Taxation on digital goods in Serbia

Due to the harmonization with the Law on Digital Property, amendments to the tax legislation were made, among which the most important are the following:

Amendments to the Law on Property Taxes introduce the taxation of inherited and donated digital property.

Rates are proportional, but differentiated depending on the degree of kinship between the testator, i.e. the donor and the taxpayer, so:

• taxpayers who are in the second line of inheritance in relation to the testator or donor according to the legal order of inheritance pay inheritance and gift tax at the rate of 1.5%;
• taxpayers who are in the third and further hereditary order in relation to the testator or donor, i.e. taxpayers who are not related to the testator or donor, pay inheritance and gift tax at the rate of 2.5%.

The most important changes concern the Law on Personal Income Tax, which regulates the taxation of income from the trade of digital property.

The method of taxation of income generated by a natural person through the transfer of digital assets is specified, as income that is taxed with capital gains tax at a rate of 15%.

Tax exemptions

A taxpayer who invests funds generated by the sale of digital assets within 90 days from the date of sale in the share capital of a company resident in the Republic of Serbia, or in the capital of an investment fund, and whose center of business and investment activities is located in the Republic of Serbia, is released 50% capital gains tax.

Also, a taxpayer who, within 12 months from the day of the sale of digital assets, invests the funds generated by that sale for the above-mentioned purposes, will be refunded 50% of the paid capital gains tax.

Exceptionally, in the event that the company in whose share capital funds are invested from the sale of digital assets, in the calendar year in which the investment is registered and in the next two calendar years conducts the procedure of reduction of share capital, the day the decision to reduce share capital previously obtained exemption and is obliged to file a tax return.

It is specified that the purchase price in the transfer of digital assets is the price that the taxpayer documents as actually paid, and in the case of transfer of digital assets acquired by the taxpayer by participating in the provision of computer confirmation of transactions in information systems related to certain digital assets. assets), the purchase price is considered to be the amount of costs that the taxpayer had in connection with the acquisition of the digital assets in question and which can be documented.

In the case of transfer of digital assets acquired by the taxpayer from the employer or from a related party to the employer free of charge or at a preferential price, and if that receipt has already been subject to payroll tax, the purchase price is the sum of the documented price at which the taxpayer acquired digital property and the base on which the payroll tax was paid.

The Law on Corporate Income Tax stipulates that capital gains are also realized through the sale of digital assets, unless the taxpayer, in terms of the law governing digital assets, has a license to provide services related to digital assets and who acquired digital assets solely for further sales as part of the provision of services related to digital assets in accordance with that law.

Tax exemptions

Capital gains realized from the sale of digital assets are not included in the tax base, if the funds from that sale were invested in that tax period in the share capital of a resident taxpayer, ie an investment fund established in accordance with regulations governing investment funds. that is, investment activities located on the territory of the Republic.

Capital losses arising from the sale of digital assets cannot be offset against capital gains if the proceeds from the sale are invested for the aforementioned purposes.

In this way, efforts are being made to set a tax framework for digital property transactions, bearing in mind the importance it will have in the future.