Amendments to the Personal Income Tax Law Adopted
On December 9th 2022, National Assembly of Republic of Serbia adopted Amendments to the Personal Income Tax Law („Official Gazette of the Republic of Serbia“, no. 24/2001, 80/2002, 80/2002 – other laws, 135/2004, 62/2006, 65/2006 – corrected, 31/2009, 44/2009, 18 /2010, 50/2011, 91/2011 – decision of the US, 7/2012 – harmonized din. amount, 93/2012, 114/2012 – decision of the US, 8/2013 – harmonized din. amount, 47/2013, 48 /2013 – amended, 108/2013, 6/2014 – harmonized din. amount, 57/2014, 68/2014 – other laws, 5/2015 – harmonized din. amount, 112/2015, 5/2016 – harmonized din. amount, 7/2017 – harmonized din. amount, 113/2017, 7/2018 – harmonized din. amount, 95/2018, 4/2019 – harmonized din. amount, 86/2019, 5/ 2020 – harmonized din. amount, 153/2020, 156/2020 – harmonized din. amount, 6/2021 – harmonized din. amount, 44/2021, 118/2021, 132/2021 – harmonized din. amount, 10/2022 – harmonized din. amount, 138/2022 and 144/2022 – harmonized din. amount) (hereinafter: Law), which came into effect on January 1st 2023.
With the new Amendments to the Personal Income Tax Law, specific changes in relation to the already existing Law refer to the areas of annual personal income tax, non-taxable amount of salary, tax refund for a newly employed person, conditions for a newly settled taxpayer, requests for flat-rate taxation, applications for payment of personal salary and income from copyright and related rights and income from contracted remuneration for work (freelance).
According to the legal provisions, the annual personal income tax will (from the income generated in 2022) be reported and paid by self-taxation instead of by the decision of the Tax Administration. Based on the data from the official records, the tax authority enters the data and submits the tax return on the Tax Administration Portal no later than April 1st of the year following the year for which the annual personal income tax is determined.
The taxpayer is obliged to make possible changes and additions to the tax return through the Tax Administration Portal and then submit the tax return. The tax return is submitted exclusively electronically. The deadline for submitting the tax return and paying the annual tax remains May 15th of the following year for the previous calendar year.
Individuals who receive income from the copyright and related rights and income from contracted remuneration for work (freelance), on which tax is paid through self- taxation can choose one of two models applicable for determining taxable income.
Individuals who receive income from copyright and related rights and income from contracted remuneration for work (freelance), on which tax is paid through self-taxation, have the obligation to submit a tax return within 30 (thirty) days from the end of the quarter in which those incomes were generated.
What is new in relation to the previous Personal Income Tax Law, are the conditions for the newly settled taxpayer from Article 15v of the Law, which conditions will no longer be applied cumulatively, but it will be sufficient to fulfill one of two conditions:
- in the period of 24 months preceding the day of conclusion of the employment contract with a qualified employer, he did not reside mainly in the territory of the Republic;
- at the time of concluding the employment contract with a qualified employer, he is less than 40 years old, and who, in the period of 12 months preceding the conclusion of the employment contract with a qualified employer, mostly stayed outside the territory of the Republic for further education, i.e. professional development;
An employer who hires a new person will have the right to a refund of a part of the paid income tax for the newly employed person, paid as of December 31st, 2023.
An employer – a legal entity, an entrepreneur, a flat-rate entrepreneur or an agricultural entrepreneur, who employs a new person, has the right to a refund of part of the tax paid on the salary for the newly employed person, paid as of December 31st, 2023, as well as the employer – a legal entity that, in in terms of the law regulating accounting, classifies as micro and small legal entitie, as well as an entrepreneur, flat-rate entrepreneur or agricultural entrepreneur, who employs at least two new persons, has the right to a refund of 75% of the tax paid on the salary of a newly employed person, paid as of December 31st, 2023.
Individuals who do not register with the organization that maintains the register of business entities, submit the notification of their decision to pay their personal salary in electronic form through the Tax Administration Portal, within five days from the date of registration in the Tax Administration, i.e. the date of the TIN assignment, and no later than December 31st of the current year.
The request for flat-rate taxation can be submitted by October 31st of the current year for the following year, that is, within 15 days from the date of receipt of the act of the competent tax authority confirming the deletion from the records for value added tax, and no later than December 31st of the current year for the following year, electronically, through the Tax Administration Portal.
Exceptionally, individuals who do not register with the organization that maintains the register of business entities, submit a request for flat-rate taxation in electronic form through the Tax Administration Portal, within five days from the date of registration in the Tax Administration, i.e. the date of the TIN assignment, and no later than December 31st of the current year.
Note: The informations contained in this document do not constitute legal advice on any legal matter, but are provided only for the purpose of general information about legal changes.
If you have any questions or need additional information, you can contact the e-mail address office@ctlegal.rs
