Before starting a business in Slovenia you have to consider what tax rates are and which taxes in Slovenia have to be paid according to Slovenian legislation. As Business Taxes in Slovenia are considered Value Added Tax (VAT) and Corporate Income Tax, while each individual has to pay also personal income tax.
Out company DATA will help you with everything. Our business migration consultants will help you with obtaining Slovenian Tax Number for identification purposes. They will get it for each foreign citizen who will open a company in Slovenia. Together with our accounting and taxation consultants we will find the most favourable taxation solution for your company!
Furthermore, experienced accountants and tax consultants will be glad to help you to optimise the costs of your new company!
Answers to the most important questions about taxes in Slovenia:
How is the VAT system regulated in Slovenia and how to get the VAT number?
In Slovenia a company must enter the VAT system (value added tax) in certain situations.
First, it has to do that, when it exceeds or is likely to exceed 50,000 EUR of taxable sales in Slovenia in the last 12 months.
Second, it is also mandatory to enter, if a company provides services or is a recipient of services from the other EU Member States. In this case, you need to enrol your company into the VAT system even before your company receives or issues such invoices. Under this circumstances is regardless what kind of amount of money is on an invoice.
Third, a company should enter the VAT system, when it exceeds 10,000 EUR in the purchase of goods from the EU during a period of time in the calendar year. Moreover, when entrepreneurs themselves want to enter the VAT system, they need concrete evidence of business. For example they have to do so with an agreement on the conclusion of business transaction. Also, they can do so with the receipt for the purchase of fixed assets, a contract for lease …
In addition, they can enter VAT system with an employment contract for their first employee or with other received or issued invoices.
The standard VAT rate in Slovenia is 22 % and 9,5 % reduced rate . The latter applies to goods and services specially defined by the VAT Act.
What is the amount of corporate income tax in Slovenia?
The standard rate of income tax (more precise tax from corporate income) in Slovenia amounts to 19 percent.
It is charged once per year depending on the achieved positive operating profit in the last calendar or fiscal year. Both revenue and expenditure affect the entire business profit. It is necessary to take into account that not all are eligible and some only partially reduce positive operating result.
At the same time a company can take advantage of tax relief for certain investments. It important to know, that your company will be liable to pay tax on corporate income if it has its headquarters in Slovenia. Also, it will have to do that, if you do not have headquarters in Slovenia, but the seat of actual management is here.
To be a tax resident or non-resident?
A natural person becomes tax resident in Slovenia, when it is actually living in Slovenia. But he has to do that for more than 183 days in one calendar year. In this case, you need to fill out the questionnaire of the Slovenian Financial Administration. When you do so, they then determine whether you can file an application for tax residence in Slovenia or not.
If you obtain the residence, you need to make sure you are erased from the Register of tax residents in your home country. Otherwise you will need to pay full tax in both countries from your income. If you are a tax resident in Slovenia and you receive an income in another country with which Slovenia has not concluded an international agreement and you pay part of the income tax there, you can still ask to only pay the difference in taxes in Slovenia. Only this way you can avoid double taxation.
What are the benefits for a tax non-resident?
Slovenia has concluded an international treaty on avoidance of double taxation with many countries. This means that in Slovenia individuals will pay from five to fifteen percent tax for dividends, interest or other property rights, and pay the difference (or not) in their country.
Non-residents may also have certain advantages. For instance, they can ask for a reduction of or exemption from tax if their income is by international agreement taxed at a lower rate or if it is exempt from tax in Slovenia. As well, they can opt for a refund of overpaid tax. You need to take into account that if an international treaty defines tax exemption, a recipient is returned full amount of paid tax.
Entrepreneurs need to respect the principle of worldwide income and pay the prescribed taxes on revenues generated in Slovenia. But, when they do so, this obligation should be deducted from the liabilities in their home country.
Conventions are not uniform though. This is why you need to check what kind of an international agreement is there for each country and what obligations do you have in Slovenia.
How is the personal income tax calculated in Slovenia?
An individual’s income is taxable at a progressive rate of 16 %; 27 %, 34 %, 39 %, 50 %.
A foreign individual, having residence permit in Slovenia has to pay Personal Income Tax if they are present in Slovenia for more than 183 days in 12 months period. In order to become Slovenian tax resident, an application form has to be filed to the Tax Office.
Do you need more information about salary in Slovenia? We prepared calculator, where you can calculate exact costs of chosen amount of salary!
What other taxes should a foreigner be aware of?
- Social Security Contributions
Every employer and employee should pay Social Security Contributions – employer 16,1 % and employee 22,1 %.
- Profit Repatriation Tax
Profit repatriation Tax is 0 % on dividends paid abroad for EU members and 15 % for other countries unless otherwise stated in a bilateral agreement. We will check bilateral agreements for you.
- Capital Gains Tax
The Capital is taxied by 0 to 25 % tax rate; the taxation depends on a holding period of sold capital.
- Property Tax
Slovenia doesn’t hold a property tax yet!
- Immovable Property Transfer Tax
When you sell property, you have to pay Immovable Property Transfer Tax which is 2 %. It is payed by the seller when the deal is closed. Mainly it is based on the contract value of the property.