VAT Refund on the Purchase of a First Property

VAT Refund on the Purchase of a First Property

The Law Office Marović provides legal assistance with obtaining a value-added tax (VAT) refund when purchasing a first property.

What Does the VAT Refund on the Purchase of a First Property Entail?

The right to a VAT refund is regulated by the Law on Value Added Tax of the Republic of Serbia. This right applies to individuals purchasing an apartment or house for the first time directly from a developer registered in the VAT system. The refund is granted for residential space up to 40 m² for the buyer, plus an additional 15 m² for each household member.

This right does not cover purchases from private individuals, nor does it apply to garages, commercial premises, or ancillary rooms, but exclusively to apartments and houses intended for residential use.

 

What Conditions Must Be Met?

To be eligible for a VAT refund, the following conditions must be fulfilled:

  • The buyer is acquiring an apartment or house for the first time (ownership of land, a holiday home, or commercial property does not affect eligibility);
  • The property is purchased from a developer registered in the VAT system;
  • The residential area is up to 40 m² for the buyer, plus an additional 15 m² for each household member;
  • The purchase price, including VAT, is paid in full to the developer;
  • The application is submitted to the Tax Administration.

When to Consult a Lawyer

It is advisable to consult a lawyer before signing the purchase agreement to verify whether the seller meets the conditions (such as being registered in the VAT system), whether the contractual provisions are properly drafted, and whether all household members can be included. Engaging a lawyer in a timely manner helps prevent mistakes that could later result in the rejection of the VAT refund request.

Frequently Asked Questions (FAQ)

Do I have the right to a VAT refund if I buy an apartment from a private individual?

No, this right exists only when the apartment or house is purchased from a developer registered in the VAT system.

What is the area of the apartment that counts towards the refund?

Up to 40 m² for the buyer, plus an additional 15 m² for each household member.

What if I buy a 60 m² apartment and live alone?

The VAT refund applies to 40 m², while the remaining 20 m² is not eligible for a refund.

Can a spouse use the additional 15 m² entitlement?

Yes, each household member provides an additional 15 m² for the VAT refund.

What if spouses or family members are registered at different addresses?

The Tax Administration recognizes the additional 15 m² only for household members registered at the same residential address.

By when must family members be registered at the same address?

No later than the date of submitting the VAT refund request.

Do children lose the right to a VAT refund if they were listed as household members in the parents’ application?

No, the right to the refund belongs to the buyer, and children are only used to extend the eligible square footage.

Does the VAT refund apply to a garage or commercial unit purchased with the apartment?

No, the refund applies exclusively to the residential space.

Does the VAT refund apply when the apartment is purchased with a loan?

Yes, the right exists even when purchasing through a credit arrangement.

How long does the Tax Administration have to decide on the application?

Legally, the period is 30 days, but in practice, the process usually takes 2–6 months.

What if the apartment is sold shortly after purchase?

The right to a refund is not lost, and there is no obligation to return the funds.

Does the right apply to apartments under construction?

Yes, but the application must be submitted after notarization of the contract and final payment of VAT.

Does the refund apply when purchasing multiple apartments simultaneously?

No, the refund can only be claimed for one residential unit.

Can multiple buyers jointly claim a VAT refund?

Yes, the refund is calculated proportionally according to their ownership shares.

How is the VAT refund calculated when the apartment exceeds the limit?

The refund is granted only up to the limit; VAT on the excess area is not refunded.

Are terraces, storage rooms, or basements included in the area calculation?

No, only the usable residential area is counted.

Want to Claim a VAT Refund When Purchasing Your First Property?

The Law Office Marović is at your disposal to provide full legal assistance and representation throughout this process.

Note: The content of this text is for informational purposes only and does not constitute legal advice. Although we strive to ensure that the information is accurate and up to date, every situation has its specificities and requires an individual legal assessment. For precise and reliable advice regarding your specific case, it is recommended to consult a lawyer.

Last updated: 15 October 2025

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Novi Sad

Advokat Željko Marović
Bulevar Oslobođenja 82/III, 21000 Novi Sad
+381(0)21/661-64-10
advzmarovic@law-marovic.com
·   Pon – Pet 09:00-17:00

Beograd

Advokat Marko Marović
Svetog Save 25, 11000 Beograd – Vračar
+381(0)11/2440691
+381(0)62/577642
marko.marovic@law-marovic.com
·   Pon – Pet 09:00-17:00