All material subject to strictly enforced copyright laws. © 2022 ITR is part of the Euromoney Institutional Investor PLC group.

Serbia: Serbia clarifies registration of foreign entities for VAT purposes

Rafailovic

Aleksandra Rafailovic

On May 23, 2016, the Serbian Ministry of Finance announced its clarifying opinion on the tax representation of a non-resident entity for the purpose of implementing the Law on Value Added Tax and the obligation to register for VAT.

Although the concept of tax representatives for non-residents existed in previous versions of the VAT Law, the latest amendments to the Act, adopted in October 2015, define conditions that VAT representatives should fulfill. It also allows non-residents providing goods and services in the Republic of Serbia to register for VAT via a proxy. Instructions on the process of registration were further described in the opinion issued by the finance ministry on May 23.

The criteria that tax representatives must fulfil includes mandatory registration in Serbia, having a VAT taxpayer status for at least the last 12 months, no tax arrears, and no convictions for a criminal tax offense. The decision on eligibility is issued by the Tax Administration within 15 days after completing the VAT representative registration process on the tax authority's website.

Today, only a limited number of companies are registered as VAT tax representatives for foreign entities. This is most likely because of the joint and severe responsibility for all obligations of the foreign entity that arises for VAT representatives. In addition, even though the rulebook and opinion explain most of topics, some practical aspects are still left unclear – including details about procedures for payments and VAT refunds.

Having all this in mind and considering that registration is not mandatory, but rather on a voluntary basis, it remains to be seen whether this new facility will be increasingly used by non-resident entities and their resident associates, or whether the VAT burden will remain with the domestic recipients of goods and services.

Aleksandra Rafailovic (aleksandra.rafailovic@eurofast.eu)

Eurofast, Serbia Office

Tel: +381 11 3241 484

Website: www.eurofast.eu

More from across our site

The state secretary told the French press that the country continues to oppose pillar two’s global minimum tax rate following an Ecofin meeting last week.
This week the Biden administration has run into opposition over a proposal for a federal gas tax holiday, while the European Parliament has approved a plan for an EU carbon border mechanism.
Businesses need to improve on data management to ensure tax departments become much more integrated, according to Microsoft’s chief digital officer at a KPMG event.
Businesses must ensure any alternative benchmark rate is included in their TP studies and approved by tax authorities, as Libor for the US ends in exactly a year.
Tax directors warn that a lack of adequate planning for VAT rule changes could leave businesses exposed to regulatory errors and costly fines.
Tax professionals have urged suppliers of goods from Great Britain to Northern Ireland to pause any plans to restructure their supply chains following the NI Protocol Bill.
Tax leaders say communication with peers is important for risk management, especially on how to approach regional authorities.
Advances in compliance tools in international markets and the digitalisation of global tax administrations are increasing in-house demand for technologists.
The US fast-food company has agreed to pay €1.25 billion to settle the French investigation into its transfer pricing arrangements over allegations of tax evasion.
HM Revenue and Customs said the UK pillar two legislation will be delayed until at least December 2023, while ITR reported on a secret Netflix settlement and an IMF study on VAT cuts.
We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree