Serbian Ministry of Finance published a Rulebook on arm’s length interest rates for 2021. Mostly, the trend of decrease in the arm’s length rates compared to the previous years continues.
As a reminder, based on Serbian Corporate Income Tax Law (CIT Law), the arm’s length interest can be determined either by using the interest rates published by the Ministry or by using general transfer pricing rules. While each company may opt freely, selected approach needs to be applied on all intercompany loans.
The text below outlines the arm’s length interest rates as published by the Ministry that can be considered arm’s length for 2021.
Banks and Providers of Financial Leasing Services:
- 0.67% for short term loans in RSD;
- 3.79% for long term loans in RSD;
- 2.83% for loans in EUR;
- 3.94% for loans in USD;
- 2.61% for loans in CHF;
- 3.96% for loans in SEK;
- 1.88% for loans in GBP;
- 2.56% for loans in RUB.
Other Legal Entities:
- 3.69% for short term loans in RSD;
- 3.90% for long term loans in RSD;
- 2.32% for short term loans in EUR;
- 2.83% for long term loans in EUR;
- 6.86% for short term loans in CHF;
- 1.57% for short term loans in USD;
- 4.01% for long term loans in USD.
