In line with the VAT Law, free of charge supplies of goods and services are subject to VAT. The taxable amount is the purchase price or cost price of such or similar goods and services at the moment of supply.
VAT invoices should be issued for each supply of goods and services performed by a taxable person to another taxable person, including supplies without consideration.
In practice, taxpayers used to issue VAT invoices for free of charge supplies,
but they indicated on the invoice that only the VAT amount should be paid to
the supplier. Recipients of such issued invoices reclaimed input VAT if general
conditions for input VAT deduction were met.
© 2020 KPMG d.o.o. Beograd, a Serbian limited liability company and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organization please visit https://home.kpmg/governance.