What is VAT for an apartment and how does it works?
VAT (Value Added Tax) is a mandatory tax that is paid when purchasing an apartment directly from an investor or legal entity, and its rate is 10% of the total price of the apartment. However, the state has enabled a VAT refund for the purchase of the first apartment, which facilitates the process of acquiring real estate for citizens who are solving their housing issue for the first time.
Who is entitled to a VAT refund for an apartment?
The following are entitled to a VAT refund:
Natural persons who are purchasing their first apartment (provided that they have not already used this benefit).
Citizens of the Republic of Serbia with permanent residence in the country.
Apartment buyers who own less than 15m² of total living space on the territory of the Republic of Serbia.
Important: VAT refund applies only to apartments purchased directly from investors, not to apartments purchased through resale.
How much is the VAT refund?
The VAT refund is calculated on the area of the apartment up to 40m² for the buyer of the apartment, with an additional 15m² for each household member. For example:
A buyer who lives alone is entitled to a VAT refund for 40m².
A family of three is entitled to a VAT refund for a total of 70m² (40m² + 15m² + 15m²).
If the area of the apartment is larger than this area, VAT on the remaining area is not refunded.
How is the VAT refund for an apartment made?
The VAT refund process is carried out through the following steps:
Concluding an apartment purchase and sale agreement with the investor.
After paying for the apartment and registering it, you submit a request to the Tax Administration in your place of residence.
The Tax Administration reviews the documentation and issues a decision on the VAT refund.
The refund will be made to your current account within 45 days of the date of submitting the request.
What documentation is required for a VAT refund?
To exercise the right to a VAT refund, you need to prepare the following documentation:
Completed VAT refund application (form taken from the Tax Administration).
Certified copy of the apartment purchase contract.
Confirmation from the seller (investor) that VAT has been calculated and paid.
Bank statement as proof of payment for the apartment.
Certificate of ownership of real estate (from the cadastre).
Proof that you are not the owner of the apartment or that you own less than 15m² (cadastre statement or municipal document).
Applicant's ID card.
VAT refund when purchasing an apartment represents significant savings for first-time buyers. It is important to collect the necessary documentation and submit the request to the Tax Administration in time in order to take advantage of this benefit.
Our agency is at your disposal for all advice and assistance regarding the VAT refund process, as well as for selecting the ideal property.
