VAT refund to foreign taxpayers

Foreign taxpayers who purchase goods or use services in Serbia can claim a refund of value added tax (VAT).

The procedure, known as VAT refund, enables the foreign taxpayer to be refunded for the VAT paid on the sale of movable goods and services provided in Serbia, but only on the condition that there is a principle of reciprocity – that is, the country from which the foreign taxpayer comes allows a similar refund of VAT to Serbian taxpayers.

In addition to reciprocity, in order to exercise the right to refund, it is necessary to fulfill other conditions prescribed by the VAT Act. The detailed procedure and documentation for submitting a request are defined by secondary legal acts.

Foreign taxpayers who are not registered for VAT in Serbia, but are in their home country, are entitled to a refund of value added tax (VAT) in Serbia. The refund procedure is carried out in accordance with the VAT Ordinance, and the request must be submitted electronically to the Tax Administration through its website and signed by an authorized person.

VAT refund is approved on the condition that all criteria prescribed by law are met:

1. 1) if the VAT is correctly stated in the invoice, in accordance with the Law, and if the invoice has been paid. It does not matter whether the transaction was carried out by a domestic or foreign person, provided that it is registered in Serbia for the obligation to pay VAT. However, if VAT is shown on the invoice without a legal basis – for example, if the transaction was not made, the place of transaction is outside Serbia or the transaction is exempt from VAT – the foreign taxpayer cannot exercise the right to a refund. Bank statements, SWIFT orders, business books, accounting reports, tax returns, as well as other documents, including expert findings or witness statements, which the Tax Administration can use in the decision-making process, are accepted as proof of bill payment.

   2) One of the conditions for exercising the right to a VAT refund is that the total amount of tax, for which the request is submitted, exceeds 200 euros in dinar equivalent at the middle exchange rate of the National Bank of Serbia on the day the request is submitted. This amount can be shown on one or more accounts.

   3) The conditions must be met in order for the VAT payer to exercise the right to deduct the previous tax for those goods and services,

   4) A foreign taxpayer can exercise the right to a VAT refund, provided that they do not sell goods and services in Serbia, except in the following cases:
   a) when performing goods transportation services that are exempt from VAT,
   b) when providing passenger transportation services that are subject to individual taxation,
   c) when carrying out transactions for which the VAT payer is the recipient of goods or services, and not the foreign payer themselves.

These exemptions allow foreign companies that do business with domestic VAT payers to request a refund, even when they are not registered in the Serbian VAT system, because the burden of tax calculation is borne by the domestic recipient of the service or goods.

5) The right to a VAT refund in Serbia is recognized only to foreign taxpayers from countries with which reciprocity in tax treatment has been established. This implies that the tax administrations of those countries enable the refund of VAT to Serbian taxpayers as well. The list includes: the Netherlands, Slovakia, Croatia, Denmark, Austria, Bosnia and Herzegovina, Belgium, Montenegro, North Macedonia, Slovenia, Germany, Great Britain, Turkey, Switzerland, Norway, Romania and Hungary.

Taxpayers from countries that are not on this list are not entitled to a VAT refund in Serbia, even if they meet all other legal requirements.

The right to a refund on the basis of immovable property

The right to a VAT refund in Serbia applies exclusively to the sale of movable goods and services, with the cumulative fulfillment of all legal conditions. Therefore, foreign taxpayers are not entitled to a VAT refund based on the purchase of real estate on the territory of Serbia.

However, in the case of leasing immovable property, such as the rental of a hall, the right to refund can be realized, because in this case it is about the supply of services in Serbia.

A foreign taxpayer with a representative office in Serbia and the right to a VAT rebate

A foreign taxpayer is a person who does not have a seat, permanent business unit or residence in Serbia, but is registered for VAT or other consumption tax in their country. The representative office of such a person in Serbia is considered a business unit, but not a permanent business unit for performing activities, except in special cases defined by international agreements.

A foreign taxpayer has the right to a VAT refund even if they have a registered representative office in Serbia that does not perform activities. This right refers to the procurement of movable goods and services in Serbia, including those for the needs of the representative office, provided that legal criteria are met.

In contrast, a foreign taxpayer is not entitled to a VAT refund for purchases made for their branch registered in Serbia. The branch, if it is a VAT payer, can deduct the previous tax according to the general rules.

Also, the fact that a foreign taxpayer has established a company in Serbia has no impact on the right to a VAT rebate, because they are two separate entities.

Procedure for exercising the right to VAT refund

According to the VAT Act, the right to a VAT refund is realized by submitting a request that must be signed by an authorized person and submitted to the Tax Administration.

The request can be submitted once a year, no later than June, 30th of the current year, and refers to goods and services purchased in the previous calendar year. For example, for traffic realized in 2024, the request is submitted by June 30, 2025.

Along with the request, the foreign taxpayer must attach the following evidence:

1. Certificate of registration for VAT or other form of consumption tax, issued by the tax authority of the foreign payer‘s country of residence (original and certified translation).
2. Paid invoices for goods or services purchased in Serbia, on which VAT has been calculated and paid.

The documentation for the VAT refund must be submitted to the Tax Administration in the Serbian language. After checking that the conditions have been met, the Central Tax Administration issues a decision on the request within 30 days of submission and delivers it electronically to the applicant.

Refunds are paid in the currency of the applicant’s country, converted at the selling rate of the National Bank of Serbia on the day of payment, with the deduction of conversion costs. The VAT rebate is carried out within 15 days from the delivery of the decision.

A foreign taxpayer who exercises the right to a VAT refund in Serbia for the first time must first register with the Tax Administration and obtain a tax identification number (TIN).