Serbia | Changes to VAT Legislation Effective From July 2018

On 24th April 2018, the following main amendments to the Serbian VAT Law were published in the Official Gazette and generally come into effect as of 1st July 2018:

  • The deemed time of supply relating to intellectual property rights, which is the day of invoice issuance (when provided prior to supply or payment), will include services directly related to such supplies, if rendered by the same company;
  • The tax exemption with the right to deduct will apply to supplies of goods entered into a free zone, made to foreign entities to be installed into goods intended to be dispatched abroad; and, transport and other services directly connected to such supplies;
  • The scope of the 10% reduced VAT rate is extended to apply to supplies of supplementary cattle feed; and
  • As of 1st January 2019, the right to recover input VAT is extended to foreign companies for the provision of taxable supplies of goods and services in Serbia, which are subject to the reverse charge mechanism.

Consequently, certain foreign businesses may have more opportunity to reclaim the input tax they incur in Serbia. If you are affected by these changes, please do not hesitate to get in touch.