0% Profit Tax for Businesses with Annual Turnover up to 14 Million Lek

The Albanian government has approved amendments to the Income Tax Law aimed at supporting small businesses. Under the new provisions, companies with an annual turnover of up to 14 million lek (approximately €133,000) will benefit from a 0% profit tax starting from 1 January 2021.

Until now, businesses with an annual turnover between 0 and 5 million lek were exempt from profit tax, while companies with revenues between 5 and 14 million lek were subject to a simplified profit tax of 5%. With the new amendments, the exemption has been extended to all businesses with an annual turnover of up to 14 million lek.

The main amendments to the law are as follows:

Article 2

Paragraph 1 of Article 28, “Tax Rate”, has been amended as follows:

1. The profit tax rate shall be:

• 0% for taxpayers with an annual income of up to 14,000,000 lek;
• 15% for taxpayers with an annual income exceeding 14,000,000 lek.

Article 3

This law shall enter into force 15 days after its publication in the Official Gazette, and its provisions shall apply with effect from 1 January 2021.