Since 1 January 2024, foreign entities conducting taxable transactions in North Macedonia are required to appoint a VAT tax representative. This obligation was introduced by Article 9-b of the Value Added Tax Law (Official Gazette 199/23) and represents a significant change for foreign businesses operating in the country without a permanent establishment or branch. This page is part of our practice in business and corporate law. For related questions about the VAT in North Macedonia, see our guide on Navigating VAT in North Macedonia for Your Business.

Obligations for Foreign Entities

Foreign entities without a permanent establishment or branch in North Macedonia, engaging in taxable transactions, must register for VAT and appoint a VAT tax representative. Unlike Macedonian entities, these foreign businesses are not exempt from VAT registration based on a minimum turnover threshold. They are required to register prior to commencing taxable activities within the country.

Appointment of a VAT Tax Representative

A foreign entity can appoint only one VAT tax representative. This appointment involves submitting a VAT registration application along with necessary documentation to the Public Revenue Office (PRO). The procedure, detailed in the Ministry of Finance Regulation published in Official Gazette 286/2023, involves submitting the VAT-01/SL-DZ form printed on white A-4 paper.

Required Documentation for VAT Registration

1. A notarized agreement for the appointment of the VAT tax representative, including: the name and address of the foreign entity; the name and address of the VAT tax representative; and the VAT identification number assigned by the PRO to the VAT tax representative.
2. Proof of the foreign entity’s residence in its home country.
3. Proof of the VAT tax representative’s residence or business address in North Macedonia.
4. Proof that the VAT tax representative is not undergoing bankruptcy or liquidation (for legal entities) or has no criminal convictions (for individuals).

Responsibilities of the VAT Tax Representative

The VAT tax representative has several key responsibilities:

• Calculating the VAT due on taxable transactions.
• Submitting VAT returns on a quarterly basis, by the 25th day of the month following the end of the quarter.
• Paying the VAT and any associated interest for late payments.
• Maintaining records on behalf of the foreign entity.

Importantly, the VAT tax representative is jointly liable for the VAT owed by the foreign entity. This joint liability underscores the critical role of the VAT tax representative in ensuring compliance with North Macedonian tax regulations.

Registration and Appointment Process

The process for registering a foreign entity for VAT and appointing a VAT tax representative involves several steps. Upon receiving the VAT registration application and supporting documents, the PRO issues a decision on the registration and appointment.

1. Submit the VAT registration application (VAT-01/SL-DZ form) and required documentation to the PRO.
2. The Public Revenue Office reviews the application and documents.
3. The Public Revenue Office issues a registration decision, confirming the VAT tax representative’s appointment.

Changing or Revoking a VAT Tax Representative

Circumstances may necessitate changing the VAT tax representative or ceasing taxable activities in North Macedonia. In such cases, the foreign entity must submit a new application to appoint a different VAT tax representative or request deregistration.

Situations requiring a change or revocation include:

• Termination of the current VAT tax representative’s appointment for any reason.
• The cessation of taxable transactions by the foreign entity in North Macedonia.

The PRO then issues a decision on the change or revocation.

Qualifications for a VAT Tax Representative

To qualify as a VAT tax representative in North Macedonia, an entity or individual must meet the following criteria:

• Registered for VAT purposes for at least 12 months before the appointment.
• No outstanding unpaid tax liabilities at the time of appointment.
• For legal entities: not undergoing bankruptcy or liquidation.
• For individuals: no criminal convictions.

Practical Implications for Businesses

The introduction of the VAT tax representative requirement aligns North Macedonia with international tax practices, enhancing transparency and compliance. For foreign businesses, this change necessitates careful selection of a qualified VAT tax representative to navigate North Macedonian VAT regulations.

Key considerations for foreign businesses:

• Selecting a knowledgeable and experienced VAT tax representative.
• Ensuring timely and accurate submission of VAT returns.
• Maintaining comprehensive records of transactions.

The VAT tax representative requirement represents a significant development in North Macedonia’s tax landscape. Foreign entities must now engage a VAT tax representative to handle VAT obligations, ensuring compliance with local regulations.

2026 Practical Checklist

Foreign entities conducting taxable transactions in North Macedonia should verify the following: (1) Register before starting activities — unlike domestic companies, foreign entities have no minimum turnover threshold. VAT registration is required before commencing any taxable activity in North Macedonia. (2) Appoint only one VAT representative — only one VAT tax representative can be appointed at a time. Choose carefully: the representative is jointly liable for all VAT owed. (3) Check representative qualifications — the representative must have been VAT-registered for at least 12 months, have no outstanding tax liabilities, and not be in bankruptcy or have criminal convictions. (4) Prepare a notarized appointment agreement — this is a mandatory document for the PRO registration application, along with proof of residence for both the foreign entity and the representative. (5) VAT returns are quarterly — due by the 25th of the month following the end of each quarter. Missing deadlines triggers interest liability for both the foreign entity and the representative. 

Frequently Asked Questions

Which foreign entities need a VAT tax representative in North Macedonia?

Any foreign entity without a permanent establishment or branch in North Macedonia that conducts taxable transactions of goods or services in the country must register for VAT and appoint a VAT tax representative. There is no minimum turnover threshold — the obligation applies from the first taxable transaction.

What is the joint liability of the VAT tax representative?

The VAT tax representative is jointly and severally liable for the VAT owed by the foreign entity. This means the Public Revenue Office can claim unpaid VAT directly from the representative, not just from the foreign entity. This makes the selection of a reliable and qualified representative critical.

How often must VAT returns be submitted?

VAT returns must be submitted quarterly, by the 25th day of the month following the end of each quarter. The VAT tax representative is responsible for submitting the returns and paying any VAT due, including interest for late payments.

Can the VAT tax representative be changed?

Yes. If the current representative’s appointment is terminated for any reason, or if the foreign entity ceases taxable activities in North Macedonia, a new application must be submitted to the PRO to appoint a different representative or request deregistration.

What documents are needed for the VAT representative appointment?

The main documents are: (1) a notarized appointment agreement between the foreign entity and the representative; (2) proof of the foreign entity’s residence in its home country; (3) proof of the representative’s residence or business address in North Macedonia; and (4) proof that the representative is not in bankruptcy/liquidation (legal entities) or has no criminal convictions (individuals). All submitted using the VAT-01/SL-DZ form.

Need legal guidance?

If you need assistance with VAT representative appointment or tax compliance in North Macedonia, the team at Lalicic & Partners is at your disposal. Contact us through our website.