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Doing business in North Macedonia

How quickly can I set up a business?

1-2 days

What is the minimum investment needed?

No minimum (but the capital should be paid-in within 12 months after the establishment of the Company).

How can I raise finance?

Internal and external sources for funding a business are available:

  Internal sources such as investment by the owner of the company, proceeds from retained earnings, sale of assets, cash flow from operating activities, etc.

 External sources such as loans from banks, loans by third persons, leasing, factoring, etc.

What are the legal requirements for setting up my business?

In accordance with the Trade Company Law, both Macedonian and foreign individuals or companies can establish the following types of business entities:

General Partnership this is an association of two or more legal entities or individuals who are personally and jointly liable without limit to the creditors. This liability includes their entire property.

Limited Partnership this is a partnership of two or more entities or individuals in which at least one of the partners will be jointly liable without limit and with his entire property for the obligations of the company (“general partner”) and at least one partner (“limited partner”) who is liable for the obligations of the company up to its recorded contribution in the company.

Limited Liability Company (DOO or DOOEL) this is a company in which the shareholders participate with one share each (basic contribution) in the company’s pre-determined basic capital.

The basic contribution may differ in value, but the contribution cannot be in the form of labour or services. A minimum of 1 and a maximum of 50 shareholders can establish a limited liability company

Joint-Stock Company (AD) this is a company that has, by its Charter, a defined capital (basic capital) divided into equal parts (shares). Shareholders participate with one or more shares and their liabilities are secured with the entire capital of the company. A joint-stock company may be founded by one or more legal entities or individuals.

Limited Partnership by Shares this is a company in which one or more general partners are liable jointly without limit for the company’s obligations. Limited partners have the status of stockholders and are not liable for the obligations of the company.

Sole Proprietors individuals that conduct business operations are required to register as sole proprietors. The individual is fully and unlimitedly liable with all his assets to the creditors.

Branch offices – A foreign company may generally conduct business activities in North Macedonia by establishing a branch office. A foreign company can establish a branch office in Macedonia if it is registered in the Trade Register of its domicile country.

Representative offices – A foreign company that is permitted to carry out commercial activities in its jurisdiction may establish a representative office in North Macedonia. A representative office of a foreign company is not a legal entity. It is only permitted to undertake activities of re-search or information-gathering nature and may not undertake commercial activities.

All types of legal forms are required to be registered in the Trade Register.

What structure should I consider?

The structure that is most recommended in North Macedonia for establishing a new business is the limited liability company (DOO or DOOEL).

A limited liability company is a company that means that the owner/ owners of the capital take a less financial risk by limiting themselves to the amount of the paid-in capital of the company.

The legally required minimum amount of the paid-in capital is 5,000 EUR in MKD counter value.

The owner/owners of the Company can take the most important decisions regarding the activity of the company but also may appoint themselves as a manager of the company.

What advice can you give me in regards to payroll and taxation requirements?

Employment Related Costs and Taxes

Social security costs – Employers are generally required to make the following social security contributions from the salary of employees (subject to minimum thresholds and salary ceilings):

Health insurance – 7.5%

Employment injuries and occupational diseases – 0.5%

Pensions and disability insurance – 18.8%

Unemployment – 1.2%

The current minimum net salary in North Macedonia equals MKD 18,000 (293 EUR), while the minimum gross salary equals MKD 26,422 (430 EUR).

As of January 2021, the average net salary was MKD 29,980 (487 EUR), while the average gross salary was MKD 44,762 (728 EUR).

Corporate Income Tax (CIT)

Resident legal entities are generally subject to tax on their profit arising from the activities performed on the territory of Macedonia and from incomes generated abroad. A legal entity is considered resident in North Macedonia if it is established in North Macedonia or if it has a head office on the territory of North Macedonia.

Non-residents are taxed only on the profit they generate from business activity on the territory of North Macedonia.

The standard corporate income tax rate is 10%.

