08.08.2022

The general framework for donations and sponsorships in Republic of North Macedonia is regulated by the Law on Donations and Sponsorships in Public Activities, where the main and basic goal is to improve the personal and common life of the citizens, citizens’ associations and foundations, as well as legal entities and individuals, through realization of the public interest, which also contributes to their economic well-being and social justice. Additional benefit exercised by the donors and sponsors are certain tax incentives. The realization of the public interest through donations and the manner of using tax incentives in the sports is specially regulated by the Law on Sports, the Rulebook on the manner of using the means of tax incentives and the Law on Profit Tax. Namely, the Agency for youth and sports issues a voucher for using tax exemptions funds (which consists of reduction of the calculated profit tax for the amount of the donated funds, but not more that 50% of the calculated tax) on behalf of a certain sports entity, on the basis of which the donor is entitled to make donation of financial resources in the amount up to the amount determined in the voucher on a special purpose account of that particular sports entity. The use of the right to reduction of the calculated profit tax excludes the right to tax incentive of the profit tax in accordance to the Law on Donations and Sponsorships in Public Activities for donations in the sports. The donor as tax payer that uses this tax exemption can donate to one sports entity of same type of sport. As an exception, the donor can donate to two sports entities of the same type of sport, only if one entity is a national sports federation and the other is a sports club or an active athlete competing in individual sports.