rate. Commercial and hotel properties face higher maximums up to 5.5% of assessed value.
Properties with very low cadastral values (below €5,000) may receive complete exemptions in some municipalities, effectively creating a de facto minimum threshold for tax liability.
It's something we develop in our Montenegro property pack.
Do foreign property owners pay the same yearly tax rate as Montenegrin citizens?
Yes, foreign property owners pay exactly the same annual property tax rates as Montenegrin citizens with no additional surcharges or discriminatory taxation.
As of September 2025, Montenegro treats all property owners equally regardless of nationality for annual property tax purposes. Whether you're from the EU, United States, Russia, or any other country, you'll pay the identical rate applied to local citizens.
The only difference foreign owners might experience is in eligibility for certain exemptions. Primary residence reductions are typically available only to Montenegrin citizens who actually live in the property as their main residence.
Foreign owners should ensure their tax obligations are properly registered with local municipal offices and that they receive annual tax bills at their designated address or through their local representative.
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Are there any exemptions or reductions available, for example for primary residence or agricultural land?
Montenegro offers several property tax reductions, with the most significant benefits available for primary residence owners who are Montenegrin citizens.
Primary residence owners can receive up to 20% base reduction on their property tax, plus an additional 10% reduction for each household member (spouse, children) up to a maximum total reduction of 50%. A family of four could potentially cut their property tax in half.
Agricultural land used for active farming often qualifies for exemptions or significantly reduced rates, though this requires verification of actual agricultural use. State institutions, certain NGOs, and properties used for public purposes may also receive full exemptions.
Properties with cadastral values below €5,000 may be completely exempt from taxation in some municipalities, providing relief for very low-value rural properties. Senior citizens and disabled persons may qualify for additional municipal-specific reductions.
Foreign property owners generally cannot access primary residence reductions unless they establish legal residency in Montenegro and use the property as their main dwelling.
When exactly do property owners need to pay the yearly tax, is it once a year or in installments?
Property tax in Montenegro is paid in two equal installments with specific deadlines that property owners must meet each year.
Municipal authorities issue tax bills to all property owners by April 30th each year, providing detailed calculations and payment instructions. The first installment must be paid by June 30th, covering half of your annual tax obligation.
The second and final installment is due by October 31st of the same year. This two-payment system helps property owners manage their tax obligations and provides cash flow benefits compared to a single large annual payment.
Property owners can choose to pay the full annual amount with the first installment if they prefer, but the municipality will not require full payment until the October deadline for the second installment.
It's something we develop in our Montenegro property pack.
Are there penalties or late fees if the yearly tax is not paid on time?
Yes, Montenegro imposes statutory late fees and penalty interest on overdue property tax payments, with rates varying by municipality.
Missing the June 30th deadline for the first installment triggers immediate penalty interest charges on the overdue amount. The same applies to the October 31st deadline for the second installment, with penalties calculated from the due date until payment is received.
Penalty rates typically align with Montenegro's standard rates for outstanding tax debts, often ranging from 8% to 12% annually. These penalties compound over time, making prompt payment essential for property owners.
Properties with several years of unpaid taxes may face administrative action including potential liens or forced collection procedures. Municipal authorities can also initiate legal proceedings to recover substantial outstanding tax debts.
Property owners traveling abroad should arrange for local representatives or online payment systems to ensure timely tax payments and avoid accumulating penalties.
Can the yearly property tax be paid online, and what is the typical payment process in Montenegro?
Yes, Montenegro offers multiple convenient payment options including online systems, making property tax payment accessible for both local and foreign property owners.
Property owners can pay online through the eUprava government portal or municipal web services, which accept major credit cards and bank transfers. Many municipalities have developed their own online payment systems specifically for property taxes.
Traditional payment methods remain available at local banks, post offices, and municipal offices throughout Montenegro. Bank transfers from foreign accounts are also accepted, though owners should verify exchange rates and potential fees.
For foreign property owners, online payment represents the most convenient option, eliminating the need to visit Montenegro twice yearly just for tax payments. Payment confirmations are typically provided electronically and should be retained for record-keeping.
Property owners should ensure they have their property identification numbers and tax bill reference codes when making online payments to ensure proper credit to their accounts.
It's something we develop in our Montenegro property pack.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Montenegro property taxes are relatively affordable compared to many European countries, with most residential properties facing annual tax bills between 0.25% and 1% of assessed value.
Foreign investors pay the same rates as local citizens, and the two-installment payment system provides flexibility for managing tax obligations throughout the year.
Sources
- Immigrant Invest - Taxes in Montenegro
- Monte Global - New Taxes in Montenegro 2025
- Omnia Capital Group - Complete Cost of Buying Property Montenegro
- CEE Legal Matters - Real Estate Montenegro 2025
- Realting - Property Taxes in Montenegro
- Violet Investment - Real Estate Tax Montenegro 2025
- Monte Global - Property Tax in Montenegro
- Eurofast - Montenegro Tax Card 2025
- Montenegro Guides - Tax Guide
- PWC Tax Summaries - Montenegro Other Taxes