By adopting the Law on Amendments to the Law on Compulsory Social Security Contributions (Official Gazette of RS, No. 86/2019) the rate of pension contribution at the expense of the employer is reduced from 12% to 11.5%. The new rate will be applicable from 1.1.2020.
The deadline for using the old employment benefits has been extended to 31.12.2020. From next year, claims for tax refunds and contributions will be submitted on special forms, which will be prescribed by the Minister of Finance by a by-law. The deadline for passing the by-law is April 2020.
The National Assembly is 6.12.2019. adopted the Proposal of Decision on approval of the Decision on amendments to the Financial plan of the Social Security Fund for Military Insureds for 2019, submitted by the Government, as well as the Bill on Amendments to the Law on Contributions for Compulsory Social Security, the Law on Amendments and amendments to the Law on Tax Procedure and Tax Administration, Law amending the Law on Personal Income Tax, Law amending the Law on Republic Administrative Fees, Law amending the Law on Property Taxes, Law amending and amendments to the Law on Pension and Disability Insurance, Proposal of the Law on Termination of the Law on the Temporary Regulation of the Basis for Calculation and Payment of Salaries, or Wages and Other Permanent Remuneration of Public Funds Beneficiaries, Proposal of the Law on Amendments to the Corporate Income Tax Act, Proposal for a Law on Amendments to the Law on Corporate Taxes, Law on holding and carrying goods and the Law amending the Law on the Temporary Regulation of the Method of Charging Public Media Service Fees, submitted by the Government.
We will be releasing a Tax Alert soon regarding financial and tax laws.
In Official Gazette no. 75/2019 of 23.10.2019. Rulebook on the determination of telecommunications services and services provided electronically, within the meaning of the Law on VAT, and on establishing criteria and assumptions for determining the headquarters, permanent establishment, residence or residence of the recipients of telecommunications, radio and television broadcasting services and services provided electronically, has been published.
You can read our Tax Alert here (link).
Employee benefits in respect of gifts for children for the New Year and Christmas are not considered earnings up to the amount of the prescribed non-taxable amount, which is now 9,784 dinars per year per child.
Gifts of greater value than non-taxable amount, gifts to children of employees over 15 years of age, as well as gifts to employees are treated as employee earnings.
The non-taxable amount of gifts refers to gifts in cash and gifts in goods.
If both spouses work with the same employer, each of them as an employee is entitled to a gift for children on New Year’s or Christmas.
If the employer organizes a New Year’s program for the children of employees on the occasion of New Year or Christmas, by engaging theater groups or independent artists, the payment is made on the basis of the copyright contract.
It is proposed to extend the deadline for updating the data in the Central Registry for the applicants for the single application for compulsory social security by another year, ie until December 31, 2020.
Namely, after 28 years, Serbia has adopted a new Codebook of occupations, which includes jobs that have emerged in the labor market in the last three decades. The Unique Nomenclature of Occupations from 1990 has been in use so far.
By the end of 2019, employers are under an obligation to update their employee data according to the new Codebook of occupations. As of January 1, 2020, only a new codebook covering 3,641 occupations will be used, and the list is aligned with the needs of the economy and labor market in Serbia, as well as with the international standard.
The Government of the Republic of Serbia has adopted the Proposal of the Law on Amendments to the Law on Real Estate Brokerage and Leasing.
Among other things, the draft law provides for the amendment of Article 5, which defines the conditions for entry in the Register of Real Estate Brokers:
1) An entrepreneur or at least one natural person who establishes a company or another member of a company, or at least one full-time employee must have passed the professional examination referred to in Article 11 of this Law;
2) There must be a valid insurance contract concluded in accordance with Article 13 of this Law;
3) There must be adequate business premises in accordance with Article 14 of this Law;
4) The protective measure referred to in Article 32, paragraph 2 and Article 33, paragraph 4 of this Law, which is in force at the time of application, must not be imposed;
5) A member of a company, a real owner or entrepreneur, a representative of a company or manager, if the entrepreneur has entrusted the management of a business to a capable natural person, who have a registered predominant activity of a real estate agency, as well as natural persons with the professional examination referred to in Article 11 of this Law, legal persons may not be sentenced to a criminal offense for a fine or natural persons sentenced to imprisonment for a criminal offense in the Republic of Serbia or a foreign country.
The person referred to in item 1) of the Law, must be a full-time employed person and must have passed the professional exam, while under the applicable law it was possible to hire a person outside of employment.
The draft law stipulates a general condition of eligibility that candidates must fulfill when passing the professional examination for brokerage, which is that they cannot be sentenced to imprisonment for criminal offenses in the Republic of Serbia or a foreign country. The Law is scheduled to enter into force on January 1, 2020.
(Opinion of the Ministry of Finance, No. 011-00-916/2019-16 as of 29 October 2019)
The provisions of Article 6, paragraph 1 of the Law on Accounting (“Official Gazette of the RS”, No. 73/2019 – hereinafter: the Law) stipulate that legal entities and entrepreneurs, within the meaning of this Law, shall be classified as micro, small, medium and large legal entities, depending on the average number of employees and business income in the business year and the value of total assets determined at the balance sheet date of the regular annual financial statements.
As the new classification rules take effect on 1.1.2020 and it is stipulated that from 1.1.2020 the provisions of the old Accounting Law relating to classification cease to apply, the new rules apply to classification beginning in 2020 (based on data from the 2019 Annual Financial Report).
With regard to other provisions of the Act relating to e.g. bankruptcy estate, the possibility of applying IAS / IFRS by micro-entities, the obligation to prepare and submit corporate governance reports, reports on payments to government authorities, the part related to non-financial reporting, etc. these provisions do not relate to the preparation of the financial statements for 2019, but will be applied starting with the financial statements, which are to be prepared as at 31.12.2020 (reports for 2020).
The Law on Amendments to the Law on Personal Income Tax and the Law on Contributions for Compulsory Social Security stipulate the extension of the deadline for the use of old tax benefits for the employment of new persons until 31.12.2020.
However, it is stipulated that claims for tax and contributions refunds should be submitted on special forms which will be prescribed by the Minister of Finance.
The Law on Amendments to the Law on Personal Income Tax introduces the Entrepreneurship Independence Test to be introduced on 1.3.2020. Five of the nine criteria finally proposed were corrected, following public hearings held in Belgrade, Niš, Novi Sad and Kragujevac.
