Corporate Tax in Serbia is defined by the Law on Corporate Tax. Corporate Tax rate is proportional and uniform, and it is rated at 15%.
Unless otherwise stipulated by the International Agreement on Avoidance of Double Taxation, the Corporate Deduction Tax rated at 20% will be calculated and paid on income derived by a non-resident legal entity from a resident legal entity on the basis of:
- Dividends and profit share in a legal entity, including the dividend referred to in Article 35 of this Law on Corporate Tax;
- Compensation for copyright and related rights and industrial property rights (hereinafter referred to as: royalties);
- Compensation from the lease and sub-lease of real estate and movable property in the territory of the Republic;
- Compensation from market research, accounting and auditing services and other legal and business consulting services, regardless of the place of their provision or use, or the place where they will be provided or used.
The Deduction Tax will also be calculated and paid on the income of a non-resident legal entity on the basis of performing entertainment, artistic, sports or similar programs in the Republic of Serbia, which are not taxed as income of individuals (performers, musicians, athletes, etc.), in accordance with the regulations governing the taxation of personal income.
Are there any exceptions?
The exception from above stated, can be find regarding the revenues generated by a non-resident legal entity from a jurisdiction with a preferential tax system on the basis of royalties, interest, fees on the lease and sub-lease of real estate and movable property in the territory of the Republic of Serbia, as well as fees on the basis of services, regardless of the place of their provision or use, that is, the place where they will be provided or used, the Deduction Tax is calculated and at the rate of 25%.
Additionally, Deduction Tax will not be paid on the income generated by a non-resident legal entity, that is, a non-resident legal entity from a jurisdiction with preferential tax system, from interest on debt securities issued in accordance with the law by the Republic of Serbia, Autonomous Province, a Local Government or the National Bank of Serbia.
When does tax return must be filed?
The resident legal entity is obliged to, within 3 days from the day of payment of the income to file a tax return. Non-resident legal entity – recipient of income, is obliged to submit a tax return to the competent Tax Authority within 30 days from the day of income generation, through a tax representative determined in accordance with the Regulations Governing the Tax Procedure and Tax Administration, in the Municipality in whose territory the real estate is situated, where the seat of a Company in which the non-resident taxpayer holds a share or securities that are the subject of sale, that is, the seat or residence of the taxpayer of the lease or sub-lease of movable property, depending on the basis of which the competent Tax Authority makes a Decision.
For all questions regarding Corporate Tax, Value Added Tax (VAT) or any other taxation feel free to contact Asst Office at any time.