The Value Added Tax (VAT) in Serbia
is applied to the supply of goods and services offered on the market, and to the imported products, but there are also categories of goods exempt from such taxation. When opening a company in Serbia
, one must align with the requirements of the tax regime in this state, including for VAT
for which a firm must be registered before it begins the operations. Our company formation agents in Serbia
can offer assistance and complete information for foreigners interested in setting up a business in Serbia
Information about the VAT imposed in Serbia
From the beginning, we mention the Law on Value Added Tax in Serbia was revised in 2012, but additional modifications were observed each year. In this sense, it is good to know that the standard VAT in Serbia is set at 20% rate for certain goods and services, but there is also a lower VAT rate of 10% which is applicable to special categories like basic food, medicines, bottled water, computers, public transportation, utilities, newspapers, and magazines.
Having knowledge about the taxes which need to be paid in Serbia
will help the entrepreneurs set up their companies in complete agreement with the requirements imposed by the legislation of this country. The company formation in Serbia
is an easy process which can be overseen by our Serbian team of company formation specialists
VAT exemptions in Serbia
In Serbia, there are certain categories of goods and services which are not subject to VAT, such as:
• the export of goods;
• international air transport;
• medical services;
• financial services;
• culture and entertainment;
• organizing of gambling and lotteries services.
VAT in the real estate sector in Serbia
The VAT imposed on the first transfer of the right of use of a real estate property in Serbia is set at 8%. As for the new buildings in Serbia, their prices will comprise a VAT of 20%. Besides that, the property tax in Serbia is set at a rate of 0.4% of the market value and it is imposed once per year for companies which own properties in this country. Besides this tax, a transfer fee or 2.5% rate is issued for real estate properties which are at a certain point subject to ownership transfer. It is good to know that there are no stamp duties in Serbia.
The VAT return in Serbia
The VAT recovery for companies offering goods and services in Serbia will have to comply with a few conditions, mostly related to the needed documents, among which, the confirmation stating that the VAT for imported items has been paid or the invoice with information about the goods that are VAT subject. There are also cases where the VAT cannot be requested back and this rule is applicable to imported items like vehicles, vessels, motorcycles, car parts, household appliances, etc. Also, the VAT imposed for entertainment services and products cannot be claimed. If you believe you need support for VAT registration and returns, we suggest you get in touch with one of our company formation specialists in Serbia who can offer in-depth guidance and assistance. You can also ask for help in matters of company formation in Serbia and speed-up the registration process.
Is there a VAT threshold in Serbia?
No, there is no VAT threshold in Serbia and this means that each product or service sale is subject to VAT, depending on the category of goods.
Do I need a local tax representative in Serbia?
Yes, it is recommended to pay attention to the requirements for VAT registration in Serbia and solicit the support of a local tax representative. You can get in touch with one of our consultants who can represent your company if you are a foreign entrepreneur, especially in company registration and tax registration in Serbia, including VAT.
Is there a VAT for digital products and services in Serbia?
Yes, the digital tax policies apply to site hosting services, internet providers, cloud-based software services, streaming music, audio-visual products like e-books, movies, images, etc. The VAT regime in Serbia might seem complex for digital services and products, and will depend on the amount of sales.
The content of a VAT invoice
All goods and services are sold with an invoice which needs to have a specific content and information. The business name, the invoice date, the VAT number, the customer’s name, the VAT rate
imposed and the final amount are important details comprised by an invoice, regardless of the products or services sold, except the ones where such a tax is not imposed. Companies in Serbia
normally use particular software to issue and send invoices to clients and partners. The status of taxpayer in Serbia
comes with a series of financial responsibilities for which an accountant is needed. If you would like to open a company in Serbia
and need an accounting firm, you can talk to us and ask for support. Besides company formation in Serbia
, you can benefit from the services of an experienced team of accountants. You might find useful the following information about the VAT rate and its applicability for the supply of goods:
The delivery of products manufactured in accordance with the client’s request.
All products which are subject to import and export trading.
The delivery of products or services under a leasing contract involving movable or immovable properties.
Even the transfer of ownership rights, copyrights, patents is subject to such a tax.
The supply of services with compensation enters the VAT category.
We remind that there is a special VAT tax rate of 10% which is applicable to bakery products, plants, milk and dairy, frozen fruits and vegetables, butchery and fish products, cereals, veterinary medicines, fertilizers, accommodation services, communal waste, maintenance of green areas. For specific details about the goods and services subject to VAT, we recommend you talk to one of our specialists. Also, if you are interested in opening a company in Serbia, and you want support, do not hesitate to get in touch with us.
