Sitemap

LeitnerLeitner

VAT in the construction sector Practical Application Of Reverse Charge

LeitnerLeitner is one of the most influential tax consulting and auditing companies in Central and Eastern Europe, which is becoming more and more recognised in Serbia due to its professionalism and the high quality of services provided to clients

The internal calculation of VAT was recently extended to the area of construction services, by abolishing the condition that the provider and the service recipient must have the status of contractor or investor. Now it is only necessary for the supply to be made between two VAT payers.

The proposed solution is one of the steps towards harmonisation with EU regulations in the tax domain. The Act on the classification of business activities determines which supplies are considered as services from the construction area, by listing business activity codes. In practice, this approach does not reflect the essence of construction services, since the activities in the Act are determined on a statistical basis.

One of the main issues is how to interpret the Act, mainly due to the fact that the Act does not have a numerus clausus approach. For instance, construction of green areas is not expressly listed as a construction service, but under the business code for green areas, it is specifically listed that this code doesn’t include construction, which represents a service from the F Sector of the classification. While interpreting the Act, not only the linguistic method should be used, but also logical and systematic methods.

Another dilemma is how to classify supplies conducted within primary supply, which is classified as supply in the construction area. The Ministry of Finance took the view that each supply should be considered separately and the tax debtor is determined for each supply. However, this is not applicable if the service supplier levies the cost of the services provided by the third party (auxiliary services) to the recipient.

These problems are still to be solved in the coming period.

Jelena Knežević, Partner, LeitnerLeitner

Digitalization Makes Business Easier

In addition to dealing with current topics emerging from new fiscalization and the electronic invoicing system, LeitnerLeitner – to the satisfaction of its numerous...

Angela Merkel Opens Up On Ukraine, Putin And Her Legacy

Former German Chancellor Angela Merkel defended her legacy on Ukraine on Tuesday in her first major interview since leaving office. She refused to apologize for...

Germany Unveils New Measures To Cut Usage Of Natural Gas

Germany on Sunday announced it would reduce gas consumption and store as much natural gas as possible with a new set of measures, including...

Baerbock: Brussels Must Keep Its Promise Of EU Membership To The Western Balkans

On the eve of the EU Council of Foreign Ministers in Brussels, German Foreign Minister Annalena Baerbock pointed out that the EU must not...

UK: Lowest Car Sales Since 1996

Gathering economic headwinds are stoking fears of a recession after car sales dropped to the lowest level since 1996. UK...

In The New Report On Serbia GRECO Calls For Further Measures To Prevent Corruption

In a new report on Serbia, the Council of Europe’s Group of States against Corruption (GRECO) calls for further measures to...

China: Ready To Promote Global Development

The Forum on Global Development was held in Beijing, and on that occasion the President of the People's Republic...

Serbia And Hungary Sign Agreement On Border Control

The Agreement between the governments of Serbia and Hungary regulating border control in road, rail and water transport was...

Reception On The Occasion Of 140 Years Of Friendly Relations Between Japan And Serbia

Ambassador of Japan in Serbia H.E. Katsumata Takahiko hosted a reception in his residence to mark the 140th anniversary...