- Law on Tax Administration ("Official Gazette of the Republic of Montenegro", No. 065/01 dated 31.12.2001, 080/04 dated 29.12.2004, 029/05 dated 09.05.2005, “Official Gazette of Montenegro", No. 073/10 dated 10.12.2010, 020/11 dated 15.04.2011, 028/12 dated 05.06.2012, 008/15 dated 27.02.2015, 047/17 dated 19.07.2017)
- Law on Administrative Procedure ("Official Gazette of Montenegro", No. 056/14 dated 24.12.2014, 020/15 dated 24.04.2015, 040/16 dated 30.06.2016, 037/17 dated 14.06.2017)
Enforced collection procedure shall be undertaken when a taxpayer fails to pay his tax liability when submitting the tax return or when the tax decision becomes enforceable. The Tax Administration shall initiate the enforced collection procedure by adoption of the conclusion on enforced collection of tax liability.
The taxpayer shall bear the costs of enforced collection.
The conclusion on enforced collection shall contain inter alia: 1) tax return reference, or enforcement order and date when the tax return is recorded, or when the order becomes enforceable; 2) the amount of tax debt according to maturity, amount of interest and costs of the procedure; 3) order to the taxpayer to pay his tax debt within 10 days; 4) case reference and means of enforced collection; 5) number of the account to which the payment shall be made; 6) the taxpayer’ s debtor’ s reference; 7) more detailed identification of immovable property in accordance with the data from the public book; 8) note that costs of the enforced collection procedure shall be covered by the taxpayer; 9) name of the Tax Payer and his registered office. (2) If the enforced collection is made against wages, pensions and other personal earnings of the taxpayer, the conclusion on the enforced collection shall also be submitted to his Tax Payer.
Appeal may be lodged against the conclusion on enforced collection within three days as of the day of its delivery. The appeal shall not stay the enforcement of the conclusion.
The following may be subject to enforced collection: 1) monetary assets of the taxpayer; 2) monetary claims of the taxpayer; 3) property (movable and immovable) of the taxpayer. Enforced collection may be carried out against one or several aforementioned items.
In the procedure of enforced collection of a tax liability, a security interest may be imposed on the property of the taxpayer for the purpose of securing the tax claim. The referred security interest shall be imposed in the manner envisaged by the law governing pledge or mortgage.
Transfer of funds from the taxpayer’s account to the account to which tax liabilities are paid shall be used to carry out enforced collection from monetary assets of the taxpayer.
Enforced collection from the monetary assets of the taxpayer shall be executed in the manner and pursuant to the procedure prescribed by the law governing civil enforcement procedure. The conclusion on the enforced collection shall be submitted to the Central Bank of Montenegro for the purpose of its execution.
Enforced collection of tax liability against the property of the taxpayer shall mean the seizure and sale of the taxpayer s property (movable or immovable) and use of proceeds obtained by sale or other procedure for collection of the tax liability. Property of the taxpayer that may be seized and sold shall include the property and property-based rights that belong to the taxpayer, regardless whether he or another person physically possesses that property. The conclusion on the enforced collection shall be submitted to the taxpayer whose property is to be seized or to another person if that person possesses the property of the taxpayer or is his debtor on another basis.
Tax inspector shall carry out the seizure in the presence of two witnesses. The taxpayer shall be entitled to be present during the seizure procedure. The seizure shall consist of inventory-taking and appraisal of property. Any person possessing the property to be seized shall be obliged to surrender or pay the amount reflecting the value of that property to the tax inspector at his/her request. In case when a person other than the taxpayer holds the taxpayer’s property subject to seizure, the property may be seized only on the basis of a court decision adopted in the enforcement procedure.
For adopting the such decision, the Tax Administration shall also enclose with the request submitted to the court the proofs of the existence of tax debt, that the person possesses cash or other means from which the tax could be collected, and that the collection attempt was unsuccessful. The seizure procedure shall last until the tax liability is paid, or the procedure of enforced collection is terminated.
The tax inspector shall take minutes on the seizure including, which includes the following information: 1) the name of the Tax Administration and the name of the tax inspector conducting the collection procedure; 2) last and first name, firm, permanent residence or headquarters of the taxpayer, TIN and data on other persons witnessing the seizure; 3) time and place of the seizure; 4) amount of tax debt, interest and costs of the seizure procedure; 5) name, reference and description of seized objects; 6) value of the seized objects according to the performed appraisal; 7) last and first name, address, or headquarters of the person to whom the property is given into custody; 8) statement that the taxpayer and the custodian of seized objects have been warned of the consequences of divesting of or damaging the seized property; 9) objection of the taxpayer and other persons to the procedure of appraisal and seizure, the persons performing the appraisal, appraised amount or other objections, or objections of other persons.
In cases when the presence of the police is required, their presence shall be recorded in the minutes on the seizure. The tax inspector conducting the procedure, the taxpayer, his proxy or authorized person or a member of his household, proxy or authorized person, debtor of the legal entity, witnesses, appraisers and other officials witnessing the seizure shall sign the minutes. If the taxpayer or his proxy or authorized person, or the representative of authorized person or the debtor legal person refuses to sign the minutes, the note thereof shall be entered into the minutes. The taxpayer and other persons from whom the property is seized shall each be provided with a copy of the minutes. The tax inspector shall be obliged to notify about conducted inventory all persons pointed out as owners of the inventoried property or part of that property, and instruct them that they may file an extracting complaint with the competent court, for the purpose of proving the ownership right on the respective property, within 8 days from the day of receiving the notification. The tax inspector shall deliver verbally the referred notification if those persons witness the inventory taking procedure, and shall enter it into the minutes on the inventory and appraisal of movable property, whereas the absent persons shall be notified in writing. If the notified persons prove that they have filed the extracting complaint with the court within eight days, the collection procedure shall be suspended in respect of the property covered by the extracting complaint.
Timely filed extracting complaint with the court shall postpone the seizure and sale of the inventoried movable property the complaint relates to until the termination of the dispute, and that property shall remain for safekeeping with the taxpayer.
The taxpayer shall be obliged to safe keep the property in the unaltered condition until the termination of the dispute in respect of extracting complaint. If it is determined in the extracting complaint procedure that the person who filed the extracting complaint is not the owner, and the taxpayer divests of, destroys or damages the property, criminal charges shall be brought to the prosecutor of relevant jurisdiction. In the such case, for the purpose of securing the collection of debt, a new inventory and appraisal of the property shall be made without any delay.
The Tax Administration shall be held responsible for the seized property. If monetary assets are seized, the Tax Administration shall deposit them to the appropriate account of the budget within one business day as of the day of seizure. The Tax Administration that implemented the seizure of the property shall publish the advertisement of the sale of the property in the public information media and on the bulletin board of the Tax Administration, within 5 days as of the day of seizure.
Officials of the Tax Administration, spouses, ancestors and descendants of the officials, and the ancestors and descendants of officials’ spouse may not participate directly or indirectly in the public bidding.
The taxpayer whose property is seized in accordance with the law may, prior to the sale of the property, settle the tax liability and costs of the seizure. The Tax Administration shall return the seized property to the taxpayer the following day from the day of the settlement of the tax liability. In case when the seized property is perishable or when the Tax Administration estimates that there are exceptionally important circumstances justifying urgent sale, the sale may be executed through direct negotiations.
Proceeds generated through the sale of the seized property shall be used for the settlement of the tax liability.
The provisions of the law governing the civil enforcement procedure shall be accordingly applied to exemptions, security procedure, inventory of the property and other issues related to enforced collection.