Amendments to the Law on Personal Income Tax bring important changes regarding the submission of the tax return for the annual personal income tax

Amendments to the Law on Personal Income Tax bring important changes regarding the submission of the tax return for the annual personal income tax

December 30, 2022

In the Official Gazette no. 138/2022 from December 12, 2022, amendments to the Law on Personal Income Tax (“Law“) have been introduced.

Overview of the most significant amendments and supplements is presented below:

  • Citizens shall pay their annual income tax through self-taxation system on the income generated in the calendar year, in accordance with this law, and no longer on the basis of the decision rendered by the competent tax authority;
  • Even though the tax payer for the annual personal income tax is obliged to submit a tax return with accurate data for the realized income to the competent tax authority at the end of such year, no later than May 15th of the following year, based on the data from the official records, the tax authority enters the data into the tax return application and posts it on the Tax Administration Portal until April 1st of the year following the year for which the annual personal income tax is determined, at the latest. The taxpayer is obliged to amend or supplement the tax return application in the part which does not show correct and appropriate data and afterwards submits the tax return application in electronic form via Tax Administration Portal, and if the taxpayer does not submit the tax return application within determined deadline, The Tax Administration submits a tax return application on behalf of that person;
  • Standardized costs in the dinar amount of 96,000 dinars, i.e. in the amount of 57,900 dinars have been recognized based on the income that the natural person generates in a quarter, in connection with: (i) income from copyright and related rights on which tax is paid through self-taxation system (with exception of revenues generated by a tax payer who has the status of an independent artist in accordance with the law regulating field of culture) and (ii) income based on the agreed remuneration for the work performed, on which tax is paid through self-taxation system, which a natural person realizes on the basis of the agreed remuneration for the performed work, for which tax is paid through self-taxation system. It should be noted that the first adjustment of the mentioned standardized costs with the annual consumer price index shall be carried out starting from the year 2024;
  • The non-taxable amount of salary has been increased and now amounts to 21,712 dinars, and the first adjustment of this amount with the annual consumer price index shall be carried out starting from the year 2024;
  • In case of by entrepreneurs and agricultural entrepreneurs, persons who are not registered with the Business Registers Agency, notification on determination for paying personal salary shall be submitted in electronic form via Tax Administration Portal, within five days from the date of registration with the Tax Administration, i.e. from the day of the tax identification number assignment, and no later than December 31st of the current year;
  • Persons are not registered with the Business Registers Agency submit a request for flat-rate taxation in electronic form via Tax Administrations Portal, within five days from the date of registration with the Tax Administration, i.e. from the day of the tax identification number assignment, and no later than December 31st of the current year;
  • Although, in general, the tax rate on income from copyright and related rights and industrial property rights is 20%, exceptionally, the tax rate on income from contractual remuneration generated from copyright and related rights for which tax is paid through self-taxation system, and for which the abovementioned standardized costs are applied in accordance with the Law, shall be 10%;
  • The tax rate for contractual renumeration for work performed, for which tax is paid through self-taxation system and for which the abovementioned standardized costs are applied in accordance with the Law, shall be 10%.

 Entry into force

Although the amendments and supplements to the Law entered into force on the eighth day of their publication in the Official Gazette of the Republic of Serbia, i.e. on December 20, 2022, the new provisions of the LAW shall apply from January 1, 2023.

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