The Association of Online Workers as well as the Association of Freelancers and Entrepreneurs of Serbia reached an agreement with the Government of Serbia regarding the method of paying tax liabilities of online workers, based on certain amendments to the Law on Personal Income Tax and the Law on Compulsory Social Insurance Contributions.
At the meeting of the National Assembly (April 28), amendments to the Law on Personal Income Tax and the Law on Contributions for Compulsory Social Insurance were adopted, based on which the manner of determining the tax liability based on income from agreed royalties is significantly changed and related rights and compensation for work performed, the so-called freelancer.
The Law on Amendments to the Law on Personal Income Tax introduced a non-taxable amount of 384,000 dinars per year (32,000 dinars per month) for the entire period covered five years ago, so that all those who earned less than about 768,000 dinars per year were exempt from taxes for the past period.
In this way, all claims of the Tax Administration from January 1, 2016, until the end of 2021 are written off for all freelancers who earned up to 64,000 dinars or 540 euros per month.
It is estimated that about 80% of freelancers will be exempt from paying taxes and contributions that they have not regulated in the previous 5 years, and the state will write off all interest to the rest and offer a reprogram for 10 years.
Also, the amendments to the Law determined the number of standard costs of 50%, which will reduce the tax base.
The adoption of the amendments practically temporarily suspended the determination of the tax liability by self-taxation for natural persons who earn income based on income from the agreed fee from the copyright and related rights and compensation for work performed.
Liabilities for taxes and contributions based on the above types of income of natural persons are determined by applying two groups of new rules depending on the period in which taxable income was generated. Freelancers who earned income in the period from January 1, 2015, to December 31, 2021 – the tax liability is determined under certain conditions, the decision of the tax authority by the amended, specifically prescribed for this purpose rules, while starting from On January 1, 2022, the tax liability will be determined by self-taxation.