How is income tax on wages calculated in Kosovo?

Under Law No. 08/L-142, from September 2024, wages at the main employer are taxed at 0% up to EUR 250 a month, 8% from EUR 250.01 to EUR 450 and 10% above EUR 450. The annual equivalents are EUR 3,000 and EUR 5,400. Secondary employers withhold a flat 10%.

What are the pension contributions?

Employees and employers each contribute 5% of gross salary to the Kosovo Pension Savings Trust, and employees can make optional additional contributions. Contributions are declared and paid together with payroll tax by the 15th of the following month.

What if an employee works for two employers?

The main employer applies the progressive bands of 0%, 8% and 10%, and any secondary employer withholds a flat 10%. We check each employee's status so the right treatment is applied at each employer.

Can you run payroll for a foreign company without a local finance team?

Yes. Once your Kosovo company or branch is registered with ARBK and has its unique identification number (NUI), we can run payroll, file declarations through EDI and prepare payment slips for your bank. You approve each payroll remotely through the portal.

How do you keep payroll data confidential?

Payroll data sits in the secure portal, with access limited to named people on your side and ours. We handle personal data in line with GDPR and Kosovo's Law on Personal Data Protection, and never share it beyond what filings require.

Payroll and HR

Payroll and HR compliance, right every month

Payroll in Kosovo looks simple until a rate changes, an employee takes a second job or a contract is missing a clause. We calculate pay, withhold tax, declare pension contributions and keep contracts and personnel files in order. You approve each payroll before it is paid.

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Payroll and HR

Accurate payroll, pension and tax withholding every month, with contracts and personnel files kept compliant.

Payroll administration
Employment contracts
HR compliance
Leave management

3 days

Draft payroll sent for your approval three working days before pay day

15th

Payroll tax and pension declarations filed by the statutory deadline

24h

Response to employee payroll queries on working days

Scope

Payroll and HR, handled end to end

Payroll administration

We calculate gross to net pay each month, apply the correct income tax bands for main and secondary employers, and calculate the 5% employee and 5% employer pension contributions to the Kosovo Pension Savings Trust. Declarations and payments are made through EDI by the 15th of the following month.

Gross to net calculation and payslips
Income tax withholding at 0%, 8% and 10%, or a flat 10% for secondary employment
Pension contributions, including optional additional contributions
Bank payment file and payment slips

Employment contract management

Every employee needs a written contract that matches the Labour Law and the way they actually work. We draft and review contracts, track the end dates of fixed-term contracts and keep every amendment on file.

Contract templates for permanent, fixed-term and part-time roles
Review of existing contracts against current law
Alerts before fixed-term contracts expire
Amendments for changes to pay, role and working time

HR compliance

Labour law obligations go beyond the contract: working hours, overtime, notice, termination and workplace policies. We review where you stand, document the gaps and help you close them before an inspection or a dispute.

HR compliance review against the Labour Law
Internal regulations and workplace policies
Guidance on overtime, notice and termination
Support during labour inspections

Personnel file management

A complete file for each employee: contract, identification, qualifications, payroll history, leave records and signed policies. Files are stored digitally in the portal, with access limited to the people who need it.

Standard file checklist for every employee
Digital storage with restricted access
Document packs for joiners and leavers
Retention aligned with data protection rules

Leave management

Annual leave, sick leave, maternity leave and public holidays are tracked for every employee and reflected correctly in pay. Managers see balances and employees get clear answers.

Leave entitlements calculated per employee
Sick and maternity leave reflected in payroll
Public holiday calendar for Kosovo
Leave balances reported each month

Deliverables

What you receive

Monthly payroll calculation for your approval
Payslips for every employee
Payroll tax and pension declarations filed through EDI
Payment slips and a bank payment file
Payroll journal posted to your accounts
Employment contracts and amendments
Complete digital personnel files
Monthly leave and headcount report

How it runs

From the first review to ongoing support

Collect
We gather employee data, contracts, current pay and leave balances, and check them against your latest declarations.
Correct
We fix gaps in contracts, files or past calculations and agree a monthly payroll calendar with you.
Run
Each month you report changes in the portal, we calculate payroll and you approve it before payment.
Declare
We file tax and pension declarations through EDI by the 15th and issue the payment slips.

Who it is for

Clients we do this for

01Employers of any size with staff in Kosovo
02Foreign companies hiring their first employees in Kosovo
03Technology companies with fast-growing teams
04Construction and manufacturing businesses with shift or seasonal staff
05Companies that want payroll kept confidential and outside the office

In the client portal

From monthly changes to filed declarations

Upload payroll files, new contracts and leave requests to the portal, and our team does the rest. Each payroll is visible before payment, every declaration and payment slip is stored, and the payroll summary appears in your dashboard.

Payroll summary by month, department and cost
Contract register with renewal and expiry alerts
Compliance calendar with every payroll deadline
Secure messaging for payroll questions

Explore the client portal

Payment slip

VAT, October 2026

€3,412.80

Issued

Beneficiary: Kosovo Tax Administration (ATK)
Reference: VAT 2026-10
Due date: 20 Nov 2026

Illustration with sample data

FAQ

Questions clients ask

Hand payroll to a team that knows the rules

Send us your headcount and current setup, and we will propose a monthly fee and a start date.