Income Tax Prepayments under Albania’s Law 29/2023 – How to Appeal When Installments Lack Legal Basis

By KONSULENCE.AL – Tax advisory and representation in administrative procedures

Throughout 2026, many sole traders (persona fizikë tregtarë, “PF”) and small businesses in Albania have received income tax prepayment installments set by the Regional Tax Directorates (DRT) on the basis of the previous year’s annual declaration. In many cases these installments are correct and fully provided for by law. But there are situations where the legal basis for the installments no longer holds – and in those cases the taxpayer has the right to contest them through the administrative appeal procedure.

This article explains how prepayments work, when they can be challenged, and the concrete steps of the appeal process, drawing on our direct experience with successful cases before the Tax Appeals Directorate (Drejtoria e Apelimit Tatimor, DAT).

1. What are income tax prepayments?

Article 63 of Law No. 29/2023 “On Income Tax” requires taxpayers to pay the current year’s tax in advance, in installments, calculated on the basis of the tax liability of the previous year(s). The installments are credited against the final liability when the annual declaration is filed.

The law also allows (Article 63, paragraph 4) the taxpayer to request a reduction of installments where the current year’s profit is expected to be significantly lower than the previous year’s.

2. The special case: a sole trader invoicing only one client (Article 69)

One of the most contested situations in practice concerns sole traders who, according to a previous year’s data, invoiced only one entity. In such cases the tax administration treats the income under a presumption of an employment-like relationship and sets prepayment installments on that basis.

The problem arises when circumstances change: if during the current year the taxpayer invoices several distinct, independent clients, the condition on which the installments were based no longer exists. This is not merely a profit-reduction request under Article 63/4 – it is an argument that the installments themselves lack legal basis. That distinction is essential and must be articulated clearly in the appeal.

3. Two different routes – don’t confuse them

Situation	Correct route
You expect lower profit than last year	Request to reduce installments (Art. 63/4, Law 29/2023)
The legal conditions for the installments are no longer met (e.g. you now invoice multiple clients)	Challenge the legal basis → administrative appeal (Art. 106 ff., Law 9920/2008)

In our experience, DAT explicitly asks appellants to clarify which of these two routes they are pursuing. An appeal wrongly framed as a “reduction request” can be dismissed even where the lack-of-legal-basis argument is strong.

4. The appeal procedure, step by step

Step 1: Initial request to the Regional Tax Directorate (DRT)

Start with a documented request to the DRT, usually through the e-Filing platform (the “My Cases” section). Keep the case numbers and dates – you will need them later as evidence that you exhausted preliminary communication.

Note: DRT responses are often given only inside the e-Filing system, without a formally numbered letter. This is normal, but it should be explained expressly in your appeal, because DAT may ask for the DRT’s “official response.”

Step 2: Administrative appeal to DAT

If the DRT refuses or directs you to the appeal route, file an administrative appeal with the Tax Appeals Directorate at the Ministry of Finance, based on Article 106 ff. of Law No. 9920/2008 “On Tax Procedures in the Republic of Albania”.

The appeal should contain:

• Full identification of the taxpayer (name, NIPT, address, contacts);
• The administrative act or action being contested and the date of notification;
• The legal basis of the appeal and the substantive arguments;
• Evidence: for Article 69 cases, a complete table of invoices issued during the current year to different clients, with their NIPTs, dates and amounts;
• The history of communication with the DRT (e-Filing case numbers, dates);
• The specific request (cancellation of the imposed installments).

Deadline: the appeal must be filed within 30 calendar days of notification of the contested act.

Step 3: Documentation completion

DAT frequently replies with a formal letter requesting clarifications or additional documents (based on the procedural points of Instruction No. 24/2008). The typical response deadline is 15 days. Missing it can result in the appeal being dismissed on procedural grounds without examination of the merits.

Step 4: Decision and the judicial route

DAT examines the appeal and issues a decision. If the decision is negative, or if no response is received within the statutory period, you have the right to bring the matter before the Administrative Court within the deadlines set by administrative court legislation.

5. Practical tips from our experience

1. Document everything from the start. Every e-Filing case, every email with the inspector, every letter – all of it becomes evidence.
2. The invoice table is your key exhibit. For Article 69 cases, a structured table of all current-year invoices (clients, NIPT, dates, amounts) is the most persuasive argument. State that the list reflects the situation as of the filing date and that additional clients are expected during the year.
3. Don’t stop payments without advice. Until the appeal is resolved, the administration may send reminder notices for unpaid installments. Reply in writing, explaining that the matter is under administrative appeal pursued precisely on the tax authority’s own recommendation.
4. Respect deadlines strictly. 30 days for the appeal, 15 days for documentation completion – these deadlines are preclusive.
5. Frame the legal basis precisely. The correct legal framing (lack of legal basis vs. reduction request) often determines the outcome.

6. Legal framework and useful links

• Law No. 29/2023 “On Income Tax” – Articles 63 (prepayments) and 69
• Law No. 9920/2008 “On Tax Procedures in the Republic of Albania” – Article 106 ff. (administrative appeal)
• Instruction No. 24/2008 of the Ministry of Finance – procedural provisions on appeals

Official sources:

• General Directorate of Taxes: tatime.gov.al
• e-Filing platform: tatime.gov.al
• Ministry of Finance (Tax Appeals Directorate): gov.al
• Official Publications Centre (consolidated law texts): gov.al

Have you received prepayment installments you believe lack legal basis?

KONSULENCE.AL has direct experience preparing and pursuing administrative appeals before the Tax Appeals Directorate, including Article 69 cases involving sole traders. Contact us for an assessment of your situation.

This article is for general information only and does not constitute legal or tax advice for specific cases. Legislation changes; always verify the current text of the laws through official sources.