The Ministry of Finance in Serbia has issued an official opinion that could bring relief to taxpayers involved in real estate transactions. This benefit is particularly relevant to individuals who choose to reinvest the proceeds from the sale of their real estate into acquiring another property.
To be eligible for this tax exemption, certain conditions must be met, and it is essential to emphasize that it is not an automatic privilege. Rather, individuals must obtain an official decision from the relevant tax authority.
This tax relief is specifically designed for those addressing their housing needs or those of their family members.
However, it’s important to note that the exemption is limited to capital gains arising from the sale of real estate and does not extend to gains from other sources, such as the sale of shares in a company.
To apply for this exemption, taxpayers need to submit a tax return using Form PPDG-3R. Alongside the return, documentation substantiating the resolution of their housing matter must be provided. It’s crucial to understand that this exemption is conditional and not a universal exclusion.
Furthermore, the Law on Personal Income Tax specifies that the exemption does not apply if the funds obtained from real estate sales are directed towards the basic capital of a legal entity or invested in an investment fund. This highlights the importance of a thorough understanding of the specific conditions attached to tax-free solutions for housing.
One key deadline to keep in mind is the 90-day window from the date of the sale of the first real estate until the purchase of another property. Adhering to this timeframe is crucial to benefiting from the tax relief outlined in the law.
By navigating these guidelines, individuals can make informed decisions about their investments and better manage potential tax liabilities associated with real estate transactions in Serbia.
Eurofast Serbia is at your disposal for any tax or legal support.
For further information or business inquiries, do not hesitate to contact our Belgrade office at: belgrade@eurofast.eu
Aleksandar Maljkovic
Tax Advisor
Eurofast Belgrade
belgrade@eurofast.eu