Montenegro is a beautiful place to live in. It has gorgeous coasts, where most seasonal foreigners go, and Podgorica, its capital, has all the comforts of any other developed city, but on a smaller scale. Montenegro is known as one of the most affordable countries in Europe. That is especially true when considering the excellent quality of life the country offers. Renting a two-bedroom apartment in a good zone of Podgorica costs around €600 per month. Not in your wildest dreams, you can find those prices in Madrid, London, or Prague.
Services (electricity, water, gas, etc.) are also cheaper than in most places in Europe. Depending on the season and what you have in your home, they may go from €50 to €100. Monthly bus passes cost around €20 per month. Also, the nightlife in Budva and Kotor, the most touristic zones, is not expensive. €50 should do it at a fancy restaurant, and for a night out, €30-40 are usually enough unless you’re looking for something more luxurious.
Likewise, there is a good public healthcare system, but as private insurances are not expensive, most expats decide to acquire one. They usually cost around €300 a year, and a visit to the doctor costs around €25 to €35, depending on your consultation.
All this has led Montenegro to be a leading destination for retirees across Europe. Real estate prices are low but are rising, meaning that investing in it is cheap and brings significant potential returns. Likewise, the cost of living is low but offers the same comfort and services than other European countries, but with a calm ambiance, beautiful sights and architectonical wonders.
What about the tax optimization possibilities? Montenegro has a robust 44 tax treaties network. If your country hasn’t signed a tax treaty with Montenegro, the country offers tax reliefs up to the amount of tax paid in another country on income from that country. The relief is equal to the tax paid in that other country but cannot exceed the tax that would be paid in Montenegro.
Let’s say a simple example. Imagine that you have a €100,000 yearly foreign income, and you live in Montenegro, but your home country doesn’t have a double tax treaty with Montenegro. The income tax rate of your home country is 25 %. That means you must pay €25,000 in taxes (let’s not complicate the example with deductions and such). However, as Montenegro tax rate is 9 % on your first €9,000 (the national average) and 11 % from that amount. Hence, your tax relief will be calculated as follows:
9 % tax on your first €9,000 = €810
11 % tax on the remaining €91,000 = €10,010
That’s total tax relief of €10,820. That means that from a €25,000 you should pay in taxes in your home country, you’ll get a relief that will lower your tax payments to €14,180.
Montenegro is a fantastic destination for expats. Locals warmly welcome foreigners, there’s a well-established expats community, services are excellent, the country is simply gorgeous, and it offers an amazing life quality for a fraction of the cost in Europe.