This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our PRIVACY POLICY for more information on the cookies we use and how to delete or block them.
  • Tax Highlights - April 2020 -4
Newsletter:

Tax Highlights - April 2020 -4

29 April 2020

Amendments to the Regulation on Fiscal Benefits and Direct Grants to Private Sector Companies to Mitigate the Economic Consequences of COVID-19

 

Pursuant to Article 200, paragraph 6 of the Constitution of the Republic of Serbia, the Government, with the co-signature of the President of the Republic of Serbia, adopts a Regulation on Amendments to the Regulation on Fiscal Benefits and Direct Grants to Private Sector Companies to Mitigate the Economic Consequences of COVID-19 effective on 24 April 2020.

The following are amendments to the previously enacted Regulation on Fiscal Benefits and Direct Benefits to Private Sector Companies to Mitigate the Economic Consequences of COVID-19 (hereinafter: the Regulation) by the articles subject to the amendment.

 

DIRECT BENEFITS TO BUSINESSES IN THE PRIVATE SECTOR

  • entrepreneur, flat rate taxpayer-entrepreneur, entrepreneur farmer, entrepreneur other person, legal entities classified as micro, small and medium

According to Article 9 of the Regulation, the value of direct grants equals the amount obtained as a product of the number of full-time employees for the corresponding accounting period and basic minimum net salary for March 2020. The payment of direct grants is planned for May, June and July 2020.

The amendment relates to the determination of the number of employees for the calculation of direct grants. Specifically, the amount of direct grant payable to a company in June 2020 is determined on the basis of the number of employees for the April 2020 accounting period, less the number of employees whose employment was discontinued by the company from 10 April  2020 until 30 April 2020, while the amount of direct grant to be paid to the company in July 2020 will be determined on the basis of the number of employees for the accounting period May 2020, less the number of employees whose employment was discontinued by the company from 1 May 2020 to 31 May 2020.

  • large legal entities

Pursuant to Article 10 of the Regulation, the value of direct grants equals the amount arrived at as a product of 50% of the basic minimum net wage and the sum of the number of full-time employees whose employment of has been discontinued since 15 March 2020, as defined in Articles 116 and 117 of the Labour Law.

The amendment relates to the determination of the number of employees for the calculation of direct grants. Specifically, employees who have a decision on discontinuation of employment for at least 15 working days in the month of April and May 2020 are included.

 

DEADLINE BY WHICH BUSINESS ENTITIES ARE OBLIGED TO USE DIRECT GRANTS

All business entities are obliged to use the received funds from direct grants by 15 August 2020 at the latest.

 

ACCEPTANCE OF MEASURES AND LOSS OF THE RIGHT TO USE MEASURES

The amendment defines that the refund of direct grants (for economic entities that lose the right to use the fiscal benefits and direct grants prescribed by the Regulation) shall be made to a special purpose account opened for that purpose with the Ministry of Finance - Treasury Administration.

 

DIVIDEND PAYMENT PROHIBITION

In addition, the definition of dividend was introduced in the sense of the Regulation, i.e., dividends are all payments made to their owners by a company on the basis of their ownership of the shares or stakes of that company.

In addition, amendments to the existing articles of the Regulation, a new article was adopted. Below is presented what it defines.

Private sector companies which, from the date of entry into force of the Rulebook on the List of Users of Public Funds, until the date of entry into force of this Regulation, have been deleted from the list of users of public funds from the Register of users of public funds, maintained as an electronic database with the Treasury Administration, acquire the right to open a special purpose account referred to in the Article, as well as the right to fiscal benefits and direct grants under the conditions prescribed by the Regulation.