North Macedonia: tax obligations for freelancers
Published on 2019-11-18 by Marek Siarkiewicz.
Why Macedonia? Because the country made a lot of effort to become investor-friendly which resulted in obtaining a high, 10th rank in Doing business report in 2019.
A small country yet crowded with freelancers
North Macedonia, with a population of roughly 2,1 mln, is neither big nor a populous country. However, the indicator measuring the number of freelancers per 1000 citizens is the highest in the world. It equals 3,41 (data from |this site, access: December 2018). And we’re only talking about these remote employees who are registered on popular freelancing sites.
Individual with no registered business, working remotely
We consider a typical case of a regular individual who does not run their own business. He/she works for a local or foreign client and receives transfers to the account in the agreed amount. If a client is from abroad, it is on the freelancer to settle taxes and (often) social security contributions. It’s good to be aware of that to avoid getting into trouble with local fiscal authorities at the end of the year.
The discussed case also applies to people whose main occupation is a regular, full-time job. Side gigs are just a way to earn extra income.
Scope of work: we talk about typical remote work, such as programming, graphics, copy-writing, translations, online customer service etc.
Obligations and taxes when settling work in Macedonia
In this country, the climate is especially favorable for people engaged in freelancing. Let’s describe briefly the most important facts of this European tax heaven.
No need to register a business
Although it sounds natural and obvious, this isn’t a universal rule. In several countries (e.g. Spain, Bosnia) there’s an obligation to register a company when receiving remuneration from abroad. Not the case in North Macedonia.
All you need to pay is a 10% income tax.
A Macedonian tax resident is only obliged to pay a 10% tax on the income not exceeding 90 000 MDK per month (1500 EUR). This tax has recently become progressive and now (as of 2019) the outstanding sum is burdened with an 18% rate. However, the Macedonian legislator won’t let us get bored - they decided to go back to the previous system of a flat, 10% rate. The new-old bill enacts from January 2020.
This is merely the beginning of tax pros in the Macedonian law.
Are you interested in more information?
Do you want to read about retirement contributions and VAT registration requirement?
Download a full report about taxes for freelancers in North Macedonia.
Are you encouraged to hire a Macedonian freelancer?
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