Ministry of Finance (“MF”) has adopted the Rulebook on arm’s length interest rates for 2026 (“the Rulebook”). The Rulebook was published in the Official Gazette of Serbia No. 36/2026 dated 24 April 2026 and is effective as of 2 May 2026.
Impact of the Rulebook to transfer pricing documentation for 2026
According to the provisions of Article 61 of the Corporate Income Tax Law (“the CIT Law”), in determining arm’s length interest expense/revenue, taxpayers can:
- use interest rates as prescribed by the MF Rulebook or
- apply general OECD based methods for assessment of arm’s length interest as prescribed by the CIT Law.
Taxpayers may opt only for one of the above options. Selected option needs to be consistently applied to all intercompany loans.
The Rulebook prescribes separate interest rates for long-term and for short-term borrowings for all non-finance entities and a single interest rate for banks and finance leasing companies (except for RSD denominated loans where interest rate is prescribed separately for short term and long term loans).
Arm’s length interest rates for 2026 as prescribed by the MF
What impact may this have on your business?
Compared to 2025, in general decreasing trend of arm’s length interest rates is present, with the exception of interest rate for loans in RUB which has significantly increased. In addition, the interest rate for short-term loans in USD for other companies has not been published this year.
It is necessary to review if new interest rates for 2026 are aligned with interest rates currently applied in your related party financial instruments. In addition, companies exposed to significant / long-term related party financing should consider applying general OECD based methods for assessment of arm’s length interest as prescribed by the CIT Law, as such approach may be more beneficial and provide increased level of certainty in relation to future tax treatment.
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.
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