After the changes, the criteria are:
1. the principal or related party with the principal determines the working hours of the entrepreneur, or the vacations and absences of the entrepreneur depend on the decision of the principal and the compensation to the entrepreneur is not reduced in proportion to the time spent on vacation;
2. the entrepreneur normally uses premises or conducts business in a place designated by the principal or a related person with the principal for the purposes of performing the tasks entrusted to him;
3. the principal or related person with the principal performs or organizes professional training or further training of the entrepreneur;
4. The principal has hired the entrepreneur after advertising in the media the need to engage individuals or by hiring a third party who is normally engaged in finding suitable people for employment and whose service has resulted in the engagement of that entrepreneur;
5. The principal or a related party with the principal provides its own basic tools, equipment or other basic tangible or intangible assets necessary for the regular work of the entrepreneur or finances their acquisition, except for specialized tools, equipment or other specialized tangible or intangible assets for the purpose of executing a specific job or order, either the principal or a related party with the principal normally manages the process of work of the entrepreneur, except for such management which entails giving a basic order in connection with the ordered job and reasonable control of the results of work or supervision of the principal, as a good businessman, over the performance of the work he has commissioned;
6. at least 70% of the total income of the entrepreneur or in the period of 12 months beginning or ending in the tax year concerned has been generated by one principal or a related party with the principal;
7. the entrepreneur performs activities which are officially defined as activities of the principal or related party with the principal, and for such performed activities his engagement contract does not contain a clause under which the entrepreneur bears the usual business risk for the job delivered to the client of the principal or related person with the principal, if such a client exists;
8. the contract for hiring an entrepreneur or a lump sum entrepreneur contains a partial or complete ban on the entrepreneur to provide services under a contract with other principal, except for a partial prohibition that includes the provision of services to a limited number of direct competitors to the principal;
9. the entrepreneur performs activities for a fee for the same principal or for a related party with the principal, continuously or intermittently for 130 or more business days for a period of 12 months beginning or ending in the respective tax year, whereby performing activities in one working day are considered to be any activity in any period during that working day between 00 and 24 hours.
After the adoption of the amendments to the Law on personal income tax, employees will have to document to their employers all expenses for coming to work, except if the employer pays a monthly transport pass by direct payment through the invoice to the city carrier.
The most recent changes – through the addition of Article 18, paragraph 1, item 1) – add the word “documented”, which means that reimbursement of transportation costs will have to be documented, so each employee will need to present an invoice.
If he does not document the expense, he cannot use the prescribed non-taxable amount, and that amount will have to be calculated and tax paid.
The law is expected to enter the parliamentary procedure during November 2019, and implementation is expected as of January 1, 2020.
According to the Opinion of the Ministry of Trade, Tourism and Telecommunications, no. 011-00-00373 /2019-03 dated 24/09/2019 the goods in transit must be accompanied by documents that are directly related to the carriage of the goods and which in particular contain: the number and date of the document, business name, address, PIB and registration number or agricultural holding (BPG), or the number from the relevant register of the supplier, consignee and carrier (if any), location and address of the facility from which it is delivered and to which it is delivered, the name, surname and signature of the responsible persons of the supplier and carrier, the name of the goods and the quantity. The documents may be the original or a copy. The documents may take the form of an electronic document.
Therefore, the Opinion stipulates that the documentation containing the information prescribed by Article 29 of the Law on Trade (“Official Gazette of the RS”, No. 52/2019), which is in electronic form in a tablet, is considered an electronic document.
The new Law on Auditing has been published in the Official Gazette of RS, no. 73/2019 from 11.10.2019 and shall enter into force on 1 January 2020. You can find an overview of the new law in our Tax alert.
In accordance with the opinion of the Ministry of Finance, no. 011-00-616 / 2019 of 20/08/2019 If, for the purposes of treatment of a natural person, a legal entity (in which the physical person is not employed) provides and pays certain funds for the purposes of treatment in the appropriate health institution abroad (as stated, treatment in Serbia could not be carried out without risk and with great lasting harmful effects) by paying the funds in the amount of part of the costs of treatment directly into the personal account of a natural person who previously paid the costs of treatment to the account of that medical institution according to the invoices of the medical institution from abroad conducting the treatment from his / her personal account, we believe that the income received by an individual in this way has the character of non-taxable receipt.
Serbia was removed from the European gray list of tax jurisdictions, i.e. the list of jurisdictions that do not cooperate in tax matters. In July 2019, Serbia signed the Convention on Mutual Administrative Assistance in Tax Matters (MAC), which is 30.08.2019 endorsed by the Serbian Parliament and will be from effective 1.12.2019.
Specifically, in December 2017, the EU drafted a black and gray list of tax jurisdictions, after identifying ways companies and individuals seek to avoid tax obligations. A place on the gray or black list for countries means poorer reputation and tighter controls in transactions with the EU.
The EU Council of Ministers of Ministers also removed Albania, Switzerland, Costa Rica and Mauritius from the gray list. United Arab Emirates were removed from the black list, while the Marshall Islands switched from black to gray. Blacklisted countries are American Samoa, Belize, Fiji, Guam, Oman, Samoa, Trinidad and Tobago, Vanuatu and the US Virgin Islands.
The Convention on Mutual Administrative Assistance in Tax Matters was developed jointly by the OECD and the Council of Europe in 1988 and amended by Protocol in 2010. The Convention is the most comprehensive multilateral instrument available for all forms of tax co-operation to tackle tax evasion and avoidance.
The Convention facilitates international co-operation for a better operation of national tax laws, while respecting the fundamental rights of taxpayers. It provides for all possible forms of administrative co-operation between states in the assessment and collection of taxes. This co-operation ranges from exchange of information, including automatic exchanges, to the recovery of foreign tax claims.
The Ministry of Economy has prepared a draft Law on Amendments to the Company Law, which is scheduled for public debate to be held in the period 10-29. October.
The draft provides for the following:
- detailed regulation of the treatment of own shares (application from 1.4.2020)
- the possibility of distributing retained earnings to employees (Article 270)
- increasing the threshold for remuneration of members of the board of directors, that is, the executive and supervisory boards from 3% to 5% of shares within the business year (Article 282)
New Law on Accounting was adopted by the Assembly. More details in our Tax alert.
Among other changes, the amendment of the Corporate Income Tax Law is expected to be enforced by the end of year.
The most important change concerns additional reporting on business within international groups, which has already been implemented in almost all European countries. The report is intended to be aligned with the BEPS. According to BEPS Action Plan 13, all large multinational enterprises (MNEs) are required to prepare a Country-by-Country report with aggregated data on the global allocation of income, profits, taxes paid and economic activities among the tax jurisdictions in which they operate. This CbC report is shared with tax administrations in these jurisdictions, for use in high level transfer pricing and BEPS risk assessments.
The amendments to the Law define an international group of related legal entities as a group of entities that are interconnected by ownership or control in terms of IASs or IFRSs, and whose total consolidated income is recognized in the consolidated financial statements for the period preceding the reporting period at least EUR 750 million in RSD equivalent at the average exchange rate of the National Bank of Serbia at the date of adoption of the consolidated financial statements, and:
- one or more of group members has an obligation to prepare, present, submit and disclose consolidated financial statements in accordance with IAS or IFRS, or would have that obligation if it were a legal entity whose shares are traded on a regulated market in the Republic Serbia or outside Serbia
- in which at least one legal entity is a resident of another tax jurisdiction in relation to other members of the international group, or at least one legal entity is a resident of one tax jurisdiction and is subject to taxation in another tax jurisdiction based on performing business activity through a permanent establishment.
The CbC report will be submitted no later than 12 months after the end of the business year for which the annual report is submitted, and the Minister of Finance, relying on sources related to good practice in reporting on controlled transactions of the OECD, will be closer to arrange the conditions and manner of submission of the annual report. The first application of this requirement is for the tax period beginning in 2020.
Other amendments are regarding the capital gain, i.e. loss of investment funds, as well as the granting to bank (as taxpayer) the right to a tax credit of 2% of the remaining debt determined in accordance with the Law on conversion of home loans indexed in CHF.
