The VAT means a general consumption tax that is assessed and paid on the delivery of goods and provision of services in all stages of production and sales of goods and services, as well as on the import of goods, unless otherwise provided by the VAT Law.
The subject of the VAT shall be the following:
- Delivery of goods and provision of services carried out by a taxpayer in Serbia for a charge, in the conduct of its business;
- Import of goods into Serbia.
The standard VAT rate is 20% for most taxable cases. A reduced VAT rate of 10% applies to certain goods and services (e.g., basic food, newspapers, drugs, public transportation services, utilities etc.).
In addition to these tax rates, there is a 0% tax rate with the right of deduction of the input VAT that applies to the export of goods, certain services (e.g., IT services), transport and other services directly related to exports, international air transport, etc.
A 0% tax rate without the right of deduction of the input VAT applies to trading in shares and other securities, insurance and reinsurance, and the lease of apartments, business premises, etc.
VAT liability arises when the first of the following occurs:
- supply of goods or services;
- collection of advance payment;
- import of goods.
The taxpayer has to calculate the “reverse charge” on certain services provided by non-residents in Serbia (if the non-resident has not appointed a fiscal representative) and may deduct this as input VAT in the same VAT return if the basic deductibility requirements are met. If the taxpayer is not registered in VAT, there is no possibility to ask for a refund, so the paid service in this case will be increased by VAT rate.
If the input tax amount is higher than the tax liability amount, the taxpayer is entitled to a refund of the difference in 45 days. The taxpayer can also choose not to ask for refund so the difference will be treated as a VAT prepayment and carried forward for offsetting future VAT liabilities.
NDP Audit & Consulting offer a comprehensive VAT service to clients in what can be a very complex area. Our team of VAT specialists have the practical experience and technical knowledge to deal with all aspects of the VAT in Serbia. We provide assistance to our clients with all their VAT obligations including:
- high level VAT reviews identifying VAT saving opportunities, compliance efficiencies and potential exposures,
- advise on issues such as the VAT treatment of all transactions (goods, services, etc);
- Representing clients before Tax Authority in all controls;
- VAT compliance services including VAT registration, VAT returns and cross-border VAT reclaims.
We also act as a support function on a daily basis, providing answers to queries and any other assistance required.