VAT
The VAT rates are as follows:
- The standard VAT rate – 18% (for most taxable supplies);
- The lower VAT rate – 8% (for basic food stuffs, daily newspapers, utilities etc.).
In addition to these tax rates, there is a 0% tax rate with the right of deduction of the input VAT which applies to export of goods, transport and other services in direct relation with export, 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.
The input VAT is the VAT calculated and paid by a taxpayer to its supplier on purchasing goods and services. The output VAT is the VAT which a taxpayer calculates and charges on goods and services provided to customers. A taxpayer can offset the input VAT against its output VAT. However, the input VAT paid on some products and services (such as cars, motorcycles, entertainment costs, home electric appliances) cannot be deducted against the VAT calculated on output.
VAT is payable at each stage of the turnover of goods and services, as well on the import of goods.
The taxable base is the fee for products and services sold, including customs duties, excise taxes paid, transportation and insurance costs or any other cost relating to the sale of goods and services.
Tax liability arises on the first day that any of the following events occur:
- The sale of goods and services;
- The collection of a fee, if the fee or a part of the fee has been collected prior to the sale of goods and services;
- The day on which customs duty is applied (in case of imported goods).
There are two reporting periods for the VAT:
- Each calendar month for taxpayers whose turnover in the previous 12 months was over RSD 20,000,000 (or approximately €230,000) or who predict that turnover in the next 12 months will be above the RSD 20,000,000 threshold; or
- For taxpayers whose turnover is between RSD 2,000,000 and RSD 20,000,000 the reporting period is 3 months.
