North Macedonia gives a foreign company a simple tax picture: income from work, self-employment and dividends is taxed at a flat 10%, a single-member company pays 10% profit tax or none at all on small revenue, and payments from abroad move freely onto foreign-currency accounts. A Macedonian contractor can be paid as an individual on a service contract, with no registration, and declare the income each month. What needs care is paperwork on the contractor’s side, which the Public Revenue Office (UJP) now checks against bank data, and a written IP transfer, which Macedonian copyright law requires in a specific form.
Individual, trgovec poedinec or DOOEL
| Form | Income or profit tax | Contributions (2026) | When it fits |
|---|---|---|---|
| Individual on a service contract | 10% on income from work, self-assessed monthly through the e-PDD | See below | Occasional or part-time work, no registration |
| Individual trader (trgovec poedinec) | 10% on revenue less expenses; keeps books | On a base of at least MKD 34,570 a month | A registered sole business with real expenses |
| DOOEL (single-member limited company) | 10% profit tax; exempt up to MKD 3 million revenue; 1% of revenue from MKD 3 million to 6 million | Depend on how the owner is paid | Contractors who hire others or keep profit in a company |
Sources: income from work and the tax base for self-employment from the Law on Personal Income Tax, Arts. 14 and 21 (isos.mk, checked 2026-09-29); the flat rate from PwC Tax Summaries and the company regime from PwC corporate (both reviewed 2026-07-23); the contribution base from ujp.gov.mk (checked 2026-09-29).
A DOOEL needs EUR 5,000 of share capital and is registered through the Central Registry’s one-stop shop, normally within four hours and in two to three business days in practice (investnorthmacedonia.gov.mk, checked 2026-09-29). For a foreign client the form changes the paperwork more than the price: an individual needs a monthly payment confirmation from you, while a trader or company sends you invoices.
Tax on income from a service contract
The Law on Personal Income Tax treats income under a contract for occasional or temporary services to domestic or foreign legal and natural persons as income from work, the same category as salary (Art. 14). Since 1 January 2023 that income, like self-employment income, dividends and royalties, has been taxed at a flat 10% (PwC Tax Summaries, reviewed 2026-07-23).
When you pay from abroad, no one withholds the tax, so the contractor files an e-PDD advance return through UJP’s e-tax system by the 10th of the month after the income arrived. The system converts foreign currency at the National Bank’s middle rate on the day of receipt, a UJP official approves the return, and the tax is paid by the 15th. The contractor must attach evidence: a confirmation from the payer, a bank statement, the services contract or similar documents (ujp.gov.mk, announcement of 1 December 2025, checked 2026-09-29).
The same announcement says UJP checks the data it receives from banks on foreign inflows and calls in people who received money from abroad in past years without reporting it. Residents include anyone who stays in the country more than 183 days in any 12-month period, so a foreign developer living in Skopje is in scope too. Tax paid abroad on the same income reduces the Macedonian tax only up to the 10% it would have been.
Contributions
The Law on Contributions sets 18.8% for pension and disability insurance and 7.5% for health insurance, with smaller rates for unemployment and workplace-injury cover (Art. 25; trudovopravo.mk, consolidated text to Official Gazette 251/2022, checked 2026-09-29). For employees the total is 28% of gross salary (PwC Tax Summaries, reviewed 2026-07-23).
A self-employed person, including a trgovec poedinec, pays on the monthly advance of net income. The base cannot fall below 50% of the average salary, and for a self-employed person providing professional or other intellectual services it cannot fall below the full average salary (Art. 15). With the 2026 average gross salary at MKD 69,141, the general floor is MKD 34,570 a month and the ceiling for the self-employed MKD 829,692 (ujp.gov.mk, checked 2026-09-29). A company manager who is not insured through employment or self-employment also pays on their fee (Art. 7).
The same consolidated text lists employees, company managers and the self-employed among the people who pay contributions; income from an occasional service contract is not on that list. UJP’s guidance on foreign income deals only with the 10% tax. A contractor who works full-time as an individual should confirm their position with a Macedonian accountant.
VAT
The standard rate is 18%. A business must register once turnover in the previous calendar year exceeds MKD 2,000,000 (PwC Tax Summaries, reviewed 2026-07-23), about €32,430 at the National Bank’s 29 September 2026 rate (nbrm.mk, checked 2026-09-29). Under the VAT rulebook adopted in January 2024, the supplier establishes the place of supply of a service to a business with a certificate of the client’s VAT or similar registration number (EY, checked 2026-09-29). A VAT-registered trader or DOOEL may ask you for that certificate before the first invoice.
