Albania · Tax regime
Zero-Rate Regime for Self-Employed and Small Business Income (Law nr. 29/2023 as partially annulled)
Law nr. 29/2023 took effect on 1 January 2024. It set rates of 15%/23% for self-employed people and free professions, while pushing back the same obligation for other small businesses to 2029. On 27 June 2024, the Constitutional Court unanimously annulled Article 69 of Law 29/2023 and Article 4 of VKM 753/2023, finding they breached legal certainty, legitimate expectations, clarity of the norm and proportionality. Freelancers went back to 0% up to ALL 14m until 31 December 2029, and roughly ALL 501m in prepaid instalments was refunded to about 6,450 taxpayers. This was a targeted judicial annulment of the discriminatory element. It was not a postponement, and it was not a full reversal.
A 0% rate on roughly EUR 135k of business income, protected by a constitutional court rather than by administrative grace, is the most defensible low-tax position in the Balkans. The judgment's reasoning, built on legal certainty and legitimate expectations, makes an arbitrary reversal harder here than in most of the region. But it carries a hard expiry date that most marketing leaves out.
Qualifying routes
0% on taxable profit up to ALL 14m, roughly EUR 135k, until 31 December 2029. Above that threshold, the rate is 23%.
You may elect an automatic-expense-deduction regime.
The facts
- Total landed cost
- This covers registration and accounting only, roughly EUR 1,000–3,000 a year.
- Route type
- Tax regime, not a visa
- Timeline
- 1–2 months (You register with the National Business Centre.)
- Physical presence
- Spend 183 days here and you become a tax resident, which brings worldwide taxation. The regime itself does not impose a presence test.
- Family
- This is an individual regime, not a family status
- Permanent residency
- Not applicable. This is a tax status, not a residency pathway.
- Citizenship
- Not applicable
- Language test
- None
- Dual citizenship
- Permitted
- Requirements
- Register as self-employed or as a small business with the National Business Centre.Keep taxable profit under ALL 14m to hold the 0% rate.To avoid reclassification, serve only non-resident clients and keep no permanent establishment in Albania.File annually.
- THE 2029 CLIFF IS REAL. The 0% rate is a dated concession, not a structural feature. Any plan whose economics depend on it needs to model 23% starting 1 January 2030, when everyone converges.
- THE 80/90% RECLASSIFICATION RULE. Self-employment income is recharacterised as employment income (13%/23%) where 80% or more comes from one client, or 90% or more from fewer than three. The way out is a carve-out for those serving exclusively non-resident persons or entities with no Albanian permanent establishment. It has to be maintained rigorously, with no Albanian-source or PE-tainted revenue at all. This carve-out is the single most important provision for a foreign remote-earning client.
- ALBANIA'S CFC RULES BITE AT 30% PASSIVE INCOME. That is unusually aggressive for a jurisdiction marketed as light-touch. Resident individuals are taxed at 15% on passive income from a controlled non-resident company where passive income is 30% or more of the CFC's profit. Albania is not a passive-holding-friendly residence, whatever the 0% headline suggests.
- The former 0% low-income band on employment income was removed from 1 January 2025. Employment income is now taxed at 13% from the first lek.
- Albania participates in CRS. There is no opacity here to complement the low rate.