The Company Act in Montenegro regulates the forms of organizations pursuing economic activities and their registration procedure. Foreign investors and local businessmen alike can set up sole traders in Montenegro, following the provisions of this law.
Our experts in company registration in Montenegro can give you all the details regarding the process of setting up a sole trader.
If a sole trader is your choice of business, our company formation agents can provide you with a description of the main steps to take to open this type of company in Montenegro. These include the following:
Quick Facts | |
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Applicable law | The sole trader can be set up following the Company Act. |
Special requirements related to the name (YES/NO) | Yes, the sole trader operates under his/her own name. |
Legal personality (YES/NO) | No, the sole proprietorship in Montenegro does not have a distinct legal personality. |
Activities permitted | A sole proprietor can complete any activity as long as it can be undertaken by a single person. |
Registration availability for foreigners (YES/NO) | Yes, this business form can also be employed by foreigners. |
Special requirements for foreign citizens (if any) | Yes, the foreign citizen must first obtain a Montenegrin residence permit. |
Authorization requirements (if any) | Depending on the profession of the sole trader (dentists and accountants must be certified by the appropriate bodies). |
Local address required (YES/NO) | Yes |
Authority to be registered with | Companies Register |
Tax registration required (YES/NO) | Yes, the sole trader must obtain a tax identification code. |
VAT registration requirement (YES/NO) | No, VAT registration is not required unless he/she registers EUR 30,000 revenue |
Social insurance registration requirement (YES/NO) | Yes, the sole trader must pay his/her own social insurance premiums. |
Taxation of sole traders in Montenegro | The sole trader is subject to the personal income tax. |
Personal income tax rate | 0% to 12.5% depending on the income bracket |
Support in setting up a sole trader in Montenegro (YES/NO) | Yes, we offer support to Montenegrin and foreign citizens intrested in this business form. |
Legal personality (YES/NO) | No, the sole trader is a non-corporate business form. |
Minimum share capital required (YES/NO) | No. |
Liability of the owner | Unlimited. |
Local bank account required (YES/NO) | Yes, a Montenegrin bank account is required for a sole proprietorship. |
Registration time frame (approx.) | Approx. one week. |
Registration steps | – payment of the registration fee, – notarization of the identification papers, – bank account opening, – Companies House registration, – tax registration. |
Registration documents | – owner’s personal identification papers, – a standard application form, – valid residence permit for foreign citizens, – registration fee payment receipt. |
Business seal requirement (YES/NO) | Yes, a sole trader must obtain a seal. |
Work permit requirement (YES/NO) | Yes, the work permit can be obtained alongside the residence visa. |
Municipality registration requirement (YES/NO) | Yes, the sole trader must register with the municipality in the city he/she will undertake the activities. |
Possibility to register a sole trader remotely for foreigners (YES/NO) | Yes, through a power of attorney. |
Simplest type of company to incorporate | The sole trader. |
Possibility to use a virtual office as a legal seat (YES/NO) | Yes. |
Annual accounting requirements | The sole trader must file annual income tax returns. |
Advantages of the sole trader | – easy to set up, – simple tax requirements, – the owner is entitled to all the profits. |
Do not hesitate to get in touch with our representatives in company formation in Montenegro if you need professional assistance in setting up a sole trader. Besides this, if you are planning to buy a shelf company, you can get assistance from our agents. They can offer you appropriate shelf companies as per your plans.
All business registration processes in Montenegro are handled by the Central Register of the Commercial Court (CRPS). The following list of documents is required for the registration of a sole proprietorship in Montenegro:
Our company registration advisors in Montenegro can assist with the incorporation of a sole trader with the Companies Registrar.
The single proprietorship is also known as a one-person company. This kind of business is managed and operated by a single person. The trader bears full responsibility for any business earnings and losses stemming from their operations. In Montenegro, a sole proprietorship is not a recognized legal organization.
The sole proprietorship can be established in Montenegro by anyone who is at least 18 years old. For foreigners, the age restriction is the same. Foreigners who wish to establish a sole proprietorship business in Montenegro have to create a bank account and obtain a residency permit.
It is necessary for foreigners to create a bank account prior to registering as a sole owner. Our company formation agents in Montenegro can offer support in the opening of the account.
