Becoming a VAT payer is not a matter of choice—it is a legal obligation that arises once your total turnover in the previous twelve consecutive months exceeds eight million dinars. This threshold is not tied to the calendar year; instead, each month you must review the turnover generated in the last twelve-month period. Once the limit is exceeded, the obligation to apply for VAT registration arises within the legally prescribed deadline, regardless of whether you planned to enter the VAT system or not.

The turnover taken into account generally includes revenue from your core business activities, such as the sale of goods and the provision of services, meaning business income generated in the Republic of Serbia. However, certain types of income are excluded from this calculation by law, so it is important to interpret each situation correctly. For example, certain donations, subsidies, and specific types of transactions are not included in the total used to determine VAT registration.

By entering the VAT system, you assume the obligation to calculate and state VAT on invoices, maintain specific VAT records, and submit periodic VAT returns. Most taxpayers submit their VAT returns monthly, while certain taxpayers, under legally prescribed conditions, may submit quarterly returns. All these obligations require consistent deadline tracking, accurate documentation, and strict compliance with regulations.

If the obligation to enter the VAT system arises and the registration is not submitted on time, the Tax Administration may initiate a control procedure, determine the tax liability retroactively, calculate late payment interest, and impose penalties provided by law. This is why it is extremely important to monitor your turnover continuously to avoid unintentionally exceeding the threshold without timely action.

If you prefer not to handle turnover monitoring, deadlines, records, and all obligations that VAT registration entails, the best solution is to leave this to a professional team that monitors tax regulations and administrative requirements on a daily basis. This ensures that everything is done in accordance with the law, while you can focus on your business without additional stress.