The deadline for filing taxes, which expires on July 31, will not be extended for freelancers
The site intended for freelancers, through which they can report taxes and contributions, started working on July 1. So far, more than 1,900 tax applications have been registered, which means that there are about 1,000 freelancers who have submitted applications through the portal, as 900 and 1,000 tax applications have been submitted for the first and second quarter of 2023.
“This is the expected number of applications, since it is the first time that freelancers report taxes themselves under the new system", Nevena Janjić, a specialist in regulatory reform at NALED, tells Biznis.rs.
Our interlocutor points out that it is interesting that slightly less than 60 percent of tax returns were submitted under option II of self-taxation, which means that freelancers more often choose to pay themselves contributions for pension insurance.
“As for health insurance, it seems that freelancers opt for both options equally - so far we have more than 1,000 applications from people who are insured on a second, priority basis, and more than 900 people who are not," says Janjić.
Since the site went live, a large number of freelancers have had problems logging in and need additional help. That's why we asked Nevena Janjić whether the deadline for reporting taxes and contributions for the first two quarters after July 31 will be extended.
"There is no indication that the deadline for submitting tax application will be extended, since it is regulated by the Rulebook on tax application calculated through self-taxation and related contributions on earnings, i.e. other types of income by a natural person as a taxpayer. Therefore, it is not regulated by law, but only by a by-law", says the specialist for regulatory reform at NALED.
In accordance with the current regulation, freelancers are required to report and pay tax and contribution obligations 30 days after the end of the quarter. In this particular case, tax returns for the first and second quarter should be submitted and tax paid by July 31, since the last day of the deadline is a non-working day. The majority of freelancers are expected to submit their tax returns just before the deadline.
"As for the Freelancer portal, it is programmed so that it can support the application of a larger number of users, so we have more than 1,600 registered users so far. One of the most frequent prompts of freelancers is when applying for insurance. Therefore, it is necessary to register for social insurance first, and then submit a tax return", Janjić explains.
The big doubt of freelancers is whether they choose whether to pay contributions to the PIO or whether everyone who earns more than 96,000 dinars per quarter is obliged to do so.
"Paying contributions for pension and disability insurance is a possibility. In accordance with option I of self-taxation, if the freelancer earns less than 96,000 dinars - the amount of standardized expenses - he is not obliged to pay contributions. If, on the other hand, he opts for option II of self-taxation, the contribution for pension and disability insurance is mandatory and it will amount to at least 25,218 dinars on a quarterly basis. As we can see from the statistics, about 60 percent of applications were submitted under option II, and this is an indication that a lot of freelancers were waiting for the new self-taxation system so that they could pay themselves pension contributions. Also, we are talking about people for whom freelance jobs are the primary source of income, and this category of people has a little more income, since option I pays off financially if freelancers earn up to 160,000 dinars. Therefore, we can conclude that profitability is a relative matter compared to the rights that can be realized", assesses Nevena Janjić.
As for health insurance, it is mandatory if the freelancer is not insured on some other basis, and it amounts to 4,789 dinars per quarter.
Also, important information for freelancers is that before submitting a tax application, they should apply for social insurance through the PIO fund.
If they do not submit it within the deadline, they can subsequently submit an untimely application. If they do not report the tax even then, the Tax Administration control starts the procedure, which means that the freelancer will also pay interest.
The text is taken from the portal Biznis.rs: https://biznis.rs/vesti/srbija/frilenserima-nece-biti-produzen-rok-za-prijavu-poreza-koji-istice-31-jula/
The photo was taken from the Freepik portal (Image by marymarkevich on Freepik).