Foreigners who have income in the territory of Albania are also subject to the declaration if they managed to earn more than 2 million lek (Euro 14,000) in 2012
TIRANA, April 10 – Tax authorities have reminded all individuals of their legal obligation to declare their income for 2012 in case they earned more than 2 million lek (Euro 14,000) warning of punishments in case of abuses by its identified risk groups. With only few days to go before the deadline for the declaration of income expires on April 30, the General Tax Administration has reminded all individuals Albanians, and foreigners in Albania to fill in their application forms in case their gross income from wages, bonuses, rents, bank accounts, dividends and profits from small businesses, gambling winnings, and gross income coming from outside the territory of Albania exceeded 2 million lek for 2012.
Tax authorities say doctors, financial experts, notaries public, lawyers, dentists, engineers, artists, journalists, sportspeople and journalists have been identified as risk groups with possible income of more than 2 million lek annually after the first declaration of income in September 2012.
Tax authorities launched a probe after the first voluntary declaration of income unveiled only a small number of people with annual revenues of more than 2 million lek (Euro 14,000), the threshold to make the declaration. The move came after the General Tax Directorate recently announced that only 4,440 people, out of an expected 100,000 filled in their declaration of income last year.
Besnik Nuredini, the deputy director of the General Tax Office says the administration has started verifying all people who have made the declaration and all those who earn more than 2 million lek but do not declare it with the tax authorities. Investigations will mainly focus on doctors, dentists, notaries public, lawyers and bailiffs.
“Investigation has shown that a considerable number of these businesses hide their tax revenue and declare low or medium-sized wages,” say tax authorities.
The opposition Socialist Party described government’s initiative of the declaration of income for individuals with annual revenue of 2 million lek as a complete failure after the official deadline expired on October 1, 2012.
The Finance Ministry launched an awareness campaign on the process in mid-September only two weeks before the expiry of the deadline.
“Each individual with gross annual income from all sources at 2 million lek or more has the obligation to complete the annual declaration of personal income by April 30 2013. The goal of completing this declaration is the formalization of revenue over 2 million lek secured by individuals, the increase in the self-declaration of revenue and the equipment of individuals with the fiscal code,” says the ministry.
The declaration also contains the option of voluntarily filling in the application for individuals who in 2011 had annual revenue of up to 1.05 million lek in order to benefit from deductible expenses for their children’s education, medical expenditure and voluntary insurance.
Foreigners who have income in the territory of Albania are also subject to the declaration.
Under the initial version of the law, only self-employed people with annual income of up 2 million lek, and individuals with personal income of up to 200,000 lek would be excluded from the declaration. The threshold was later raised to 2 million lek to reduce the number of declarations.
Financial experts say it will be difficult for Albanians to adjust to the system and for the government to implement the complicated deductible and refund system it has approved.
The changes make it compulsory for any individual or business with annual gross income of 2 million lek or more to submit an income declaration by April 30, 2012. The difference between total gross income and deductible expenses will be taxed by 10 percent
People making false statements risk fined and up to two years of imprisonment.