The Draft Law on Amendments to the Law on Tax Procedure and Tax Administration was published, which among other things:
- regulates in more detail the connection with the Bankruptcy Law,
- Introduces an act that will regulate the procedure, manner, deadlines content and form of the statement by which the taxpayer will declare the business premises, which will be adopted by the Minister, on the proposal of the Director of the Tax Administration,
- that the PIB (tax number) cannot be awarded to an entrepreneur who has tax debt incurred in connection with the activities in other economic entities in which he is at the same time a founder with a share of more than 5%;
- banks becomes obliged to provide data on taxpayers’ accounts at the request of the Tax Administration,
- the delivery of the tax act is regulated in more detail
- it is regulated that the Tax Administration shall take over the tasks of maintaining a unified information system of local tax administrations, no later than 1.1.2021.
Through the announced amendments to the Law on Personal Income Tax, it will be proposed to increase the non-taxable amount of earnings from RSD 15,300 to RSD 16,300.
Also, the planned amendments to the Law on Compulsory Social Security Contributions include a reduction of the total pension and disability insurance contribution rate from 26% to 25.5% (this refers to the reduction of employer contribution from 12% to 11.5%)
Incentives have also been announced for citizens who have not stayed in Serbia in the past two years, which would reduce the basis for calculating taxes and contributions by 70% in the next five years if they return and find employment in Serbia.
Also, from 1.1.2020. employers who increase the number of employees and employ persons who have not been employed during 2019 will be exempted from paying 70% of payroll taxes and contributions for social contributions for those persons during 2020, or 65% during 2021 and 60 % during 2022.
As announced by the Government of the Republic of Serbia, the amendments to the Law on Personal Income Tax, which would enter into force on January 1, 2020, in the next few weeks will be brought before the National Assembly. A proposal of a set of measures for youth employment would include amendments to the law, as and tax incentives for the companies that employ them. One of the most significant changes being proposed is the introduction of a independence test for entrepreneurs. The tax administration will be tasked with determining whether hiring an entrepreneur is a simulated job, or whether hiring an entrepreneur creates a employer/employee relationship.
The introduction of eleven criteria for the independence test has been announced, and if six out of eleven are fulfilled, the entrepreneur will be deemed not to meet the independence requirement:
1. The principal defines working hours.
2. There is a competition clause in the contract.
3. The entrepreneur is entitled to holidays and absences for a fee and is approved by the principal.
4. The principal advertises the positions for which he / she hires an entrepreneur or for that purpose he / she recruits employment agencies.
5. The entrepreneur performs work for the principal by working in a team with employees or other entrepreneurs.
6. The entrepreneur uses the premises provided or owned by the principal.
7. The principal trains entrepreneurs and manages the work process.
8. The entrepreneur uses tangible and intangible assets for the work provided by the principal.
9. The entrepreneur generates at least 70% of the income in 12 months from the principal.
10. The entrepreneur performs business activities of the principal and does not assume business risk towards clients of the principal.
11. The entrepreneur has been engaged by the principal for more than 130 days in 12 months.
If a company employs a person who she/he had previously hired as a entrepreneur and the person was not employed during 2019, a partial exemption is provided for payment of salary taxes and social contributions:
1. 70 During 2020, 70% of taxes and contributions
2. 65 During 2021, 65% of taxes and contributions
3. 60 During 2022, 60% of taxes and contributions
The Government of Serbia adopted Proposal of the Law on Accounting on 16.9.2019.
According to the Report on the Public Hearing on the Draft Law on Accounting, published by the Ministry of Finance, the following comments or suggestions are accepted fully or partially:
- Clearer wording in certain definitions in Article 2 of the Draft Law (other legal entities, extraordinary financial statement, shares, material item, date of approval for disclosure of financial statements),
- Specifying that the Central Registry, Depository and Clearing of Securities (Central Registry) is considered a large legal entity and that the Securities Commission prescribes by-laws governing the Chart of Accounts and the contents of the Account in the Chart of Accounts, as well as the content and form of financial forms reports compiled by the Central Registry.
- Comments from civil sector representatives related to other legal entities within the meaning of Article 2, item 2) of the Draft Law on Accounting (associations, foundations, endowments, etc.), which will continue to apply the special by-laws governing them, are also accepted. Chart of Accounts and Forms of Financial Statements (provisions as in the current Law on Accounting).
- The remark specifying Article 9, paragraph 3 of the Draft Law was adopted, in the sense that compulsory creation and submission of invoices in electronic form refers to legal entities and entrepreneurs obliged to apply this Law, and the deadline for compliance with this provision of the Draft Law (mandatory implementation starting January 1, 2022).
- Remarks regarding the obligation to draw up a Note to the financial statements for other legal entities referred to in Article 2, paragraph 2 of the Draft Law, which are classified in the category of micro legal entities, were also accepted.
- An objection was also accepted regarding the establishment of the Accounting Services Provider Register (starting from January 1, 2021).
- In the part related to non-financial reporting, proposals were adopted to further specify the obligation to prepare and how to prepare these reports.
Other suggestions, suggestions and objections of the participants in the public hearing process submitted to this Ministry after the analysis were not accepted because no specific explanations were given for them, or the proposals are contrary to the positive legal regulations, i.e. are not subject to the regulation of this law, or are contrary to the provisions of the relevant EU regulations (Directive 2013/34 / EU and Directive 2014/95 / EU as well as EU Regulation 1606/2002) with which they are harmonized.
The Law on Amendments to the Law on Value Added Tax is currently in the parliamentary procedure. It is stipulated that this Law will enter into force eight days from the day of its publication in the Official Gazette of the Republic of Serbia, and its implementation will commence on 1.1.2020 except for the provisions relating to Article 24 (tax exemptions for the circulation of goods and services with the right to deduct prior tax) and Article 26 (tax exemptions for the importation of goods) of the present Law and provisions containing the powers to adopt by-laws to be applied from the day the entry into force of this Law.
These are some of the changes proposed in the Value Added Tax Act and also you can download our Tax alert:
Value Vouchers – It is proposed to divide the vouchers into one-purpose and multi-purpose ones and to determine the difference between the tax treatment of their transfer.
One-purpose vouchers are those for which the place of delivery of goods / services is known at the time of the value voucher. All other vouchers are multi-purpose vouchers. The obligation to calculate VAT will exist at the moment of issue with single-purpose vouchers, while the obligation to calculate VAT on multi-purpose vouchers will exist at the moment of their realization.
Turover of goods carried on board, in an aircraft or train – It is suggested that the place of turnover of goods carried on board, in an aircraft or train during the transport of passengers is considered the place of departure of the ship, aircraft or train and the place of departure, departure place is the first scheduled place for embarking passengers. It is suggested that the return journey is considered a separate transport.
Also, in determining the place of turnover in the services of sale of food and drinks for consumption, which are actually provided on board, that is, in an aircraft or train during the transportation of passengers, it is proposed to apply the above rule.
Residence / abode – It is also envisaged to add a paragraph defining that if the residence and abode of the provider or recipient of the service are not in the same place, the place of turnover of the service is determined according to the place of abode.
Turnover of telecommunication, radio and television broadcasting services and services provided electronically – in case of turnover of telecommunication, radio and television broadcasting services and services provided electronically, place of establishment, permanent establishment, residence or abode of the recipient of services shall be considered to be a place determined on the basis of criteria and assumptions for determining the place of establishment, permanent establishment, residence or abode of the recipient of those services.
