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COVID 19 – New deadlines and relieves for income tax declarations

COVID 19 – New deadlines and relieves for income tax

On 23 April 2020 the Albanian Government approved some changes to the existing Law No.8438 on “Income Tax” amending some important deadlines related to the corporate income tax (CIT) advance payments of 2020 and annual personal income tax declaration. In addition, some changes were approved to the Law No.9632 dated 30.10.2006 on “Local Taxes” including reliefs to taxpayers registered for the small tax and certain investments.

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2020 CIT advance payments

The CIT taxpayers having an annual turnover which exceeds ALL 14 million will not be obliged to make any CIT advance payments for period April – December 2020. However, the payment of the CIT installments for the abovementioned period will be postponed to the next year and will be due during the period April - September 2021.

This relief will not be applied for CIT registered taxpayers operating in the sectors of banking, telecommunication, trade of pharmaceuticals, groceries/vegetables, tourism, inward processing regime and call center activities.

Based on a prior amendment made to the Income Tax Law, the CIT taxpayers having an annual turnover of less than ALL 14 million were obliged to settle the CIT advances of 2020 within September and December 2020. According to the new amendment, this category of CIT taxpayers will pay no CIT advance payments related to the financial year 2020.

2020 advance payments of simplified income tax on small business

Taxpayers registered in the category of small business will not be obliged to pay the advances of simplified tax for small business for the financial year 2020. In an earlier change of the Law on Local Taxes, the installments for local tax of small businesses were due by 20 October 2020 and 20 December 2020.

Infrastructure Tax exemption

Investments subject to reconstruction programs approved in accordance with the law on management of consequences of natural disasters will be treated as exempt from payment of the tax on infrastructure.

Annual Personal Income Tax Return of Individuals

The personal income tax declaration of the year ended 2019 will be postponed to 31 July 2020. In addition, the payment of the personal income tax obligations for individuals related to the 2019 personal income tax return will be deferred up to 31 July 2020.

Entry into force

The changes in the Law No.8438 dated 28.12.1998 on “Income Tax” and those of the Law No.9632 dated 30.10.2006 on “Local Taxes”, as amended, are published in the Official Gazette no. 73 dated 24 April 2020.

© 2020 KPMG Albania Shpk, an Albanian limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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