Taxation of individuals

A resident is obligated to pay Personal Income Tax (PIT) from all income, sourced both in and outside of Slovenia (principle of worldwide taxation).

A non-resident is obligated to pay PIT from all income sourced in Slovenia.

Personal income tax rates

PIT is calculated considering five tax brackets. The tax brackets are determined for one year in advance. In 2023, the following tax brackets and tax rates are applicable in line with the recent amendments of the PIT Act.

  Taxable base                       Tax on column 1                    Tax on excess

Over (column 1)     Not over                                                            

           0                    8,755                        0                                          16%

        8,755              25,750                 1,400.80                                     26%

      25,750              51,500                 5,819.50                                     33%

      51,500              74,160               14,317.00                                     39%

      74,160           and above            23,154.40                                     50%      

 

Note that capital gains, interest, dividends, and rental income are taxed at a flat rate of 25%. The tax rate on capital gains is decreased according to the length of the holding period.

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Social Contribution  

In addition to PIT, individuals must pay compulsory social security contributions. Both employer and employee must contribute. Contributions are withheld by the employer at the time of payment of income. Self-employed persons must pay income tax and social security contributions themselves. The basis is the gross amount of income. The types of contributions are generally as follows:

 

Type of contribution                             Employee (%)                  Employer (%)

Pension and disability insurance              15.50                                8.85

Health insurance                                         6.36                                6.56

Unemployment insurance                           0.14                                0.06

Injury at work                                               0.00                                0.53

Parental insurance                                      0.10                                0.10

Total                                                          22.10                              16.10

 

Payers of tax are obligated to pay social security contributions on the day of payment of wages or salaries.

 

Taxation of legal persons

Slovenian tax residents are liable to pay corporate income tax (CIT) on their worldwide income. Slovenian tax non-residents are taxed only on income from sources in Slovenia, including income earned through permanent establishments (PEs) in Slovenia.

Due to the floods causing highly material damage to Slovenian infrastructure in August 2023, Slovene government passed a Law on reconstruc-tion, development and the provision of financial resources to finance the reconstruction of the infrastructure. One of the provisions of the Law is also an increase in CIT rate to 22 % (from 19%) for years 2024 to 2028. Thus, the prepayments made in FY24 shall be calculated based on the newly adopted CIT rate of 22 %.

Non-profit taxpayers and charitable organisations, associations, foundations, etc. are exempt from CIT on their non-profit-making activities.

Investment funds, as well as pension funds and pension insurance companies, may be taxed at a rate of 0% if certain conditions are met.

 
Value Added Tax - VAT

The Slovenian VAT Act is in line with Directive 2006/112/EC.

A standard VAT rate of 22% applies to all taxed supplies.

A reduced VAT rate of 9.5% generally applies to foodstuffs, live animals, seeds, plants, water supplies, medicines, medical equipment, transport of passengers, books, admission fees, royalties for writers and performers, certain works of art, certain residential properties, renovation of residential properties, cleaning of residential properties, hotel accommodation, use of sport facilities, burial and cremation services, public hygiene services, minor repairs of bicycles, shoes and clothing, domestic care services, hairdressing services, and supply of flowers.

As of 1 January 2020, a super-reduced VAT rate of 5% applies for the supply of books and newspapers, in physical or e-form.

Slovenia did not implement provisions on VAT grouping.

The threshold for VAT registration is EUR 50,000, which does not apply to foreign taxable persons. Non-EU companies must appoint a fiscal representative.

A VAT return must be submitted for each tax period separately, as well as in case of no transactions. The deadline for submitting the VAT return is the last business day of the month following the end of the tax period. In cases of intra-EU supplies of goods and EU business-to-business (B2B) reverse-charge services, the VAT return is due by the 20th day of the month. In the latter case, the Recapitulative Statement also needs to be submitted. All forms are submitted electronically.

The payment of the VAT liability is due by the last working day of the month. In case of VAT surplus, the tax authorities refund it to the bank account of the taxable person within 21 days after the date of the submission of the form.

Based on the Slovenian VAT Act, the following categories do not allow input VAT deduction:

• Yachts and boats intended for sport and recreation, fuels, lubricants, spare parts, and services that are closely linked thereto, other than vessels used for transport of passengers and goods, leasing, renting, and resale.

• Aircraft, fuels, lubricants, spare parts, and services that are closely linked thereto, other than aircraft used for transport of passengers and goods, leasing, renting, and resale.

• Passenger cars and motorcycles, fuels, lubricants, spare parts, and services that are closely linked thereto, other than vehicles used for transport of passengers and goods, leasing, renting, and resale, vehicles used in driving schools for the provision of the driver's training programme in accordance with the regulations in force and combined vehicles for carrying out an activity of a public line and special line transport, and special vehicles adapted exclusively for the transport of deceased people.

• Entertainment expenses (where entertainment expenses shall include only the costs of entertainment and amusement during business or social contacts).

• Expenses for meals (including drinks) and accommodation expenses, except expenses incurred by taxable person in connection with these supplies in the ordinary course of business.

The person liable to pay the VAT is generally the supplier, or, in certain cases, the recipient (reverse-charge mechanism). Slovenia implemented Art 194 of the VAT Directive in 2022, which means that foreign taxable persons do not need to get VAT-registered in case of performing taxable B2B activity in Slovenia.

Domestic reverse charge applies for construction work (including repair, cleaning, maintenance, alteration, and demolition services in relation to immovable property), supply of staff involved in the performance of these activities, supply of certain immovable property where the taxation option was exercised, supply of waste, residues, and used material and services, and transfer of greenhouse gas emission rights as defined by the act governing the protection of the environment.