Tax liability – It is stipulated that a tax liability will occur on the earliest date, inter alia, the invoicing of the services referred to in Article 5, paragraph 3, item 1) of the VAT Law is made, including services directly related to those services as well as technical services support for the use of software, hardware and other equipment for a specified period of time.
Tax exemptions for the circulation of goods and services with a right to deduct previous tax – The amount of the total value of the goods delivered (through which VAT can be refunded) that the passenger takes abroad in personal luggage, for non-commercial purposes, changes to RSD 6.000 from previous EUR 100.
Implementation of highway construction infrastructure projects – Provision is made for a tax exemption with the right to deduct previous VAT on goods and services performed within the
framework of the implementation of highway construction infrastructure projects for which a public interest has been established by a special law.
Pre-tax split and prorated tax deduction – Specifies which sales of goods and services are not considered in determining the prorated deduction percentage and specifies that a taxpayer is not required to split the pre-tax under this law if the prorated deduction percentage is at least 98 %.
A complete change to Article 44, which now reads – If the VAT payer in the invoice for goods and services supplied shows a higher amount of VAT than the one who owes in accordance with this law, i.e. the amount of VAT without having to pay the obligation in accordance with this law, the stated VAT is to be paid.
The VAT taxpayer referred to in paragraph 1 of this Article shall have the right to correct the VAT amount if he has issued a new invoice with a corrected VAT amount, that is, an invoice without VAT and if he has a document of the recipient of the invoice stating that the VAT stated in the original invoice was not used as previous tax.
The new invoice referred to in paragraph 2 of this Article must contain a note that the invoice replaces the previously issued invoice.
The person who declares VAT in the invoice, who is not liable for VAT, is obliged to pay the declared VAT.
The person referred to in paragraph 4 of this Article shall not have the right to correct the stated amount of VAT.
The minimum wage, excluding taxes and contributions for compulsory social security, for the period January – December 2020 will be 172.54 RSD (net) per hour. The current minimum labor cost is 155.30 din per hour. Therefore, the net minimum wage for payments during 2020 will be:
- 27.606,40 RSD per month with 160 working hours
- 28.986,72 RSD per month with 168 working hours
- 30.367,04 RSD per month with 176 working hours
- 31.747,36 RSD for the month with 184 working hours
The gross minimum wage depends on the non-taxable amount that will change from 1.2.2020. It was announced that the social contributions the expense of the employer would be reduced.
All payments that will be made from 1.1.2020 should be calculated at 172,54 RSD per hour, regardless of the month to which the calculation relates.
In accordance with the opinion of the Ministry of Finance No. 011-00-920 / 2018-04 of 10.7.2019. the tax exemption with the right to deduct the previous tax for the shipment of goods abroad, i.e. for the export of goods, can only be obtained by the taxpayer – the owner of the goods being exported, if he / she possesses evidence of the export of goods. Namely, it is a person who ships goods abroad and is listed in JCI for export of goods (box 2) as the sender / exporter – the person on whose behalf the declaration is submitted and who, at the time of accepting the declaration, owns the goods or has similar rights to dispose of goods.
The Ministry of Finance, in collaboration with USAID, has prepared a draft Rulebook on services provided electronically, within the scope of VAT Law. The aim of the new Rulebook is to align legislation with new services and new ways of providing services in the digital age.
The draft supplements the provisions of the existing Rulebook defining services provided electronically, and introduces provisions on determining the place of supply for telecommunications, radio and television broadcasting services and services provided electronically when such services are provided to a entity which is not taxpayer.
From 8/13/2019 taxpayers may inquire about the status of property tax liability for the territory of the Republic of Serbia through the application for mobile phone “My LPA”, which is free and available in versions for Android and iOS operating system.I
In order to complete the inquiry, it is necessary to obtain a username and password, for which the taxpayers personally submit a request to the competent local tax administration (LPA). Individuals should contact the local tax administration by place of residence, while legal entities should contact the local tax administration by registered headquarters address.
The National Health Insurance Fund (RFZO) has published on its website a list of required documentation for exercising the right to remuneration for the period of temporary absence from work for more than 30 days, to be paid at the expense of RFZO before and after April 11, 2019.
The list of required documentation can be seen at the following link.
On the website of the Finance ministry, a draft law on accounting is published, which should enter into force on 1 January 2020. The link contains the most important changes compared to the current applicable law of accounting.
The Companies Act provides that company documents sent to third parties should include, inter alia, the company identification number. Failure to comply with this provision constitutes a misdemeanor for which a fine for companies is stipulated (between RSD 100.000 and RSD 1.000.000).
The new Trade Law further defines that the registration number is a mandatory element of the documents accompanying goods (documents on production, purchase and sale of goods, as well as documents accompanying goods in transport).
Failure to present the appropriate documents accompanying the goods results in a fine for a misdemeanor of RSD 500.000 to RSD 2.000.000 dinars for legal entities, and RSD 50.000 to RSD 500.000 dinars for entrepreneurs.
The Ministry of Finance has issued a Notice regarding taxation of income from the provision of catering services in domestic crafts and rural tourism households by an individual.
The Rulebook on Terms, Criteria and Elements for Taxation of Revenues Based on the Provision of Hospitality Services was previously published. The Regulation is effective from 1.7.2019. and taxable income from the provision of hospitality services is calculated on the basis of the following:
– 5% of average monthly earnings in the year preceding the taxable year,
– number of single beds and camping pitches and
– coefficient by category of tourist destination.
Implementation of the Law on Lobbying begins on 14 August 2019. The Law regulates the lobbying activities, the rules of lobbying, registers, records and other important issues.
Lobbying can be carried out by either an individual or a legal entity who is registered as lobbyist, but the Law also recognizes “unregistered lobbyist” – a legal representative or an employee of a lobbying beneficiary or a company/association to which the lobbying beneficiary is a member. Foreign citizens and foreign legal entities may also act as lobbyists in Serbia, but only if they have been properly registered for lobbying in the country of their origin, as well as in national register administered by the Anti-Corruption Agency.
All registered lobbyists are required to submit An Annual Written Report to the Serbian Anti-Corruption Agency by January 31 of the following year.
A necessary precondition for registration of a lobbyist is the attendance of the Training Program for Lobbyists and passing the Written Test of Knowledge.
At the session held on August 8, 2019, the Executive Board of the National Bank of Serbia decided to cut the reference by 0,25 percentage points to 2,5%. The next session of the Executive Board should be held on September 12, 2019.
Interested parties may submit their comments and suggestions in the comment form, in writing to the Ministry of Finance, at the address: Kneza Miloša 20, Belgrade, with the note: “For public debate on the Draft Law on Accounting”, or “For public debate on the Draft Law on audit” or electronically to the following e-mail addresses: email@example.com, firstname.lastname@example.org, email@example.com.
The new Personal Data Protection Act, which was passed last year, will begin to apply on August 21, 2019. The law imposes a number of obligations on all legal entities, especially those who operate with a large number of users and perform data processing of any kind, and prescribes harsh penalties for non-compliance with the Law. The main reason for adopting the Act is to comply with EU regulations.