A simplified tax regime is available to resident small and micro legal entities if:

  • The entity carries out economic activities, excluding banking, financial activities, insurance activities, games of chance, or entertainment games, and
  • The entity’s total annual revenue exceeds MKD 3 mil but does not exceed MKD 6 mil.

Under the simplified regime, qualifying taxpayers are subject to tax at the rate of 1% of total annual revenue. Qualifying resident small and micro legal entities whose total annual revenue does not exceed MKD 3 mil are not subject to CIT.

Dividend income received by a resident entity from another resident entity is deducted from the receiving entity’s tax base if such income was taxed in the hands of the paying company.

Unutilized losses can generally be carried forward for up to three years (restrictions may apply in cases where the status of the taxpayer changes, such as by merger, acquisition, separation, or transformation of ownership). There are no provisions for the carryback of losses.

The tax period is the calendar year.

Tax returns are generally due for filing by no later than the end of February of the following year, or by 15 March if filed electronically. Large and medium-sized entities are required to file their tax returns electronically.

Taxpayers are generally required to make monthly advance payments of corporate income tax payable within 15 days following the end of each calendar month. Any remaining corporate income tax due is payable no later than 30 days after the deadline for filing the tax return. If the advance payments exceed the eventual tax liability, the taxpayer may reclaim a refund of the excess. Alternatively, any excess tax paid can be carried forward as an advance payment for the next tax period. Taxpayers under the simplified tax regime are required to pay tax in one installment no later than 30 days after the deadline for filing the tax return.

Value Added Tax (VAT)

 The following sales are subject to VAT:

  • Sales of goods and services for compensation in the country within the business activities of the taxpayer.
  • Import of goods.

The standard VAT rate is 18%. A reduced rate of 5% rate applies to certain supplies, including products for human consumption, certain books and magazines, fertilizers, pharmaceuticals, medical equipment, aids for the disabled, baby products, and accommodation services. As of January 1, 2021, a new rate of 10% was implemented for food delivery services and on-site beverage and catering services, excluding alcoholic beverages, and for the supply and import of electricity for households.

The VAT registration threshold is generally annual turnover exceeding or expected to exceed MKD 2 mil.

Companies can apply for voluntary VAT registration if compulsory registration does not apply.

Is there anything else that I should know?

Annual financial statements

According to the Trade Company Law, the entities are obliged to prepare annual financial statements at the end of each calendar year. A large and medium-sized

entities as well as, financial institutions, legal entities that are listed on the Macedonian Stock Exchange, and entities whose financial statements are subject to consolidation, have an obligation to prepare the annual financial statements in accordance with International Financial Reporting Standards as published in Official Gazette. All other entities have an obligation to prepare the annual financial statements in accordance with

International Financial Reporting Standards for SMEs.


The following entities are required to have their financial statements audited by a certified auditor:

  • Large and medium-sized limited liability companies and joint-stock companies, and
  • Companies whose shares are listed on the Macedonian stock exchange.

Consolidated annual accounts and consolidated financial statements must also be audited by a certified


Technological and Industrial Development Zones (TIDZ)

Investors in technology and industrial zones can benefit from CIT, PIT for employees, VAT and other incentives under the agreement with the Technological Industrial Development Zones.

The establishment, development and monitoring of the zones is carried out by the Directorate for  Technological Industrial Development Zones.

There are currently fifteen operational TIDZs in North

Macedonia – three in Skopje, one in Tetovo, Stip, Struga, Prilep, Kichevo, Rankovce, Vinica, Berovo, Delcevo, Radovis, Strumica and Gevgelija respectively.

The tax exemptions and incentives available in the TIDZ include:

  1. i) Corporate income tax and personal income tax exemption for a period of up to ten years:
  2. ii) Personal income tax exemption for a period up to ten years in respect of the salaries paid to employees

in a TIDZ,

iii) VAT exemption on the sales of goods

and services within the TIDZ and on the imported goods into the TIDZ,

  1. iv) Customs duty exemptions (excluding alcohol, alcoholic beverages, tobacco, and tobacco


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