Changes for VAT payers from January 1

By the end of November, the Serbian National Assembly is expected to pass a package of tax laws directly related to structural reforms and announced improvements to the business environment.

According to State Secretary of the Ministry of Finance Slavica Savicic, the amendments to the VAT Law are of particular importance for the economy, since they introduce the gradual creation of all prerequisites for the preliminary VAT refund. Business.rs reports.

Key amendments to the VAT Law

One of the main changes clarifies the situations in which the supply of goods and services is not considered completed. This includes the transfer of all or part of the assets without VAT, provided that the recipient continues the same business activity. The provision also applies to goods replaced under warranty, which will no longer be subject to additional tax.

Free business samples and promotional materials in limited quantities are now clearly defined as VAT exempt. However, if the conditions of the exemption change within three years, the recipient is required to subsequently assess VAT, which imposes additional obligations on the business.

For transactions involving price changes or adjustments to the tax base, the law now defines the procedures in more detail. If the price increases, taxpayers must immediately calculate and report the additional VAT. However, price reductions are only permitted if there is written confirmation from the client that the previous VAT deduction has been corrected.

For services for which compensation is included in the customs value of imported goods, the VAT base will now be the difference between the total amount of compensation and the part included in the customs value. This change is especially relevant for companies dependent on import activities.

Adjustments to previous VAT deductions

When the tax base for supplies of goods and services changes due to an increase or decrease, taxpayers must adjust the deduction of the previous VAT. Specific cases such as reduction of advance payments, cancellation of invoices or corrections based on court decisions are now clearly regulated. Additionally, adjustments must be made during the period of changes in the tax base.

Special benefits for farmers

Farmers will be entitled to a VAT refund of 8% on the value of agricultural products and services they supply. Payments will be made in cash, and businesses purchasing these goods and services will be required to issue receipts.

Farmers whose turnover does not exceed eight million dinars will not be required to register for VAT. However, they can voluntarily accept VAT obligations, gaining the right to preliminary VAT deductions and other benefits. This voluntary registration is mandatory for a minimum of two years.

Advanced late serve control

The updated law also requires VAT payers to keep detailed records, calculate and pay VAT in accordance with the law, and submit tax returns on time. The introduction of clear accounting and settlement procedures is intended to facilitate supervision and increase the efficiency of VAT collection.

Businesses with a turnover exceeding eight million dinars during the previous 12 months must register for VAT within five days of reaching this threshold. Lack of registration entails mandatory registration with the tax authorities.

Regarding the termination of VAT obligations, the law provides for a procedure for deregistration of those who no longer meet the criteria for paying VAT. Taxpayers must submit an application for deregistration no later than 15 days before ceasing to operate. In the event of a change in legal status, successors assume all VAT obligations.

(Business and Finance, 11/20/2024)

https://bif.rs/2024/11/sta-se-sve-menja-za-pdv-obveznike-od-1-januara/

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