The law applies in cases where the data processor having his / her headquarters, domicile or residence in the territory of the Republic of Serbia processes personal data in the scope of activities performed in the territory of the Republic of Serbia, regardless of whether the processing operations are carried out in the territory of the Republic of Serbia. Also, irrespective of the seat, residence or domicile of the data processor, the Law also applies to data processing cases where the data subjects have their place of residence in the Republic of Serbia, in two cases – in the case of supply of goods and services, and in the case of monitoring the activities of persons if the activities are carried out in the Republic of Serbia.
After 28 years, Serbia has adopted a new Codebook of occupations, which includes jobs that have emerged in the labor market in the last three decades. The Unique Nomenclature of Occupations from 1990 has been in use so far.
By the end of 2019, employers are under an obligation to update their employee data according to the new Codebook of occupations. As of January 1, 2020, only a new codebook covering 3,641 occupations will be used, and the list is aligned with the needs of the economy and labor market in Serbia, as well as with the international standard.
On our website you can access the tax alert regarding the new “Rulebook on exercising the right to tax exemption based on the organization of recreation, sporting events and activities for employees”.
With the new opinion of the Ministry of Finance 011-00-97 / 2019-04 from 10.07.2019 the problem that occurs when the VAT payer issues the wrong invoice is resolved. Namely, if the VAT payer misrepresents the VAT in the invoice or other document serving as the invoice, the VAT taxpayer is obliged to pay the stated VAT until he corrects the error in the new invoice, but the recipient of the invoice (VAT payer) is not entitled deduct VAT until it receives the correct invoice.
The new opinion stipulates that the VAT taxpayer who issued the wrong invoice has the right to reverse the invoice, for example by creating a special document which should contain information on the number and date of the wrong invoice to be reversed, as well as to submit that document to the buyer. The VAT taxpayer who created the wrong invoice and recorded it in his information system is obliged to keep records of wrongly made invoices and documents on the basis of which those invoices were canceled.
Prilikom isticanja cene i naplaćivanja turističkih aranžmana u inostranstvu ubuduće će se primenjivati zvanični srednji kurs dinara. To je propisano novim Zakonom o trgovini, koji je usvojila Narodna skupština Republike Srbije. Ovakvo rešenje prihvaćeno je tokom izrade predloga zakona, a na predlog Narodne banke Srbije.
Na ovaj način rešeno je dugogodišnje pitanje naplate turističkih aranžmana po prodajnim kursevima banaka za devize ili efektivni strani novac. Rešenjem iz novog Zakona o trgovini cene turističkih aranžmana postaju u potpunosti uporedive i predvidljive jer neće zavisiti od dnevnih prodajnih kurseva koje utvrđuju banke.
Ovim rešenjem, korisnici usluga turističkih agencija imaće mogućnost da sa velikom izvesnošću planiraju iznos izdatka u porodičnom budžetu za plaćanje turističkih aranžmana koji se realizuju u inostranstvu, budući da će im cena takvog aranžmana biti iskazana i naplaćena primenom zvaničnog srednjeg kursa dinara, koji je zahvaljujući naporima i aktivnostima Narodne banke Srbije, već nekoliko godina unazad na stabilnom nivou i bez većih oscilacija.
Pored toga, turističke agencije, koje su do sada korisnicima njihovih usluga turističke aranžmane preračunavale i naplaćivale primenom prodajnog kursa banke kod koje imaju otvoren račun, iako su u praksi devize kupovale po povoljnijim kursevima, neće biti više u mogućnosti da ostvaruju dodatnu zaradu po osnovu kursnih razlika, a na teret klijenata.
Ukazujemo da su, prema dosadašnjim propisima, ali i prema novom zakonu, trgovci dužni da cene po pravilu iskazuju u dinarima, dok samo izuzetno mogu da cenu istaknu u stranoj valuti, kao što je to slučaj u trgovini uslugama u turizmu koje su u neposrednoj vezi sa inostranstvom. Međutim, u tom slučaju, prema novom zakonu trgovac mora da pri isticanju i naplaćivanju cene naznači i kao obračunski kurs primenjuje isključivo zvanični srednji kurs dinara.
Novi Zakon o trgovini objavljen je u „Službenom glasniku Republike Srbije“ broj 52/2019 i stupa na snagu osmog dana od dana objavljivanja – 30. jula 2019. godine.
The official middle exchange rate of the dinar will be applied in the future when dealing with pricing and billing of tourist packages abroad. This is prescribed by the new Law on Trade, which was adopted by the National Assembly of the Republic of Serbia. This solution was accepted during the drafting of the bill, and at the proposal of the National Bank of Serbia.
In this way, the long-standing issue of collecting tourist arrangements by using ask rate of commercial banks or effective foreign currency was resolved. The decision from the new Law on Trade in the Prices of Tourist Arrangements becomes completely comparable and predictable because it will not depend on the daily sales rates determined by the banks.
With this solution, users of tourist agency services will have the opportunity to plan with great certainty the amount of expenses in the family budget for payment of tourist arrangements that are being made abroad, since the price of such arrangement will be presented and collected using the official middle exchange rate of the dinar, which, thanks to the efforts and activities of the National Bank of Serbia, for several years is stable and without major oscillations.
In addition, travel agencies, who until now have calculated and charged travel arrangements for the users of their services using the selling rate of the bank with which they have opened an account, although in practice they bought foreign currency at more favorable rates, will no longer be able to earn additional earnings on the basis of exchange rates difference, and at the expense of clients.
We state that according to the current regulations, but also according to the new law, traders are obliged to show prices in the dinar as a rule, while only exceptionally they can display the price in foreign currency, as is the case in the trade in services in tourism that are in direct relation with foreign countries. However, in this case, according to the new law, the trader must indicate that in the calculation and charging of the price the official middle exchange rate of the dinar is used.
The new Law on Trade was published in the Official Gazette of the Republic of Serbia No. 52/2019 and shall enter into force on the eighth day from the day of its publication on 30 July 2019.
The Government of the Republic of Serbia announced that Serbia, by adopting a new Law on Trade (“Official Gazette of the Republic of Serbia” No. 52/2019) and the Law on Amendments to the Law on Electronic Commerce (“Official Gazette of the Republic of Serbia” No. 52/2019 ) in the Parliament, becomes the country in which electronic commerce takes place in accordance with the most advanced models currently available in the world.
New business models have been introduced, such as electronic store, electronic platform and dropshipping.
These changes will enable our economy to more easily market its products not only in Serbia, but also in the global market.
Serbia is becoming part of a group of countries that recognize the digital economy as one of the main drivers of the development of the entire economy.
New laws recognize the importance of e-commerce, which is now defined as a special form of trade.
Incomparability and dilemmas about retail stores and platforms that sell globally have been removed.
In order to increase legal security and respond to the challenges that electronic commerce brings with it, for the first time, the application of the mystery shopper will be enabled, which will significantly improve consumer safety during online shopping.
One of the key issues was solved – the possibility to raise prices in foreign currency when it comes to sales directed towards the global market, which overcame the problem with which until now the placement of goods from Serbia on the global market has been limited.
In the future, it will be possible for the complete e-commerce documentation to be in digital form, which is in accordance with the Law on Electronic Document, Electronic Identification and Trusted Services in Electronic Commerce (“Official Gazette of RS” No. 94/2017).
These changes mean continuing the reforms of the domestic legislation aimed at improving the business environment, on which the Government of the Republic of Serbia will continue to insist.