In Montenegro, there may be variations in the duration required to register a sole proprietorship. The average timeframe to obtain a registration certificate is 4 to 5 days. There is no minimum share capital needed, and the owner is free to invest as much or as little as he considers appropriate in the company. Filing the necessary paperwork to the Trade Register and registering for taxes in Montenegro are the prerequisites for anyone wishing to become a registered sole proprietor.
Feel free to address our specialists about any questions if you want to open a company in Montenegro.
A sole owner must be an adult with the capacity to contract. A license from the relevant authorities may be required in specific circumstances for launching the business. For instance, the local government expects anyone wishing to open a pharmacy to obtain a license. You should register as a sole trader in Montenegro because you can get the following benefits by doing so:
If you need to learn more about the benefits of setting up a sole trader in Montenegro, you can get help from our agents. Our company incorporation consultants can offer you comprehensive guidance.
Here is our infographic on this type of business form:
Furthermore, you can also get help from our agents if you want to open a branch office in this country.
A sole proprietorship has fewer risks than other business structures with numerous shareholders and stricter legal requirements because it is solely owned by one person.
The advantages of registering as a self-employed person in Montenegro are as follows:
In Montenegro, there is no share capital needed to open a sole trader. Depending on the type of business activity you plan to conduct after establishing a sole trader you must apply for a business license. The simplest business structure under which one can run a firm is the sole trader. It merely designates a person who is the company’s owner and liable for all of its debts. Particularly small-scale dealers, craftsmen, cab drivers, etc. adopt this manner of conducting business because of the initially cheaper expenses and administrative needs.
Although it is the simplest business form to incorporate, still it is important to get help from specialists. Especially when you are a foreigner and do not know the regulations of the country, you can get in touch with our agents. They can help you apply for the relevant work permit. Because if you regulate any activity without a permit from the relevant authorities, you may face legal complications. So, you are advised to get help from company formation specialists. Furthermore, if you are seeking incorporation assistance to open a D.O.O. in Montenegro, the services of our agents are at your disposal.
The commercial legislation specifies six types of companies that an entrepreneur can open in Montenegro. The sole trader is the smallest and simplest form a business can take in Montenegro. It does not require a minimum capital to be set up and the trader is liable for all debts incurred to the full extent of his/her assets. If a sole trader in Montenegro does business in the name of another person, then his/her name must be registered following the provisions of the specific rules and regulations. A sole trader in Montenegro can change the name of the business but is obliged to inform the Central Registry about the change within 30 days from the moment when the change occurred.
Any individual interested in activating as a sole trader in this country must follow the standard company registration procedure in Montenegro, by submitting a registration statement according to the provisions of the commercial laws of the country. A registration certificate is provided to the sole trader upon registration. Please note that this registration certificate does not represent a business permit or a license for conducting commercial activity. Our Montenegro company formation agents can tell you more about the legal aspects of establishing a sole trader.
In Montenegro, sole traders are private individuals who engage in market activity to make a profit. The Company Act in Montenegro governs these legal entities in this country. The following data regarding the taxation of sole proprietors in Montenegro are provided by our agents. You can also ask any further questions from our agents regarding sole trader’s taxation.
The taxation of sole proprietors in Montenegro is governed by the personal income tax law. This law sets the personal income tax rate at 9% of the tax base. All natural individuals who get income from various sources, including self-employment, are subject to this income tax. The same statute mandates some of the following tax breaks for Montenegrin sole proprietors. For the taxpayer who invested in fixed assets for his or her firm, the computed tax is reduced to 50% of the investments that were made. More information on this subject is available from our Montenegrin company formation specialists. Some fixed assets are not regarded as fixed, except for those listed in the first depreciation category and passenger vehicles, with some exceptions; Our company incorporation office in Montenegro may assist business owners who want to establish a sole proprietorship in this state; A taxpayer must increase the tax base for the value of the used tax relief for the asset sale or divestiture year. This is possible if they sell or divest the aforementioned fixed assets before the three-year window following the year in which the tax relief was used expires.
Here is our video on this subject:
According to the European Commission, Montenegro’s economy:
If you need more information in this regard, you can contact our agents. Besides information, they can also practically assist you in company incorporation. Furthermore, if you need expert help with online incorporation, you can consult our specialists.