Corporate Income Tax: Rates, Deadlines and Calculation

Rate and tax base

The corporate income tax rate in Macedonia is a flat 10% on the tax base. The tax base is calculated as the difference between total revenues and total recognized expenses of the company during the fiscal year (January 1 to December 31). It is important to note that not all expenses are tax-deductible — certain items must be added back to profit when calculating the tax base. For small companies with annual revenue up to 6,000,000 MKD, there is a simplified tax procedure — they can pay 1% of total revenue instead of the standard corporate income tax, which significantly simplifies administration.

Deductible and non-deductible expenses

Proper classification of expenses is crucial for accurately calculating the tax base.

• Deductible — Salaries and contributions for employees, including bonuses and allowances.
• Deductible — Procurement of raw materials directly related to production.
• Deductible — Rent for business premises, office supplies, and utility costs.
• Deductible — Depreciation of fixed assets at prescribed rates.
• Non-deductible — Fines and penalties imposed by government authorities.
• Non-deductible — Representation costs exceeding 1% of total revenue.
• Non-deductible — Donations above the legally permitted limit (5% of revenue).
• Non-deductible — Expenses not documented with a valid invoice.

Advance payments

Companies in Macedonia pay monthly advance payments on corporate income tax. The advance payment is calculated based on the previous year's profit divided by 12 months. The monthly advance is due by the 15th of the current month for the previous month. If the company expects significantly lower profit in the current year, it can submit a request to UJP to reduce the advance payment amount. After submitting the annual tax return, a final calculation is made — if total advance payments exceed the actual tax, the difference is refunded or carried forward.

Annual DB-VP return: Step by step

1. 1

   Prepare financial statements

   Complete the annual balance sheet and income statement. All revenues and expenses must be accurately recorded and documented with invoices.

2. 2

   Calculate the tax base

   Start from accounting profit, add back non-deductible expenses, and subtract tax reliefs to arrive at the final tax base.

3. 3

   Fill out the DB-VP form

   Enter the data into the DB-VP form through UJP's e-Tax system. The form includes all items for tax calculation.

4. 4

   Submit by March 15

   The annual tax return must be submitted electronically to UJP no later than March 15 of the current year for the previous fiscal year.

5. 5

   Pay any remaining difference

   If the calculated tax exceeds total advance payments, the difference must be paid by April 30.

Penalties and consequences

Failure to comply with corporate income tax deadlines and rules carries serious consequences.

• Late filing — Fine of EUR 500 to EUR 5,000 for the legal entity and EUR 250 to EUR 1,000 for the responsible person.
• Non-payment of advances — Interest of 0.03% per day on the unpaid amount, plus potential additional fines.
• Inaccurate data — If UJP determines intentional reduction of the tax base, the fine can reach up to 100% of the concealed tax.
• Lack of documentation — Non-recognition of expenses without a valid invoice or contract.
• Facturino helps — Automatic profit and loss reports, tracking of deductible expenses, and generation of data ready for the DB-VP return.