In accordance with the opinion of the Ministry of Finance no. 413-00-277 / 2017-04 issued on 27.5.2019, if the electricity bill is in the name of one VAT payer and the electricity is used by another VAT payer, in that case VAT calculated and reported in the electricity bill cannot be reported as input VAT by the VAT payer in whose name the bill is due to the fact that it does not use electricity for performing its activities in the industry within which it is operating with the right to deduct input VAT; nor by the VAT payer – the user of electricity, because the bill of VAT payer – previous participant in the transport (electricity supplier) is not issued in the name of this VAT payer.
In the Official Gazette of RS, number 50/2019, new rulebooks in the field of tax regulations have been published.
In the area of corporate income tax, the following rulebooks were published:
- Rulebook on the conditions and manner of exercising the right to recognition of costs directly related to research and development in the tax balance in doubled amounts,
- Rulebook on the conditions and method of exempting qualified income from the income tax base of legal entities,
- Rulebook on the conditions and manner of exercising the right to tax credit for investing in the capital of a newly established company that performs innovative activities.
In the area of personal income tax:
- Rulebook on exercising the right to tax exemption for the employee’s earnings on the basis of own shares that he acquires without compensation or at a preferential price,
- Rulebook on exercising the right to tax exemption based on the organization of recreation, sports events and activities for employees.
The new rulebooks will come into force on July 20, 2019.
At the session held on July 11, 2019, the Executive Board of the National Bank of Serbia decided to cut the reference by 0,25 percentage points to 2,75%. The next session of the Executive Board should be held on August 8, 2019.
From 01. 07. 2019. the organizational transformation of the Tax Administration of the Republic of Serbia entered into force. In accordance with the Tax Administration Transformation Program, the number of organizational units in the territory of Serbia in August 2017 decreased from 178 to 78. The next step was further consolidation of the organizational units of the Tax Administration – from the existing 78 to 37 branches, which came into force on 01.07.2019.
The list of new organizational units of the Tax Administration of the Republic of Serbia can be found on the website of the Tax Administration.
The Tax Administration had in mind the needs of citizens regarding tax forms such as taxes on the transfer of absolute rights to motor vehicles and real estate, inheritance and gift taxes, tax on holding, wearing and using goods.
For this reason, the Division for Separate Activities has been established, which has organizational units in a number of locations throughout the Republic of Serbia, where taxpayers can submit tax returns in paper form. Natural persons are allowed to submit tax returns electronically and in paper form in all organizational parts of the Tax Administration – as it was before.
Also, clerk’s offices will remain open in the future, through which citizens will be able to get in touch with the Tax Administration.
Source: webisite of Tax Administration
After being postponed for several times, the new VAT Rule Book came into force on 01/07/2018 introducing new records, as well as the obligation of taxpayers to submit a VAT calculation, together with the VAT return. The Tax Administration of the Republic of Serbia has published on its website the User Manual for presenting of Data in the VAT Calculation Overview, which also presents the legal framework, general guidelines, explanations and examples.
After the beginning of the implementation, a one-year period was left in which the tax authority did not take into account the erroneously presented data that do not affect the amount of the tax liability. That period ended on 30/06/2019.
It should be emphasized that regulations do not stipulate any penalty clauses which would apply in case the data which do not affect the VAT liability in VAT records and ’POPDV’ (VAT Calculation Overview) and ’PP PDV’ (VAT Tax Return) forms are not correct. Therefore, we assume that in case of the tax audit, the incorrectly presented data will be noted without imposing any penalties.
The American Chamber of Commerce sent a letter to the Ministry of Finance indicating the examples of relevant credible documents discussed at the meeting and which as such could be introduced as rules for acting in the general documents of employers.
Obtaining credible accounting documents by employers:
- In case of using one’s own car: usage of vouchers/coupons/cards for purchase of fuel by employees at the gas stations with which the employer has signed a contract. A consolidated bill issued to the employer which would specify all individual amounts of fuel purchased by the employees during one month, would be considered a credible document, with the accompanying list of employees who use their own car for commuting to work (name and surname of the employee, voucher/coupon/card No. for purchase of fuel).
- In case of using the public transportation: Purchase of monthly subscription tickets for the public transportation of employees by the employer. A consolidated bill issued to the employer, which would specify all individual purchased monthly subscription tickets, would be considered a credible document, with the accompanying list of employees who use public transportation for commuting to work (name and surname of the employee, number of monthly subscription ticket).•In case of using a taxi: Usage of company vouchers/coupons/cards for taxi rides with taxi companies with which the employer has signed a contract. A consolidated bill issued to the employer which would specify all individual amounts of taxi drives used by the employees during one month would be considered a credible document, with the accompanying list of employees using a taxi for commuting to work (name and surname of the employee, number of a voucher/coupon/card for a taxi ride).
Obtaining credible accounting documents by employees:
- In case of using one’s own car: Fiscal bill(s) for purchased fuel, with the accompanying statement of the employee that the said bill(s) refers to fuel that the employee purchased as part of the costs of his own transportation used for commuting to work, would be considered a credible document.
- In case of using a public transportation: Fiscal bill(s) for purchased monthly/daily subscription ticket(s), with the accompanying statement of the employee that the said bill refers to the monthly/daily subscription ticket(s) that the employee purchased as a part of his costs for using his own transportation means for commuting to work, would be considered a credible document.
- In case of using a taxi: Taxi bills with the accompanying statement of the employee that the said bills referred to the taxi drives that the employee used as part of costs of his own transportation for commuting to work, would be considered a credible document.
It is specified in the opinion of the Ministry of Finance No. 401-00-02148/2019-16 of 05/06/2019 that with regard to the examples specified in the letter, the Ministry of Finance is of the opinion that the delivered actual examples (totally six of them) of the corresponding credible accounting documents specified in the letter of the American Chamber of Commerce of May 10, 2019 should be accepted as credible accounting documents (with a note that it is necessary to stipulate the issue of documenting the costs for commuting to work of the employees by the general document of the legal entity, i.e. entrepreneur), based on which the subject costs are recorded in the business records of legal persons, i.e. entrepreneurs, obliged to apply the Law).
In accordance with The Law on Fees for the Use of Public Goods a Rulebook on the application form for the registration of the fee payer for improving energy efficiency has been published, the monthly and annual calculation form for the quantities of energy/energy generating products supplied to consumers or put into circulation on the territory of the Republic of Serbia or imported into the territory of the Republic of Serbia, the form of monthly and annual calculation of the obligation to pay the fee, the form of the payment report, and the manner of submitting these forms.
Monthly accounts should be submitted by the fee payer by the 20th of the month for the previous month, while the annual accounts should be submitted by January 31, of the current year for the previous year to the Ministry of Mining and Energy in written form by post and in electronic form to the electronic address published on the website of the competent ministry.
The mentioned Rulebook shall apply as of July 1, 2019.
New regulations in the area of customs operations, which govern customs privileges, protection of intellectual property rights at the border and the conditions for reducing or excluding customs duties on certain goods, have been harmonized, harmonizing the legislation of the Republic of Serbia with the European Union in the area of the customs system:
1) Decree on Customs Privileges
2) Decree on the conditions and method for the implementation of measures for the protection of intellectual property rights at the border.