The VAT rule of reciprocity
Under the rule of reciprocity, Serbia can grant the VAT refund
for citizens or companies from the countries where the same rule applies. For example, Serbia signed a series of VAT reciprocity agreements with countries like Montenegro, Slovenia, Germany, Austria, the Netherlands, Norway, Slovakia, Romania, Turkey, Switzerland, Croatia, Belgium, UK, and Macedonia. The VAT refund applies to specific means of transportation, car repairs, car rentals, accommodation and lodging, restaurant
services, related costs of seminars, fairs, and exhibitions. All original invoices, the proof of payment, bank account statements and other specific forms need to be considered for a VAT refund in Serbia
. All the information you need in this matter can be offered by one of our company formation agents in Serbia
Short facts about double tax treaties in Serbia
Serbia signed numerous double taxation agreements
with countries worldwide with the intention of providing extra protection to company profits. The avoidance of fiscal evasion is another important aspect related to the provisions of the double taxation arrangements signed by Serbia. Albania, Armenia, Austria, Azerbaijan, Belgium, Bosnia and Herzegovina, Bulgaria, China, Croatia, Canada, Czech Republic, Cyprus Estonia, Denmark, Egypt, Finland, France, Greece, Ghana, Georgia, Hungary, Italy, Iran, India, Kazakhstan, Indonesia, Libya, Kuwait, Luxembourg, Latvia, Lithuania, Macedonia, Malaysia, Morocco, Montenegro, Malta, Norway, North Korea, the Netherlands, Pakistan, Poland, Qatar, Romania, Russia, Slovakia, Slovenia, South Korea, Sweden, Sri Lanka, Switzerland, Spain, Tunisia, Ukraine, Turkey, UK, the UAE, Uganda, Vietnam, and Zimbabwe are among the countries that signed a double taxation treaty with Serbia. In terms of tax provisions, the exemption is applicable if the company paid the taxes in the country of origin instead of paying the taxes in Serbia where the activities are implemented. There are smaller withholding taxes for interests, royalties, and dividends if mentioned by the double taxation agreement signed with Serbia
. it is important to know that a proof of the paid taxes needs to be made to the Serbian authorities if such taxes have been paid in the country of origin. If you would like to know more about the double tax treaties signed by Serbia we invite you to discuss to one of our company formation agents in Serbia who can also tell you more about how to register for VAT
in this country.
Tax minimization in Serbia – what to consider
is an important tax in Serbia and one that should be considered when having a business in this country, alongside the corporate tax, dividend tax, and many other fees. The importance of having a tax minimization strategy
in the company should be in the attention of both local and foreign investors in Serbia with activities in this country. Tax minimization tools in Serbia should be implemented in companies of any kind in order to avoid overpaying taxes. For example, paying the bills and credits in advance for a couple of months might be subject to varied tax exemptions or lower fees. A tax plan can include tax deductions for bonuses, gifts, office supplies, subscriptions and many more. Charities in Serbia can be excellent options when it comes to tax minimization methods, and that because foundations are not subject to taxation in this country. A complete tax plan can be provided by one of our consultants in Serbia. In terms of accounting
, you should seek complete support from one of our advisors.
Other taxes in Serbia
It is important to pay attention to the tax structure in Serbia
before opening a company in this country as a foreign investor. Besides the VAT imposed on most goods and services in Serbia, one must observe other tax aspects too. For instance, the corporate income tax is set at a 15% rate, one of the lowest among European countries. It is good to know that an exemption of 80% from the corporate tax is applicable in a form of incentive to the royalties of intellectual property owners in Serbia. There is also an excise duty imposed on the import of electricity for final consumption, oil derivates, alcoholic beverages, tobacco products, bioliquids and biofuels, coffee and many more. There are no stamp taxes in Serbia, and non-residents in Serbia
are subject to a 20% rate capital gains tax. Employers in Serbia must pay attention to the taxes and contributions imposed on gross salary. 10% rate is the personal income tax, and 17.15% is the social contribution tax rate paid by the employer.
Why invest in Serbia
Serbia is open for business in most the attractive sectors, no matter if you are a local or a foreign entrepreneur. Oriented towards investors, Serbia offers a series of advantages, especially when it comes to company registration, a procedure that has been simplified quite much in recent years. The tax regime
and the ease of doing business in Serbia
, make international investors look for the investment opportunities in this country. The following facts and figures might convince business persons about the positive direction of Serbia:
• around USD 39.833 million was the total FDI stock for Serbia in 2018.
• the FDIs in Serbia increased by EUR 338 million in April 2019 compared to the same period last year;
• 60% is the rate representing the services that sustain the economy in Serbia;
• Around $25 billion representing the amount of FDIs in Serbia has been registered since 2000.
If you are interested in more details about the VAT in Serbia
but also on how companies can be registered in Serbia
, please feel free to contact
our team of advisors at any time.