When a client who wants to set up a company in Montenegro sits down across from me, I walk them through three things in order: first the total cost, then the sequence the file will move through, and finally the taxes the company will run into. With a d.o.o. (društvo sa ograničenom odgovornošću, a limited liability company) formation, that is really the whole story. The phrase "a company for 1 euro" is technically true but incomplete, because 1 euro describes only the minimum capital; the real picture emerges once you add the notary, CRPS (the Central Register of Business Entities), the address, the bank, accounting and, where needed, VAT registration. I won't repeat the "why" section from the main Montenegro company formation guide here; this article goes straight to the doing.
The Bare Truth I Put on the Table First
For a d.o.o., the minimum capital under the new Companies Act (Zakon o privrednim društvima) is still 1 euro. But the same Act says two very important things as well: the company acquires legal personality on the day of CRPS registration, and a company seal (pečat) is no longer mandatory — although for electronically processed matters an electronic seal (elektronski pečat) may be required. There is one more point: as of 2026 you are already forming your new d.o.o. under the new statutory regime, so the "usklađivanje" (harmonization) obligation is essentially a matter of bringing the organization of existing companies into line with the new system. It does not create a second compliance file for a brand-new incorporation.
What surprises my clients most is this: the official CRPS/publication fee for incorporation is small, but the address, the notary, translation, and the monthly accounting that follows are what actually determine the budget. That is why I separate "cost of incorporation" from "cost of owning a company" right at the start. I won't go into the detail of the ongoing accounting and filing side here; it belongs more properly under the heading of Montenegro tax and accounting.
How I Run a d.o.o. Incorporation on the Ground
I usually start the file with the name. The company name must be chosen so that it is distinctive in the CRPS and does not clash with another existing business; if you wish, it is possible to reserve the name separately, and the reservation is held for 90 days. In practice, if I'm chasing a name with high brand value I reserve it; for an ordinary d.o.o. file I most often go straight into the incorporation application.
The second step is the document set. For a single-member structure I prepare a founder's resolution; for a multi-member structure, the founding act (osnivački akt, the constitutive deed); to this are added the articles of association (statut), the appointments to the management body, the acceptance statements, and the email and postal address details. Under the 2025 procedural rule, registering a d.o.o. with the CRPS requires at least the osnivački akt, the statut, the management-body details and appointment decisions, the acceptance-of-office statements and the other necessary annexes; the documents must be originals or certified copies. Where there is a foreign member, a foreign legal entity, or a power of attorney, that is precisely why I add translation and, where needed, an apostille line item to the budget.
The notary stage is the critical break point of the file. The rule text specifically requires that, for a d.o.o., the osnivački akt be certified in accordance with the law; where the file involves a power of attorney, a foreign document, or signature circulars, the notary work naturally grows. It would not be honest of me to quote a single fixed tariff here; in the field I see a lower line item on a simple file and a higher one on a document-heavy, foreign-founder file. I write this up for the client as a heading of roughly €50–200+ on most files, going higher still on files heavy with foreign paperwork.
The CRPS application now moves within a clearer framework. According to the one-stop-shop (PSC) information, the incorporation application shows a €5 payment to the Tax Administration (Poreska uprava) and a €3 payment to the Official Gazette (Službeni list). The 2026 official statement explains the decision time as at most 5 business days where the founders are natural persons, and at most 10 business days for other files; the same statement says that in practice a large number of applications are completed in 1–2 days. Even so, I tell the client: "Base your plan on the statutory deadline, and count it as a bonus if it comes faster."
I also track the PIB (the tax identification number) at this stage. The current registration form already includes fields for the taxpayer register and the VAT-payer register; in other words, the tax side is not detached from the CRPS file. The company acquires legal personality on the day it is registered; the tax identity and the subsequent bank/VAT step sit on top of that registration. If residence through the company is being planned, I don't open that up here; I leave it to the Montenegro residence permit through a company page.
I handle opening the bank account right after the CRPS decision. The most variable step of the file is usually the bank's KYC part. Even though the law allows 1 euro of capital, I always tell the client this: in the eyes of the bank and of counterparties, a "company with 1 euro of capital" and a "company funded with reasonable working capital" do not create the same psychological effect. Moreover, the current rule states explicitly that where cash capital above the minimum is contributed, proof that it has been paid in must be added to the file.
VAT registration, on the other hand, is not an automatic "condition of incorporation." If turnover is below the threshold, the company can start as a small taxpayer; once the threshold is exceeded, registration becomes mandatory. Even so, for certain B2B work, or in a structure that wants to deduct input VAT from the outset, voluntary registration may make more sense. A physical seal is not mandatory today; if you will be working with an electronic workflow, the elektronski pečat comes into play.
