Serbia

Corporate income tax rate in the Republic of Serbia amounts to 15%, being one of the lowest in Europe. The country is also ranked among the top five European states with low labour costs: net average monthly salary is about EUR 380. At present, following years of political and economic instability, Serbia is considered as one of the premier investment locations in South-Eastern Europe. Since 2005, the Republic has attracted direct foreign investment volume of around EUR 11 billion.

The Serbian products exported to the EU member States, the Russian Federation, Belarus, Turkey, and Kazakhstan are exempted from customs duties. In recent years, the Republic of Serbia has concluded numerous free trade agreements with important international markets, such as some EFTA (Switzerland, Norway, Iceland) and CEFTA (Bosnia and Herzegovina, North Macedonia, Albania, Montenegro, Moldova, Kosovo) countries. Moreover, Serbia has preferential trade agreements with the USA.

6 simple steps to purchase a company

  1. choosing a country

  2. choosing a bank

  3. payment (by any method)

  4. sending documents

  5. company registration

  6. bank account opening

Main advantages

  1. The lowest tariffs on gas as well as other fuels, electricity, and telephone services.
  2. Annual rent price starts at EUR 2400, and average real estate value is in the range of EUR 200 and EUR 400 per square metre.
  3. Average monthly salary amounts to EUR 400.
  4. Low prices on accounting services and low non-recurring expenses (mail services, selection of premises).
  5. Optimal amount of social and health insurance contributions.

Types of companies

The Serbian Company Law provides for the following organisational and legal forms of entities:

  1. Entrepreneur
  2. Limited Liability Company
  3. General Partnership
  4. Limited Partnership
  5. Joint Stock Company
  6. There are also such organisational units as
  7. Branch office of a domestic entity
  8. Branch office of a foreign entity
  9. Representative office of a foreign entity

Registration procedure

When registering, the following is required:

  1. Information on the owner:
    1. For natural persons: photocopies of foreign and internal passports certified by a notary.
    2. For legal persons: extract from the registry of companies obtained in the country of origin (original document) with the company’s name, registration number, address, the owner’s and director’s names specified therein.
  2. Notary certification, apostille, and the Serbian translation must as well be provided.
  3. Information on the director: notarised passport photocopy and proof of residence (internal passport, utility bill dated up to three months ago).
  4. Limited power of attorney (can be prepared by our company), notary certification, and apostille are also required.
  5. Special notarised OP form for a foreign legal person (you may contact us to get a sample). Apostille must be provided.
  6. Memorandum of association with the notarised signatures of founders.
  7. Information on the company’s share capital.
  8. Registered office address.
  9. Company profile.

Taxation

Corporate income tax is imposed on entities established with the purpose of profit making. In Serbia, the tax rate on commercial activities is one of the lowest in Europe. In addition, the Republic has entered into agreements on avoidance of double taxation with 54 states (most European countries, Russia, Ukraine, Belarus, Canada, the UAE, etc.).

In order to promote investment and the development of small and medium-sized businesses, the Serbian legislation provides for such incentives, as subsidising, tax exemption (tax holiday begins once the company starts making a profit), investment tax credit, and accelerated depreciation.

  1. Corporate income tax — 15%
  2. Tax on dividends — 15%
  3. Personal income tax varies between 0% and 15% depending on the income level, tax deductions of up to 50% are available.
  4. Social security contribution rate for the employer — 17.9%
  5. Social security contribution rate for the employee — 19.9%
  6. VAT – 20 %

Reporting

Pursuant to the requirements of the local legislation, a large part of enterprises is obliged to file annual financial statements either electronically or in paper form. The amount of information to be published varies depending on the size of the company.

Financial statements reporting is regulated by the Law on Accounting, the Law on Auditing, and other normative instruments.

Accounting system in Serbia is based on the International Financial Reporting Standards (IFRS).

Mandatory financial statements are submitted to the Register of Financial Statements, which is administrated by the Serbian Business Registers Agency (since 2010).

Filing annual financial statements with the Tax Administration is obligatory for all entities.

The statements for the reporting year shall be filed no later than 30 June of the following year. Upon receipt, they are entered into the Register within 60 days.

If you have any questions, please fill in the contact form below, and we will reply as soon as possible