The law in Serbia strictly and protectively shields persons with disabilities (PWD) as well as taxpayers who directly care for such people and include them in their tax records as members. The tax system recognizes the higher living costs and reciprocates through significant deduction factors on income tax!
The law roughly divides the levels (coefficients) of additional personal non-taxable tax deduction into two key separate groups according to the degree of established impairment.
A coefficient of 0.40 is applied. It includes persons with a legally established stage of milder but present physical disability.
An extremely significant coefficient of 1.50 is applied. Workers and family members who have the right to a permanent allowance for care and assistance by others are eligible under this basis.
The disability deduction can be used in two ways:
The Tax Administration requires official evaluation documents from competent institutions (PIO Fund (Pension and Disability Insurance), NHIF (National Health Insurance Fund)). Some of the relevant decisions are:
Tip: Income based on disability or assistance by others does not count towards the strict annual income threshold of a dependent person. This is an exception in the law!