Montenegro: Tax Treatment of E-Commerce


The online sales market or e-commerce in the region is growing rapidly. Every day, more and more legal entities recognize the need to place or just present their products on the Internet market. There are numerous advantages of internet sales , and one of the biggest – it brings customers the speed and availability of various types of products, while sellers have benefits in reduced business costs. Given that online commerce is increasingly represented in total trade, this area needs to be further regulated, especially from the tax point of view. 

Law on Prevention of Illegal Business prescribes that it is prohibited to perform activities without prior registration or without the approval prescribed by law, i.e., contrary to the conditions under which that approval was given. Also, according to the Law on Prevention of Illegal Business, a legal entity and entrepreneurs are obliged to conduct their business through bank accounts, which must be previously registered with the Tax Administration.

After registration in the Central register of business entities, companies are obliged to perform a general tax registration,  registration of the activity (business facility, toll collection device, etc.) To confirm that they perform in accordance with the business code, with the regional body of the Tax Administration.

The legal entity is obliged to keep business books, compile, and submit financial statements compliant with accounting regulations and submit an annual corporate income tax return form and pay the final obligation on corporate income tax. As an entrepreneur, one has the obligation to keep business books, compile and submit financial statements in accordance with accounting regulations and submit an annual personal income tax return form to the tax authority by the end of April the year following the reporting year and settle the final obligations. 

 Also, the taxpayer is obliged to issue an invoice or other document that serves as an invoice for the turnover of products or services. The invoice is issued in two copies, of which the original is kept by the buyer, and a copy is kept by the supplier of the product or service. 

A taxpayer who conducts retail trade using means of distance communication (Internet) has the obligation to: 

  • Harmonize the business with special legislation that regulates this form of retail trade (registration of activities – internet trade, reporting activities to the market inspection, reporting data to the Tax Administration via the form JPR – activity, facility, address, register of cash registers, etc.);
  • Keep records of turnover of products that are collected in cash through the tax cash register, regardless of the method of payment (cash, check, card, bank transfer payment), when the products are sold to a natural person (retail);
  • When making a bank transfer payment, the taxpayer may issue an invoice in addition to the fiscal invoice, provided that  the number of the fiscal invoice, the name of the retail facility  and  recorded turnover from  fiscal invoice provide  all necessary data for correct and timely calculation and payment of VAT in its bookkeeping, i.e., keep records on turnover of products and services and to provide data on that turnover that enable control of calculation and payment of VAT – data on received invoices, data on issued invoices, and monthly VAT returns, inventory lists, reports on realized cash turnover.

For additional information, please contact Mr. Fahrudin Sutkovic,  Accounting Manager in Montenegro at

Eurofast is a regional business advisory organisation employing local advisors in over 23 cities in South East Europe & the Middle East (SEEME). The Organisation is uniquely positioned as one stop shop for investors and companies looking for professional services inTax & Transfer Pricing–Payroll & Employment–Accounting & Audit–Advisory & Corporate.
Fahrudin Sutkovic
Accounting Manager
Eurofast Podgorica