The main topic of the article concerns the tax obligations of individuals in Serbia who sell real estate they have self-built but lack complete documentation of construction costs. The Law on Personal Income Tax defines capital gain as the difference between the selling and purchase price, where the purchase price in the case of self-construction is defined as the construction costs. If these costs cannot be proven, the tax base may be determined based on an administrative valuation. The tax administration must consider all evidence in favor of the taxpayer, including witness statements and expert findings. Such situations are not uncommon in Serbia, where many properties are built without complete documentation, and electronic transaction recording increases fiscal discipline.
Political Perspectives:
Left: Left-leaning sources emphasize the challenges faced by ordinary citizens in proving their investments in self-built properties due to lack of formal documentation, highlighting the risk of unfair taxation based on administrative valuations. They stress the need for tax authorities to consider all forms of evidence and protect taxpayers’ rights.
Center: Center-leaning sources present a balanced view explaining the legal framework of capital gains tax on self-built properties, the importance of proper documentation, and the procedures taxpayers can follow to prove their costs. They highlight the role of tax administration in fairly assessing tax obligations.
Right: Right-leaning sources focus on the importance of fiscal discipline and the enforcement of tax laws to prevent tax evasion. They emphasize the necessity of electronic transaction recording and strict adherence to tax regulations to ensure fairness and prevent loss of public revenue.
