Albania Corporate Tax Guide: CIT 15%, Micro 0%, Small 5% 2026

Albania's Corporate Income Tax (CIT) regime features a standard rate of 15%, one of the lowest in Europe. Micro-enterprises with annual turnover below ALL 5 million pay 0%. Small businesses with turnover between ALL 5 million and ALL 14 million pay 5%. Reduced rates and incentives are available for IT, innovation, and strategic sectors. Here is how Albanian corporate tax works in 2026.

Corporate Income Tax in Albania is governed by Law No. 8438 on Income Tax and administered by Drejtoria e Përgjithshme e Tatimeve (DPT). The standard CIT rate of 15% applies to all legal entities. Albania offers one of the most competitive corporate tax regimes in Southeast Europe, significantly lower than Greece (22%), Italy (24%), and Germany (~30%). The tax year is the calendar year. Companies must file annual CIT returns by March 31 of the following year. Filing and compliance guide →

Real-world example: A Tirana-based consulting company with annual turnover of ALL 30 million and taxable profit of ALL 8 million pays CIT at 15% = ALL 1,200,000. A micro-enterprise with ALL 4 million turnover and ALL 1 million profit pays 0% CIT. A small business with ALL 10 million turnover pays 5% on taxable profit. Compare this to Greece where the same profits would incur 22% CIT, or Italy at 24% plus regional taxes. IT sector incentives →

Corporate Tax Rate Structure

0% (micro-enterprises): Annual turnover below ALL 5 million — full CIT exemption
5% (small businesses): Annual turnover between ALL 5 million and ALL 14 million
15% (standard): All other companies with turnover above ALL 14 million
Reduced rates: IT, innovation, and strategic investment sectors may qualify for reduced rates or tax holidays

Micro and small business rates apply to companies meeting specific criteria including turnover thresholds and number of employees. Companies may lose eligibility if they exceed thresholds or fail to meet conditions. The 0% and 5% rates are designed to support small business development and formalize the economy.

Taxable Income and Deductions

Corporate taxable income is calculated as accounting profit adjusted for tax purposes. Key rules include:

Depreciation: Standard rates apply — buildings 5%, machinery 20%, vehicles 20%, computers 25%
Interest deductibility: Thin capitalization rules limit interest deductions (debt-to-equity ratio 4:1)
Loss carryforward: Tax losses can be carried forward for 3 years (with limitations)
Dividend deduction: Dividends received from Albanian resident companies are generally exempt from CIT
Capital gains: Treated as ordinary income and taxed at standard CIT rate

Transfer pricing rules apply for transactions with related parties. Documentation requirements follow OECD guidelines. Albania has a formal tax ruling system for advance pricing agreements. Cross-border taxation →

Withholding Taxes on Outbound Payments

Albania imposes withholding tax on certain payments to non-residents:

Dividends: 8% WHT (0% for residents, 8% for non-residents)
Interest: 15% WHT (0% for residents)
Royalties: 15% WHT (15% for both residents and non-residents)

WHT rates may be reduced under Albania's Double Taxation Treaties (over 35 treaties). Investment income guide →

Tax Incentives and Exemptions

Albania offers various incentives to attract investment:

IT sector: Reduced CIT rates for software development, IT services, and innovation
Strategic investments: Tax holidays and customs duty exemptions for qualifying large investments
Economic zones: Incentives for companies operating in designated industrial and economic zones
Employment incentives: CIT reductions for hiring certain categories of workers

Incentives typically require prior approval, minimum investment thresholds, and job creation commitments. IT sector-specific incentives →

Who needs to register for CIT in Albania?

All legal entities (companies, partnerships, branches of foreign entities) must register for CIT with the DPT. Registration is required before starting business operations. Non-resident companies with a permanent establishment in Albania are also subject to CIT on Albanian-source income.

What is the filing deadline for corporate tax?

Annual CIT returns must be filed by March 31 of the following year. Tax is paid in quarterly installments during the year based on the previous year's liability, with a final settlement upon filing. Late filing penalties apply.

Are there any regional taxes in Albania?

No. Albania has a unitary tax system with no regional or municipal corporate taxes. The 15% CIT is the only corporate-level tax. There is no trade tax, business tax, or local surcharge on corporate profits.