3) Decision on conditions and manner for reduction of customs duties on certain goods, i.e. for the exemption of certain goods from payment of customs duties in 2019 (in cases where goods originate from countries with which the Republic of Serbia has concluded a free trade agreement, the tariff rates defined by those agreements shall apply).
The said Decrees and Decision shall apply from June 17, 2019.
Regular annual financial statements of legal entities whose business year ended on Dec. 31, 2018. should be delivered no later than June 30, 2019.
In addition to the regular annual financial statements, legal entities are obliged to submit to the Business Registers Agency the following documents:
– Decision on adoption of regular annual financial statements
– Decision on the distribution of profit, that is, covering the losses according to the regular annual financial statement
– Annual business report if they are obliged to compile it
– An audit report, if the legal entity has an obligation to audit the financial statements
The legal deadline for compiling and submitting the Fiscal Balance Sheet is 180 days from the date of expiry of the period for which the tax is determined. Bearing in mind that on June 29th, the deadline for filing a tax return for determining corporate income tax and Fiscal Balance Sheet for 2018 is the first following business day, i.e. July 1, 2019.
At the session held on June 6, 2019, the Executive Board of the National Bank of Serbia decided to keep the reference interest rate at 3.0%. The next session of the Executive Board should be held on July 11, 2019.
The new insurance policies provided for in Article 15 of the Law on Health Insurance apply to retirees who have entered into an employment agreement before April 11th, 2019, and indisputably also to retirees who have entered into an employment agreement after April 11th, 2019.
“Article 15 of the Law on Health Insurance (“Official Gazette of the Republic of Serbia”, No. 25/2019 – hereinafter: the Law) regulates the issue of the priority basis of insurance in case when the insured person from Article 11 of the Law meets the conditions for acquiring the status of insured person on several grounds, as well as the obligations of the listed categories of persons who fulfill the condition for acquiring the characteristics of the insured on several grounds, to choose one of the insurance bases under which they will be insured. Based on the aforementioned Article 15 of the Law, the insured retirees who have entered into an employment agreement no longer have the obligation to choose the basis of insurance according to which they will be insured, but, in the case of employment, they must be insured as employees.
The correct application of this provision implies its application to retirees who have entered into an employment agreement before April 11, 2019, and indisputably also to retirees who have entered into an employment agreement after April 11, 2019. Please note that, by the appropriate application of this provision, insured retirees who are employed, as well as members of their families who are insured through them, do not suffer any interruptions in the health insurance, but only change the insurance basis. To that end, the Republic Health Insurance Fund, in cooperation with the Republic Pension and Disability Insurance Fund, should take the necessary measures and activities so that all retirees who are employed and members of their families who have been insured through them, could continue to exercise the rights of the compulsory health insurance, without interruptions, in accordance with the law. ”
(Opinion of the Ministry of Health, No.: 011-00-95 / 2019-05 (1) of 14th of May 2019)
The new Law on Health Insurance (Official Gazette of RS, No. 25/2019) entered into force on April 11th , 2019. It shall apply to all proceedings commencing from that date. Some of the most significant changes are the following:
- The law regulates that parents have the right to sick leave with the income of a full salary during the medical treatment of a child suffering from a serious illness until the age of 18 years. Sick leave will have to be renewed every six months.
- The chosen doctor can provide a sick leave note in the duration of up to 60 days, instead of the 30 days which were given so far.
- Specialized doctors may refer patients to hospital treatment, and not only the chosen doctor
- Establishment of a unique waiting list to be conducted by the National Health Insurance Fund (RFZO).
- It is also foreseen that those who do not respond to preventive examinations three times and do not provide a justification for this, must pay 35% of the cost of treatment if they get sick from the illness for which the screening was intended.
- A new insurance base is introduced for farmers, for persons performing public notary and enforcement activities, for persons receiving a pension or invalidity allowance exclusively from a foreign insurance fund, that is, those who have permanent or temporary residence in Serbia, for the victims of terrorism and combatants whose status is determined in accordance with the regulations on the protection of combatants.
- Primary health care is transferred to the state level, except pharmacies that remain within the competence of local governments.
- The conditions related to absence from work for maintenance of pregnancy for the period after the 30th day of absence are more rigorous.
- The basis for the compensation of salaries paid from health insurance funds is the average salary earned by the insured in the previous 12 months before the month in which the temporary preventability for work occurred. Earnings is composed of payment for work performed and time spent at work, determined in accordance with labor regulations (employee’s basic salary, part of earnings for work performance, increased earnings).
- Employed pregnant women must work for 12 months without interruption prior to opening a sick leave due to their absence from work in order to maintain their pregnancy, in order to receive full amount of financial compensation.
- If an employed pregnant woman has not earned a salary in the 12 calendar months preceding the month in which the sick leave due to absence from work is initiated for the purpose of maintaining a pregnancy, the earning base constitutes the average amount of earnings for the time the pregnant woman earned her income, bearing in mind that the as a base for the months during which there were no earnings a minimum salary shall be calculated, with the limitation of the highest basis for compensation.
THE LAW ON TOURISM
The new Law on Tourism (“Official Gazette of the Republic of Serbia”, No. 17/2019) and the Law on Hospitality (“Official Gazette of the Republic of Serbia” No. 17/2019) entered into force on March 22nd, 2019. The old Law on Tourism, which ceased to be valid on the day of entry into force of the new law, regulated both areas – tourism and hospitality:
- According to the new definition, the tourist agency is a commercial company, an entrepreneur, another legal entity that performs tourist agency activities under the conditions prescribed by the Law, while the branch of a foreign legal entity will no longer be able to perform the activity of travel agencies. The new Law introduces a central information system in the area of catering and tourism (E-tourists), which enables electronic registration of guests, electronic payment of residence tax, submission of a request for categorization and other.
- In addition to the already existing possibilities for incentives, new financing for tourism promotion in the field of ecological standards, energy efficiency, use of renewable energy sources is foreseen; development of the national tourist brand; digitization and other innovative solutions; improving traffic connections with strategic markets; rural tourism and hospitality.
- The activity of a tourist agency may be performed occasionally at fairs and other public events, but not longer than 15 days.
- In relation to the travel agency license for travel organization, the deposit will be introduced as well as the license category. The amount of deposit will depend on the category of the license, and this area will be more closely regulated by the policy.
- In addition to the already prescribed obligations of the travel agency, new ones are prescribed, for example a tourist agency is obliged to sell a tourist trip at a selling price, which is expressed in a unique amount. Travel registration records are also introduced.
- A travel agency that sells a passenger service electronically is obliged to operate in accordance with the Law and regulations governing electronic trade.
- The identity card issued to tourist guides and tourist escorts is issued with a validity period of ten years.
- “Limo service” is no longer subject to regulation of the Law, and within the rent-a-car, the possibility of renting a motor vehicle A category is introduced. The service provider must have at least five registered motor vehicles of category B. The motor vehicle can not be older than five years, counting from the date of the first registration, and on motor vehicles and services provided, records are kept with prescribed content.
- Any change of data, which should be entered in the register of the Business Registers Agency, should be automatically taken into the Register of Tourism.
