After Georgia, Canada, Tunisia and Vietnam, with which Treaties for avoidance of double taxation became applicable from 1 January 2014, the list of 54 states will soon be extended by Armenia, the agreement with which was ratified in July.
The treaty on the avoidance of taxation between the Government of the Republic of Serbia and the Government of the Republic of Armenia was signed in Yerevan on March 10, 2014, while the Law on ratification, and the text of the Treaty, were published in the Official Gazette of Republic of Serbia no. 7/14 of 3rd July 2014, and will enter into force in near future, once ratified by the Republic of Armenia..
The Treaty covers the corporate income tax; personal income tax and tax on property in Serbia and profit tax, income tax and tax on property in Armenia, and stipulates that both countries will allow deduction from taxes in the amount of tax paid in the other state.
Income from immovable property, dividends, interest, copyrights, artists/sportsmen income and capital gains from the alienation of immovable and movable property generated by a resident of one contracting state may be taxed in other state. In case of interest and royalties, the tax payable shall not be greater than 8% of the gross amount of interest and author fees.
Income for professional services (lawyers, doctors, accountants, engineers, scientist etc.) shall be taxable only in the resident’s State, unless they have permanent working base in the other state or stay there longer than 183 days in total during a 12 month period, and in that case tax will be calculated only for that part of the income.
Company profits generated in one contracting state shall be taxable only in that state unless the company is present in the other contracting state through a permanent establishment.
Students, professors and researchers shall be exempt from taxation of income for remuneration they receive for support during studies or for education, or remuneration for such teaching or research, if such payments arise from sources outside that State.
Just as a reminder – income recipients prove their residential status with a special form verified by the competent foreign authority and translated into Serbian language by a court interpreter.
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