Amendments to the Value Added Tax (VAT) Law

04/01/2017

Amendments to the VAT Law are published in the Official Gazette of the Republic of Serbia No. 108/2016 dated 29 December 2016. The most important changes are presented below.

  • The obligation for non-resident entity to register for VAT in Serbia is more precisely defined. For example, foreign entity is not obligated to appoint a VAT proxy or to register for VAT in Serbia when taxable supply of goods and services is made solely to VAT payers in Serbia;
  • Rules determining the place of supply of services are significantly modified, but application of these amended rules comes into effect from 1 April 2017. Newly introduced general rule envisages that place of supply of services is the place where the service recipient has its head office or a permanent establishment, under condition that the service recipient is registered for VAT in accordance with the rules for place of supply of services (B2B). If, however, service is provided to non VAT payer, the place of supply of such services is the place where the service provider belongs. There are special place of supply rules for certain services as follows: services related to real estate, transport services, participation in cultural, sporting, scientific and similar events, etc.
  • The right of VAT refund for the purchase of food and equipment for babies is abolished;
  • The obligation for submission of VAT calculation breakdown together with VAT return is postponed to 1 January 2018.

Amendments to the law will be effective as follows:

  • Amendments to the law will in general be effective from 1 January 2017 (subject to certain exceptions);
  • The new rules for the place of the supply of services will be effective from 1 April 2017;
  • The abolition of the right of VAT refund on the purchase of food and equipment for babies will be applied from the date of application of the Law on Financial Support to Families with Children.
taxnewsletter_januar2017_eng_2.pdf