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Tax News: Changes in the procedures for reporting and payment of personal income tax

Tax News

KPMG's Tax News outline and highlight legislative changes and trends in the area of tax.

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The Macedonian tax authorities announced that a new manner of reporting and payment of personal income tax (PIT) will be introduced starting from 1 January 2018.

According to the tax authorities, the changes are intended to simplify the procedures and lower the expenses for compliance with the reporting and payment of PIT both for legal entities and individuals.

Scope of the changes

  • Legal entities will be obliged to prepare and submit an electronic calculation (form e-PPD) for PIT through an online portal by the tax authority and pay PIT at the same time with the payment of the income. Upon submitting the calculations, the tax authority will generate an electronic payment order for simultaneous payment of income and PIT.
  • Individuals will be obliged to prepare and submit an electronic calculation (form e-PPD) for PIT through an online portal by the tax authority within a certain deadline upon receiving the income subject to PIT. Upon submitting the calculations, the tax authority will generate an electronic payment order only for the PIT.
  • The tax authorities will issue a pre-filled annual tax return (based on the electronic filings throughout the year) that should afterwards be confirmed by the individual within a statutory deadline. This will start to apply for FY2018.

Accordingly, the proposed changes indicate a similar concept in the reporting and payment of PIT, with the current system for reporting and payment of payroll liabilities under the monthly calculation for integrated payment (MPIN).

As a result of the proposed changes, the annual reports on PIT that have been submitted by the payers of income will be abolished and so will be the obligation of individuals to submit an annual tax return (the annual tax return will be generated by the Public Revenue Office on the bases of the data from e-PPD and other data available to it).

Next steps

As of August 2017, the Public Revenue Office will start with activities to involve all stakeholders (focus groups) in the process of testing the new electronic calculation for PIT and the e-PPD form.

 

© 2017 KPMG DOOEL Skopje, a Macedonian limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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