THE LAW ON HOSPITALITY
The new Law on Tourism (“Official Gazette of the Republic of Serbia”, No. 17/2019) and the Law on Hospitality (“Official Gazette of the Republic of Serbia” No. 17/2019) entered into force on March 22nd, 2019. The old Law on Tourism, which ceased to be valid on the day of entry into force of the new law, regulated both areas – tourism and hospitality:
- The new Law introduces a central information system in the field of hospitality and tourism (E-tourists), which enables electronic registration of guests, electronic payment of residence tax, application for categorization and other.
- Hospitality activity can be performed by a company, another legal entity and an entrepreneur, if registered in the appropriate register. Some hospitality services can also be provided by a physical person.
- Some new concepts have been introduced by the law and the definition of existing concepts has been carried out.
- The hospitality worker who provides accommodation services in an unclassified hospitality establishment is obliged to submit a registration to the local self-government unit on whose territory the facility is located, before the commencement of its activity.
- Establishment of the Central Information System in the field of hospitality and tourism (hereinafter: CIS) is envisaged. It is planned to adopt a rulebook on how to enter, operate, manage and use CIS, as well as prescribe its content and type of data.
- The Ministry is obliged to enter in the CIS the data on the facilities and the caterer, which it records, as well as the data on the health institutions that perform the hospitaity related activity, and the local self-government unit is obliged to enter data on the objects it registers in the CIS. Hospitality workers will have to have access to CIS in order to enter data on the accommodation user. Also, each request for categorization of catering facilities is submitted via CIS.
- For the purpose of checking the quality of service provision in categorized hospitality facilities, a business association of hospitality workers may designate a secret guest who makes a report with an expert opinion which he can submit to the Ministry.
- A physical person can provide hospitality services in a domestic hospitality facility and a village tourist household of up to 30 individual beds, for up to 30 users of services, and only accommodation services (so far it could provide food services).
- A physical person as a hospitality worker is obliged to clearly state his name and surname at the entrance of the building, as well as the contact telephone and must be the owner or co-owner of that accommodation facility. Exceptionally, hospitality services may also be provided by a member of the family household of the owner or co-owner, with their written consent, which must be certified by the notary public. The physical person for the provided hospitality services issues a special account, with prescribed content and it is obliged to keep a record of the issued invoices at the daily level.
- The taxpayer pays the physical person in the determined annual amount, while the Government shall prescribe more precisely the conditions and manner of determining the amount of the annual amount of the residence tax for the natural person providing hospitality accommodation services, as well as the manner and deadlines for payment.
- A completely new chapter on “personal data protection” has been introduced, as well as the possibility for the inspector to act as an anonymous user of the service.
The Tax Administration has published the Annual Tax Control Plan for 2019, in accordance with the Taxation Plan for 2019/2020. The tax control plan is mostly coveres taxpayers on the basis of the risk analysis criteria, which are created on the basis data reported in tax returns.
The level of taxpayer risk is determined using the following general criteria:
– Level of turnover,
– The size of the taxpayer from the financial statements,
– Frequent change of the competent tax branch,
– Number of employees according to the size of the taxpayer,
– Taxpayers which have related parties, and the latter is temporarily seized of PIB,
– raised cash to revenue ratio,
– Participation of exports in total turnover,
– The amount of business loss reported in the business,
– The amount of loss,
– The status of the taxpayer bankrupt / liquidation,
– The ratio of non-material costs and revenues,
– The ratio of operating revenues and operating expenses,
– The ratio of total revenues and expenditures,
– Participation of operating income in revenues,
– Net income and revenues ratio
– The ratio of profit and taxable profit,
– Previous controls, frequency and control status
Tax control will focus on the following taxpayers:
– taxpayers whose founders are non-residents, their transactions with related parties, and the application of a double taxation treaties,
– taxpayers who perform status changes and the impact of the transfer of assets and liabilities to VAT and corporate income tax,
– taxpayers dealing with the trade in petroleum products and the accuracy of accounting and payment of excise duties.
The control will check the accuracy of the obligation to disclose VAT, excise tax, corporate income tax, income tax on self-employed activities and withholding tax.
Special attention will be paid to taxpayers who reported a tax credit longer than 12 months. When choosing a taxpayer for VAT control, the data in the VAT Review of Value Added Tax on the POPDV form will also be used.
In the implementation of the Annual Control Plan for 2019, 490 tax inspectors will be engaged with 771,750 annual fund of effective working hours, which is the basis for determining the possible number of controls in 2019.
80% of the total available effective hours of working hours will be planned at the Tax Administration.
Pursuant to Article 61, paragraph 3 of the Legal Entity Profit Tax Law (“Official Gazette of the Republic of Serbia”, No. 25/01, 80/02, 80/02 – other law, 43/03, 84 / 04, 18/10, 101/11, 119/12, 47/13, 108/13, 68/14 – other law, 142/14, 91/15 – authentic interpretation, 112/15, 113/17 and 95/18), Minister of Finance adopted the Rule-book on interest rates for 2019 that are considered to be in accordance with the “arm’s length” principle. The Rule-book is published in the “Official Gazette of the Republic of Serbia”, no. 13/2019 and enters into force on March 8th 2019.
Pursuant to Article 2 of this Rule-book:
For 2019, the interest rates are:
1) for banks and financial leasing companies:
(1) 2.72% on short-term loans in RSD;
(2) 3.64% on loans in EUR and RSD loans indexed in EUR;
(3) 5.05% on loans in USD and RSD loans indexed in USD;
(4) 2.98% on loans in CHF and RSD loans indexed in CHF;
(5) 3.91% of loans in SEK and RSD loans indexed in SEK;
(6) 4.25% on loans in NOK and RSD loans indexed in NOK;
(7) 1.92% on GBP loans and RSD loans indexed in GBP;
(8) 1.41% on loans in RUB and RSD loans indexed in RUB;
2) for other companies:
(1) 4.98% on short-term loans in RSD;
(2) 5,69% on long-term loans in RSD;
(3) 2.71% on short-term loans in EUR and RSD loans indexed in EUR;
(4) 2.90% on long-term loans in EUR and RSD loans indexed in EUR;
(5) 7.61% on long-term loans in CHF and RSD loans indexed in CHF;
(6) 3.08% on short-term loans in USD and RSD loans indexed in USD;
(7) 4.12% on long-term loans in USD and RSD loans indexed in USD.
Interest rates apply to borrowings as well.
All E-Porezi Portal users will be able to receive tax certificates electronically starting March 1st 2019. Tax Administration of the Republic of Serbia has enabled the issuance of electronic certificates on paid taxes from all payment accounts of public revenues, certificates on paid health insurance contributions, certificates on paid VAT, and certificates on paid taxes and withholding contributions without needing to go to the Tax Administration field office.
For the purposes of exercising rights in the field of social protection, implementation of active employment policy measures, concluding an employment contract, enrollment of children in kindergarten, exercising rights on compulsory health insurance, exercising rights in the area of financial support to the families with children, payment exemption of court costs and providing proof in the procedure related to pre-school and school education, student and pupil issues, professional development and retraining – in accordance with the provisions of the Law on Republic Administrative Taxes, the fee for the issued certificate will not be required.
Instructions on issuing of electronic certificates can be found on the Republic of Serbia Tax Administration website – www.purs.gov.rs, and for all other information can be received by calling the Contact Center- phone no.: 011-33 10 111 and 0700-700-007.
* Text taken from the Tax Administration’s FB website *