Montenegro: Arm’s length interest rate for 2023
Interest rate for financial instruments between related parties for the year 2023
Interest rate for financial instruments between related parties for the year 2023
The Ministry of Finance adopted the rulebook on the interest rate for financial instruments between related parties for the year 2023, which was published in the official gazette No.142 dated 21 December 2022 and is effective 1 January 2023.
Under the new transfer pricing rules, taxpayers may apply either the arm’s length interest rates prescribed by the Ministry of Finance (which for 2023 is 3.98%) or the OECD’s general rules on determining the price of a transaction based on the arm's length principle.
KPMG observation
Taxpayers with significant or long-term related party financing may want to consider applying the OECD’s general methods for assessment of arm’s length interest as such approach may be more beneficial and provide increased level of certainty in relation to future tax treatment.
Read a December 2022 report [PDF 618 KB] prepared by the KPMG member firm in Montenegro
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