Property tax in Serbia
What Is Property – Definition
Property is a body of ownership rights and obligations of a natural person or legal entity. The term ‘property’ commonly includes the following rights: property, obligational, intellectual property and inheritance rights, as well as the debts arising from them. Some of the basic property characteristics are that it cannot be taken away from a natural person or legal entity and it is subsequently inalienable, that it exists as long as a person exists, that it is transferred to other persons as a legacy or enters bankruptcy estate.
Property is a civil law concept and it covers specific civil law relations that can be expressed in terms of money. In terms of civil law, property is closely related to a person’s subjectivity because it determines their legal capacity as well as transferability i.e. the possibility of being transferred through legal transactions.
Therefore, property is a body of transferable rights that can be expressed in terms of money, the owner of which is one natural person or legal entity. Under market economy conditions, property gives the impression that a natural person or legal entity is solvent, but one of its characteristics is that it serves as a certain debtor’s guarantee to his creditor.
What Is Tax – Definition
In terms of finance, taxes are the most important among different types of any country public revenues. Tax is a public revenue instrument, used by the country to forcefully collect money from natural persons and legal entities under its tax jurisdiction, without direct consideration, to cover its expenses and achieve economic, social, cultural and other goals.
When it comes to taxes, there is no immediate profit, which will be gained by a taxpayer as a result of tax settlement i.e. payment. When paying taxes, there is no connection between their height and taxation benefits because everyone have the same possibility to use different public resources such as military, police, education, judicial system, health care system, etc. regardless of the amount of payed tax.
That way, in a positive sense, the laws od the Republic of Serbia stipulate that property tax is the obligation of legal and natural persons (residents and non-residents) owning real estate within the territory of the Republic of Serbia, the value of which exceeds 400,000 dinars and is not excluded from tax payment (determined by separate articles of the Law – churches, diplomatic representative offices, foundations, etc.).
Property tax is payed on the following real estate rights:
– ownership right
– housing right
– the right to rent an apartment or dwelling unit for a period that is longer than one year
– the right to rent public building land i.e. state-owned agricultural land, with the surface area exceeding 10 areas.
Property tax is a complex process and numerous provisions, directives and rulebooks confirm that. We will list only some of them, which are related to 2022 property taxation:
– Property Tax Law (“Official Gazette of the Republic of Serbia” no. 26/2001, “Official Gazette of the Federal Republic of Yugoslavia” no. 42/2002 and “Official Gazette of the Republic of Serbia” no. 80/2002, 80/2002 – other law, 135/2004, 61/2007, 5/2009, …, and 118/2021)
– Rulebook on Tax Return Forms for Determined Property Tax i.e. for the Property Tax Determination (“Official Gazette of the Republic of Serbia” no. 93/2019 and 151/2020),
– decisions adopted by local authorities based on powers given to them by the Law, if they are published in accordance with the Law:
– the decision on the property tax rates;
– the decision on the determination of zones and the most equipped zone;
– decision on the determination of average m2 prices for relevant real estate, classified by zones (instead of that decision, when there were not at least three purchases of relevant real estate in the zones and border zones during the period from January 1 to September 30, 2021, local authorities published the average m² prices for the relevant real estate, based on which the property tax base for the year 2022 for the taxpayers, who do not keep business records in the zone defined as the most equipped, has been determined),
– the decision on real estate coefficients in the zones;
– the decision on classification of undeveloped building land, which is used only to grow plants, planting material, i.e. forests, as agricultural land i.e. forestland (the adoption of this decision is a possibility, not an obligation of a local authority).
Now it is clear why we pay so much attention to this topic and open the possibility for all who have doubts related to the issues in this area to get in touch with our team.