FYR Macedonia/December 2014
The Law on Value Added Tax in FYR Macedonia underwent a number of revisions in 2014, with the most recent reform taking place in early September. Published in the Official Gazette no. 130/2014 and effective as of September 11 2014, the new Law on VAT introduces some amendments that are expected to impact a large percentage of small and medium businesses.
According to the Law, as of 2015, the threshold for mandatory VAT registration is being slashed in half, from the current MKD 2 million ($40,000) in annual turnover to a mere MKD 1 million. It is expected that this change alone will make VAT registration mandatory for a large number of micro and small entities that are currently outside the VAT scheme based on lower annual turnovers. As a reminder, companies that have elected not to voluntarily register for VAT purposes before realizing the turnover threshold are required to do so within 15 calendar days of the day on which the threshold turnover is reached. As the Law will be in force as of 2015, this will create an obligation for a large number of companies that will reach a turnover of MKD 1 million within the 2014bfiscal year to mandatorily register for VAT purposes in the first 15 days of 2015.
The new Law also prescribes the possibility to issue electronic invoices between companies as of March 1 2015. The revised article has received positive feedback from the business community as it seems to open up possibilities for more streamlined and technologically advanced invoicing procedures which are now being regulated by old-fashioned laws and procedures. The article does, however, specify that the company being invoiced must be given a prior written approval declaring its willingness to accept electronic invoicing as opposed to paper-based invoices. It remains to be seen how further bylaws will regulate details of the application of this amendment and whether it will truly be aimed at simplifying B2B documentation and communication or whether it will result in the creation of additional compliance obligations and procedures.
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