Reclassification risk
The Labour Relations Law defines the employment relationship as one in which the worker voluntarily joins the employer’s organised work process for pay and performs the work personally and continuously, following the employer’s instructions and under its supervision (Art. 5). An employment relationship is established by signing an employment contract (Art. 13) (aa.mk, consolidated text, checked 2026-09-29). A developer who works your hours, on your equipment and only for you matches the Art. 5 description, whatever the contract is called.
The law is due to change. In February 2026 Deputy Minister Marjan Risteski said a new Labour Relations Law covering remote work, work from home and digital platforms was one of the year’s main goals, with agreement hoped for by the end of 2026 (pari.com.mk, checked 2026-09-29). Contracts signed now should be reviewed once it passes.
On the tax side, the contractor’s fee already sits in the same category as salary. A foreign client whose contractor is found to be an employee should also consider whether the work creates a permanent establishment. See contractor misclassification.
Multi-client, project-scoped work on the contractor’s own schedule and equipment is low-risk. Exclusive, full-time work under your direction is where the risk concentrates.
Contract and IP
- A written services contract with the contractor’s details (tax number for a trader or DOOEL), scope and deliverables, a rate in euros or another stated currency, and payment terms.
- A monthly payment confirmation for an individual, since UJP asks for one with each e-PDD.
- Independence markers: the contractor’s own schedule, tools and right to work for other clients; no attendance control or holiday approval.
- A written transfer of economic rights. Under the Law on Copyright and Related Rights, economic rights pass only by written contract, and an unwritten one has no legal effect. The contract should state which rights are transferred, their scope, whether exclusive, the territory, the duration and the fee, and unclear terms are read in the author’s favour (Art. 65). A transfer of copyright as a whole, of moral rights or of uses not yet known is void (Art. 67). For commissioned work the author keeps the copyright unless a law or contract says otherwise (Art. 85) (zamp.mk, unofficial consolidated text, checked 2026-09-29). List the rights explicitly, including modification and sublicensing, worldwide and for the full term of protection.
- Expect a fair-share clause you cannot exclude. If use of the work earns far more than the agreed fee, the author may ask for the fee to be revised, and cannot waive that right (Art. 66).
- With a DOOEL, check the chain. Economic rights in software an employee writes pass to the employer without limit unless agreed otherwise (Art. 87), so the DOOEL holds its employees’ code. Code from its own subcontractors needs written transfers before the DOOEL can pass the rights to you.
Taxes and paperwork on the client’s side
A foreign client pays gross and withholds nothing. US payers collect a W-8BEN (W-8BEN-E from a DOOEL) and file no 1099: personal service income is sourced where the work is done (irs.gov, checked 2026-09-29). North Macedonia is not on the IRS list of income tax treaty partners (irs.gov, checked 2026-09-29); for work done in North Macedonia that changes nothing for the payer. Keep the contract, the invoices or monthly confirmations, and payment references.
How to pay contractors in North Macedonia
Most payments are euro transfers to the contractor’s foreign-currency account. Since 7 October 2025 they can go by SEPA credit transfer, first through nine Macedonian banks (bankarstvo.mk, checked 2026-09-29), which costs the recipient far less than a SWIFT inflow. Dollars still travel by SWIFT, and Wise does not yet send denars. Current payments with non-residents are free under the Law on Foreign Exchange Operations, but residents settle with each other in denars (crm.com.mk, Arts. 4 and 6, checked 2026-09-29). Rails, receiving fees, what breaks and a ranked list of platforms are on our page how to pay contractors in North Macedonia.
Contractor of Record in North Macedonia
For a few contractors who work for several clients, a direct services contract is usually enough. A Contractor of Record makes sense for the other cases: a full-time engagement with one client that matches the Art. 5 description of employment, or a team whose contracts, monthly confirmations and IP transfers have to stay consistent. 4dev acts as Contractor of Record — the contracting party for each contractor — which reduces reclassification risk. Other providers also sign with the contractor as the counterparty; read the liability clause in the COR contract, not the product name. Where the role is a job in substance, hire through an EOR instead. Compare providers in our COR rating.