How I Draw Up the Real Cost Breakdown
The table below is the summary budget I show, item by item, when I open a file — the official and the market line items. The official-fee part is narrow, the market part is wide, because notary, address, advisory and accounting are not fixed official fees: they vary with the structure of the file. The basic registration/publication payment published by the one-stop-shop (PSC) is €8; the address and accounting, on the other hand, run across a wide band on the market.
| Line item | The practical band I explain to the client |
|---|---|
| Minimum capital | €1 minimum; for commercial credibility I plan for higher on most files |
| CRPS + publication base payment | Around €8, the official starting line item |
| Notary / certification / signature / power of attorney | Roughly €50–200+ on a simple file, can be higher with foreign documents |
| Registered address | From around €50 + VAT for address-only service, rising to about €280/month for serviced packages in Budva |
| Formation lawyer / advisory | A band of roughly €500–1,500 is common on the market |
| Initial accounting setup / first months | A monthly band of roughly €50–150 is common for a simple company |
My on-the-ground line is shorter: incorporation is "cheap"; running the file cleanly and sustainably "doesn't have to be cheap." Especially if you want a foreign founder, a power of attorney, sworn translation, bank KYC paperwork and a proper registered address in Budva, the total budget breaks away from the 1-euro myth very quickly. The idea of "I'll leave it dormant and close it later" also often turns out expensive; the topic of a dormant company and company closure needs to be addressed separately as well.
The Official Tax Picture for 2026
The mistake I correct most often here is this: corporate income tax in Montenegro is no longer a flat 9%. The tiered structure, in force since 2025, is as follows:
| Tax | Main rule as of 30 June 2026 |
|---|---|
| Corporate income tax | Up to €100,000 at 9%; €100,000.01–€1,500,000 at €9,000 + 12% on the excess; over €1,500,000 at €177,000 + 15% on the excess |
| VAT (PDV) standard rate | 21% |
| VAT (PDV) reduced rates | 15% and 7%; 0% on some transactions |
| Mandatory VAT registration threshold | Turnover over €30,000 in the last 12 months or a shorter period |
| Dividend / profit distribution | Generally 15% applies on the distribution side; may change with treaties and special exemptions |
What does this table mean in practice? A company that earns €100,000 in profit calculates €9,000 of corporate income tax. A company that earns €300,000 no longer pays €27,000 by saying "still 9%"; on a rough calculation it comes to around €33,000. On €2 million of profit, the burden rises to roughly €252,000. For the client who arrives expecting a "flat 9% tax," that is the first point I correct.
The threshold matters with VAT too. If your turnover exceeds €30,000 in the last 12 months or a shorter period, the registration application is made by the 20th of the following month at the latest; the tax authority issues the registration decision within seven days, and the VAT number is used by prefixing the PIB with "ME." If you are below the threshold, voluntary registration is possible, but that decision should be made according to your sector and customer type.
On dividends, I keep it short with the client: the story doesn't end when the company makes a profit — you also need to see the second layer of tax on distribution. The Corporate Income Tax Law sets the general withholding framework on dividend/share payments made to legal persons at 15%; the Personal Income Tax Law likewise provides for a 15% rate on the capital income of natural persons, dividends included. If there is a double-tax treaty in place, or if the conditions for the EU parent-subsidiary exemption are met, the result may change; you have to look at it file by file.
The Regular Burden That Starts After Incorporation — and the Most Common Mistake
The file is not finished the day the company is formed. Monthly accounting, filings, payroll if there are employees, invoicing and the actual operating rhythm all begin that day. Here I say only this: the "set it and forget it" expectation is not real in Montenegro either. I cover the detailed mechanics under the heading of Montenegro tax and accounting.
The three mistakes I see most often are clear. The first is treating the €1 capital as the total cost of incorporation. The second is still imagining corporate income tax as a flat 9%. The third is assuming VAT registration is mandatory at the moment of incorporation — or, the opposite, failing to see the risk of late registration once the €30,000 threshold is crossed. When I lay these out cleanly for the client at the start of the file, the later feeling that "hidden costs came up" largely disappears. To set up your file correctly, you can get in touch with us as part of our Montenegro company formation service.
General information note: This text is for general information purposes as of 30 June 2026; the effects of the notary, the bank, licensed activities and double-tax treaties must be separately confirmed on a file-specific basis.
